ᐅ Homebuilding Forum – Would You Choose to Buy or Build a House Again?
Created on: 11 Dec 2015 11:09
X
xycrazy
Hello,
we are about to sign the contract with the developer but have started seriously reconsidering whether we should go through with it.
We negotiated for 8 months and were quite sure about it. However, towards the end, some issues arose regarding the contract and other matters, which we managed to resolve.
It now looks like we would be paying a third of our net income to the bank for 22 years. I think we can afford it. But when you are used to paying monthly rent of about €800-900 (divided by 2), this is quite a different level.
With a house, it’s not just the loan payments; there are ongoing maintenance costs as well. From what we’ve read, this is roughly €2-3 per m² (about 0.2-0.3 per sq ft) per month. So that’s another €400-500 per month. And, of course, there is much more work involved too.
Admittedly, this is stressing us out quite a bit, especially my partner. She is worried about the heavy financial burden each month. Is that justified?
We don’t want to live just for the house; we want to go on vacations, avoid problems with children, and so on. As I said, the current situation is manageable, but we wonder if we might be underestimating the costs.
So here’s my question to the community: looking back at everything you know now about loans, maintenance costs, upkeep, and so forth, would you buy or build a house again?
If yes, why? If not, why not? I’m really interested to hear your thoughts! And were there any surprises—positive or negative—that you didn’t expect?
Regards
we are about to sign the contract with the developer but have started seriously reconsidering whether we should go through with it.
We negotiated for 8 months and were quite sure about it. However, towards the end, some issues arose regarding the contract and other matters, which we managed to resolve.
It now looks like we would be paying a third of our net income to the bank for 22 years. I think we can afford it. But when you are used to paying monthly rent of about €800-900 (divided by 2), this is quite a different level.
With a house, it’s not just the loan payments; there are ongoing maintenance costs as well. From what we’ve read, this is roughly €2-3 per m² (about 0.2-0.3 per sq ft) per month. So that’s another €400-500 per month. And, of course, there is much more work involved too.
Admittedly, this is stressing us out quite a bit, especially my partner. She is worried about the heavy financial burden each month. Is that justified?
We don’t want to live just for the house; we want to go on vacations, avoid problems with children, and so on. As I said, the current situation is manageable, but we wonder if we might be underestimating the costs.
So here’s my question to the community: looking back at everything you know now about loans, maintenance costs, upkeep, and so forth, would you buy or build a house again?
If yes, why? If not, why not? I’m really interested to hear your thoughts! And were there any surprises—positive or negative—that you didn’t expect?
Regards
Interesting question!
My two cents:
I always wanted to live in a detached single-family house. I always wanted a "home theater," a hobby basement, a basketball hoop, and a garden. I was willing to sacrifice quite a bit of my freedom for that.
At the same time, I have felt very comfortable in my current apartment. The rent is 700 EUR for 75 sqm (about 807 sq ft) in Hamburg, which is more than affordable. The street is very quiet and only a 10-minute walk to the city park. Honestly, I could have easily lived here for another 10 years.
While searching for the right plot of land (with or without a house on it), I found one property priced at 540,000 EUR all-in. I almost bought it and committed myself to debt for the next 30 years.
I had (and still have) my financing calculation all figured out and talked myself into it. (6,200 EUR net salary and 120,000 EUR equity).
- "We have more net income than many people who own a single-family house."
- "I have to work anyway."
- "I don’t want to pay rent for others."
- "It’s a great form of retirement investment."
- "Better quality of life than in an apartment."
- "It’s easier to raise children in a house."
- "My salary will never go down. If anything, it will increase."
- "My wife also has to work. The child will go to daycare. That’s better anyway since it helps her maintain independence."
And so on, and so forth...
At the end of the day, I didn’t buy it. My gut feeling didn’t allow it!
Thank God!
Shortly after, I was lucky enough to find the opportunity of a lifetime. Under 100,000 EUR in Hamburg for about 90 sqm (970 sq ft) of living space on a 1,000 sqm (12,000 sq ft) lot directly on the lake. It can be comfortably expanded if necessary and desired.
The house is paid off. Renovations are ongoing. Everything is fine, and I am debt-free and happy.
So… the answer to your question is: No! (If you have to go into debt for 20+ years).
A clear YES! If you get a bargain or have the money to pay off the property within a few years.
Despite having a decent salary, I wasn’t brave enough to buy a single-family house. The debt would have kept me awake at night. I think it’s a personality thing.
Most women tend to see it more relaxed. I guess I can understand why...
