ᐅ Procedure for Building a New Single-Family Home on an Existing Plot of Land
Created on: 18 Nov 2022 07:55
D
Dachshund90
Hello everyone,
I know no one has a crystal ball here, but I would still like to hear your opinions:
We have just purchased a plot of land in Hesse, currently live cheaply, and have no urgent time pressure to build (although sooner is always better), except for the 5-year building obligation required by the municipality, which, however, can be extended by 1-2 years for justified reasons. We have slowly started planning and would like to possibly have the completed plans along with the building permit for our new single-family home ready to go, so we can react relatively quickly.
My assessment is that construction prices and interest rates will change little in 2023, even if they might stabilize at a high level. How 2024 or 2025 will look, of course, no one knows. But what is your feeling:
1. Rush the planning and possibly take advantage of a small "interest dip" in 2023 for financing and start with the belief that neither interest rates nor prices will significantly fall in the medium term, and waiting is just lost time.
2. Plan completely calmly, continue to build up equity, and assume that conditions for a new build may improve by the end of 2024 or possibly 2025.
If things become more concrete soon, I would be happy to provide more information for planning and share your feedback.
I welcome any questions and opinions 🙂
Best regards
I know no one has a crystal ball here, but I would still like to hear your opinions:
We have just purchased a plot of land in Hesse, currently live cheaply, and have no urgent time pressure to build (although sooner is always better), except for the 5-year building obligation required by the municipality, which, however, can be extended by 1-2 years for justified reasons. We have slowly started planning and would like to possibly have the completed plans along with the building permit for our new single-family home ready to go, so we can react relatively quickly.
My assessment is that construction prices and interest rates will change little in 2023, even if they might stabilize at a high level. How 2024 or 2025 will look, of course, no one knows. But what is your feeling:
1. Rush the planning and possibly take advantage of a small "interest dip" in 2023 for financing and start with the belief that neither interest rates nor prices will significantly fall in the medium term, and waiting is just lost time.
2. Plan completely calmly, continue to build up equity, and assume that conditions for a new build may improve by the end of 2024 or possibly 2025.
If things become more concrete soon, I would be happy to provide more information for planning and share your feedback.
I welcome any questions and opinions 🙂
Best regards
X
xMisterDx14 Dec 2022 22:31The argument "it was like this before" comes up often. Sure, interest rates used to be 8%. But back then, savings bonds also offered 10 to 15% if you locked your money in for 10 years.
Today, mortgage interest rates are around 4%, but instant access savings accounts only bring about 1.5%, and my regular savings account still pays just 0.01%.
We are also experiencing record-high property prices and approximately 20% inflation in food prices.
I am a member of the IG Metall union, and we are getting an 8% raise over two years plus a one-time bonus of 3,000 euros. Even this likely won’t fully compensate for the current inflation for many people, let alone represent an increase in real wages.
In the 1990s, the Cold War had just ended, and people looked to the future with hope. Currently, it feels like the Cold War is beginning anew. We are also facing major disruptions in industry...
The situation is not comparable to the 1990s, so let’s just leave comparisons out of it.
In today’s situation, repaying a loan at 1% interest strikes me as sheer madness.
Today, mortgage interest rates are around 4%, but instant access savings accounts only bring about 1.5%, and my regular savings account still pays just 0.01%.
We are also experiencing record-high property prices and approximately 20% inflation in food prices.
I am a member of the IG Metall union, and we are getting an 8% raise over two years plus a one-time bonus of 3,000 euros. Even this likely won’t fully compensate for the current inflation for many people, let alone represent an increase in real wages.
In the 1990s, the Cold War had just ended, and people looked to the future with hope. Currently, it feels like the Cold War is beginning anew. We are also facing major disruptions in industry...
The situation is not comparable to the 1990s, so let’s just leave comparisons out of it.
In today’s situation, repaying a loan at 1% interest strikes me as sheer madness.
D
Dachshund9012 Jan 2023 19:23Ok, thank you for your assessments. We have already had two meetings with the bank, and there are two more appointments with architects scheduled for this week and next week. Overall, it sounds good and feasible so far.
Regarding the mortgage installment, we have recalculated a lot, determined expenses, and set a budget framework. Interest rates still seem quite volatile; we hope to catch a slight “dip” in the coming months.
Even though we are gathering a lot of information and trying to use the time well for planning, the process is progressing rather slowly overall. With the third architect, at least there is the impression that he has the capacity and time; otherwise, you often wait a lot for appointments and feedback.
I will be happy to share updates when the first drafts are ready and things become clearer, especially whether the architect’s cost estimate aligns with the bank’s figures.
Best regards
Regarding the mortgage installment, we have recalculated a lot, determined expenses, and set a budget framework. Interest rates still seem quite volatile; we hope to catch a slight “dip” in the coming months.
Even though we are gathering a lot of information and trying to use the time well for planning, the process is progressing rather slowly overall. With the third architect, at least there is the impression that he has the capacity and time; otherwise, you often wait a lot for appointments and feedback.
I will be happy to share updates when the first drafts are ready and things become clearer, especially whether the architect’s cost estimate aligns with the bank’s figures.
Best regards
D
Dachshund9019 Jan 2023 10:18Hello everyone,
Attached you’ll find a sketch of the contour lines for the plot. I set the zero point in the back left corner (as seen from the street). The land rises about 4 meters (13 feet) along the diagonal. If I place a house about 12 meters (39 feet) long on the site, the height difference along the length (from the street sloping down towards the back) would be roughly 1 to 1.5 meters (3 to 5 feet), depending on the house’s exact position. Two architects I spoke with early on were already convinced that building a house with a basement here makes sense.
That sounds logical at first: you could have ground-level access to the garden from the basement. However, the ground floor ends up somewhat high for a nice garden entrance.
What are your thoughts regarding earthworks and costs? Would we actually get a basement “somewhat cheaper” here, since earthmoving would be necessary even for a house without a basement?
Best regards
Attached you’ll find a sketch of the contour lines for the plot. I set the zero point in the back left corner (as seen from the street). The land rises about 4 meters (13 feet) along the diagonal. If I place a house about 12 meters (39 feet) long on the site, the height difference along the length (from the street sloping down towards the back) would be roughly 1 to 1.5 meters (3 to 5 feet), depending on the house’s exact position. Two architects I spoke with early on were already convinced that building a house with a basement here makes sense.
That sounds logical at first: you could have ground-level access to the garden from the basement. However, the ground floor ends up somewhat high for a nice garden entrance.
What are your thoughts regarding earthworks and costs? Would we actually get a basement “somewhat cheaper” here, since earthmoving would be necessary even for a house without a basement?
Best regards
D
Dachshund9019 Jan 2023 10:21You can find the sketch attached here.
D
Dachshund9019 Jan 2023 11:47Ok, sorry for the missing information. Attached is the sketch updated with the requested details.
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