My two cents:
I always wanted to live in a detached single-family house. I always wanted a "home theater," a hobby basement, a basketball hoop, and a garden. I was willing to sacrifice quite a bit of my freedom for that.
At the same time, I have felt very comfortable in my current apartment. The rent is 700 EUR for 75 sqm (about 807 sq ft) in Hamburg, which is more than affordable. The street is very quiet and only a 10-minute walk to the city park. Honestly, I could have easily lived here for another 10 years.
While searching for the right plot of land (with or without a house on it), I found one property priced at 540,000 EUR all-in. I almost bought it and committed myself to debt for the next 30 years.
I had (and still have) my financing calculation all figured out and talked myself into it. (6,200 EUR net salary and 120,000 EUR equity).
- "We have more net income than many people who own a single-family house."
- "I have to work anyway."
- "I don’t want to pay rent for others."
- "It’s a great form of retirement investment."
- "Better quality of life than in an apartment."
- "It’s easier to raise children in a house."
- "My salary will never go down. If anything, it will increase."
- "My wife also has to work. The child will go to daycare. That’s better anyway since it helps her maintain independence."
And so on, and so forth...
At the end of the day, I didn’t buy it. My gut feeling didn’t allow it!
Thank God!
Shortly after, I was lucky enough to find the opportunity of a lifetime. Under 100,000 EUR in Hamburg for about 90 sqm (970 sq ft) of living space on a 1,000 sqm (12,000 sq ft) lot directly on the lake. It can be comfortably expanded if necessary and desired.
The house is paid off. Renovations are ongoing. Everything is fine, and I am debt-free and happy.
So… the answer to your question is: No! (If you have to go into debt for 20+ years).
A clear YES! If you get a bargain or have the money to pay off the property within a few years.
Despite having a decent salary, I wasn’t brave enough to buy a single-family house. The debt would have kept me awake at night. I think it’s a personality thing.
Most women tend to see it more relaxed. I guess I can understand why...
Sascha_aus_H16 Oct 2017 16:06chand1986 schrieb:
For the committed renter, freedom of movement and financial freedom are the main priorities. Career opportunities linked to job changes are not hindered by the burden of homeownership. I would like to add another component that I personally consider the most important and that unfortunately is rarely given enough attention. The deciding factor for where I live, and why I wouldn’t change my workplace even for an extra 50,000€ per year, is my social environment. Having my family and friends close to me is more important than financial wealth. That’s why, in my view, renting is often just a "false argument" for flexibility — one that many would never actually use.
Sascha_aus_H schrieb:
I would add another factor that I personally find the most important but which unfortunately is rarely considered. The key reason for choosing where I live, and why I wouldn’t change my workplace even for an extra €50,000 per year, is my social environment. Having my family and friends around me is more important to me than financial wealth. That’s why renting is often just a "false argument" for flexibility that many would never actually use.That is certainly a "false argument" for many people. Sometimes you can’t even clearly explain the real reason for not deciding to buy. Salary fits, partner fits, job fits. Yet sometimes you just have a gut feeling. That shouldn’t be completely ignored. I imagine some know this uneasy feeling but outwardly use "flexibility for work, etc." as the reason.
By the way, I have had great experiences abroad. I definitely wouldn’t have had these if I hadn’t been flexible. Working abroad for years is an experience I wouldn’t want to miss. Never!
I also love my family and friends. However, I preferred to gain personal experiences abroad and to give those people (family and friends) the opportunity to visit me several times. A friend ended up living with me in a small apartment for half a year. But we always knew that we wanted to live long-term in Germany.
I was only able to do all this because I lived in a rental apartment. If I had to pay a monthly mortgage of €1,600 (about $1,700) plus other costs, it wouldn’t have been so easy to do.
C
chand198616 Oct 2017 16:18Sascha_aus_H schrieb:
The key factor for where I live, and why I wouldn’t change my workplace even for an extra €50,000 per year, is my social environment. Having my family and friends around me is more important than financial wealth. That’s why, in my opinion, renting here is often just a “false argument” for flexibility that many would never actually use.Moving for a job doesn’t mean you’re cut off from life, does it?
My moves have been within about 200 km (125 miles) of my “original” location. I can’t say I’ve experienced significant loss of contact. It’s manageable for weekend activities, and what exactly are you missing during the week? Exactly! On the other hand, I met people I wouldn’t have met otherwise. Good experience and often underestimated. New social contacts have their value too.
I wouldn’t relocate for $5,000 per year, but for $50,000 per year? Absolutely. Not because I have no connections, but because from my experience, the fear of losing social contact is completely exaggerated. Those who can maintain relationships can do so from a distance. And those who can’t are just as likely to lose them around the next corner anyway. You just have to be proactive.
In response to the “false argument,” I’d cheekily call it a “fear argument.”
Doesn’t everyone have fears about something?
Everyone is different, so there is no right or wrong, nor any manual to follow.
Some people remain lifelong renters because they fear the responsibilities, or because they don’t want to borrow a large sum of money. And that “large sum” is subjective: one person gets nervous about $150,000, another only balks at $500,000.
Maintaining social connections: not everyone has family ties that keep them anchored to one place. Nevertheless, some people feel more comfortable where they have lived for 30 years. Others can adapt quickly and change their environment overnight.
There are even companies where employees can choose a different desk every day. Some people can handle that, others can’t at all.
Of course, those who think more flexibly have more options. Others have to adjust to circumstances, for example when a partner’s job dictates where they must live. In those cases, people may never feel at home there, whether in a rental apartment or a house.
There are well-paid jobs that require you to live in a specific location. But even then, you might be able to rent a single-family home... Does the thought of purchasing property even come up?
But the question is whether you would build or buy a house again...
When it comes to the effort and work during the construction phase, definitely yes.
I already have new ideas about that.
However, if I had to change, I wouldn’t fixate on buying or renting, or on a house versus an apartment.
I love the independence and spaciousness of a single-family home, but I could also imagine renting something: I don’t really believe in homeownership as a form of retirement planning. However, in our area, rents for, say, a 90m² (970ft²) comfortable apartment are higher than our mortgage payments for 140m² (1,500ft²). Sure, I would then have my equity as liquid assets, but what would it really bring? Of course, I’m attached to my savings, but if it just sits there, I’d probably spend some of it on things I’m currently saving for, like a larger or fancier car, more expensive furniture, a better vacation... Very likely, instead of a private garden, we’d take off in our own motorhome. But you have to be born for that—I don’t see myself stuck in traffic on a weekend, heading to the lake.
So, should you save money for later as retirement provision?
And that brings us back to the idea of homeownership.
And those who find it hard to save? Yes, I don’t always understand why they want to build something expensive of their own at all costs right now.
To each their own also means not following someone else’s mainstream.
(Building a house, getting married, having children... a popular domino effect within social groups)
Everyone is different, so there is no right or wrong, nor any manual to follow.
Some people remain lifelong renters because they fear the responsibilities, or because they don’t want to borrow a large sum of money. And that “large sum” is subjective: one person gets nervous about $150,000, another only balks at $500,000.
Maintaining social connections: not everyone has family ties that keep them anchored to one place. Nevertheless, some people feel more comfortable where they have lived for 30 years. Others can adapt quickly and change their environment overnight.
There are even companies where employees can choose a different desk every day. Some people can handle that, others can’t at all.
Of course, those who think more flexibly have more options. Others have to adjust to circumstances, for example when a partner’s job dictates where they must live. In those cases, people may never feel at home there, whether in a rental apartment or a house.
There are well-paid jobs that require you to live in a specific location. But even then, you might be able to rent a single-family home... Does the thought of purchasing property even come up?
But the question is whether you would build or buy a house again...
When it comes to the effort and work during the construction phase, definitely yes.
I already have new ideas about that.
However, if I had to change, I wouldn’t fixate on buying or renting, or on a house versus an apartment.
I love the independence and spaciousness of a single-family home, but I could also imagine renting something: I don’t really believe in homeownership as a form of retirement planning. However, in our area, rents for, say, a 90m² (970ft²) comfortable apartment are higher than our mortgage payments for 140m² (1,500ft²). Sure, I would then have my equity as liquid assets, but what would it really bring? Of course, I’m attached to my savings, but if it just sits there, I’d probably spend some of it on things I’m currently saving for, like a larger or fancier car, more expensive furniture, a better vacation... Very likely, instead of a private garden, we’d take off in our own motorhome. But you have to be born for that—I don’t see myself stuck in traffic on a weekend, heading to the lake.
So, should you save money for later as retirement provision?
And that brings us back to the idea of homeownership.
And those who find it hard to save? Yes, I don’t always understand why they want to build something expensive of their own at all costs right now.
To each their own also means not following someone else’s mainstream.
(Building a house, getting married, having children... a popular domino effect within social groups)
So, I’m not worried about the loan at all, as long as the payments don’t lower my standard of living. We pay 150 euros more per month compared to the rent. That doesn’t really make much of a difference for us. Besides, inflation also helps to pay off the loan – that always gives me a good feeling.