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
sirhc schrieb:
Admittedly, this was a special situation and, if viewed negatively, could be seen as a bit like tenant hopping.
During my school and training years, I lived with my parents (which nowadays isn’t always a given). I wanted to study and move out to become independent at the same time. By chance, a one-room apartment (32cm (13 inches)²) in a very central location near my university was foreclosed and auctioned, and my father bought it for 11,000 EUR. Since I didn’t receive any student grants, his support was allowing me to live there rent-free during my studies. The total rent would have been 230 EUR per month. So that was the monthly support (not much compared to most other students, but just right in my case – many had a car and an apartment plus more pocket money than that rent— but that’s off-topic). I covered all other costs (phone, internet, mobile, food, drinks, clothes, hobbies) through part-time jobs. This way, I was able to live completely independently throughout my studies.This has absolutely nothing to do with tenant hopping, but rather with a sensible cost-benefit calculation.
It was the best thing your father could have done.
He supported you during your studies while also teaching you independence. Now that you no longer live there, he can sell the apartment again on the regular market, likely making a profit.
Everything was done correctly.
After I took over, the apartment was almost never vacant; it was always rented by students or commuters. As soon as one tenant moved out, the next one was already lined up. Once the apartment reaches 10 years of ownership by my father in two years, it will probably be sold again without having to pay capital gains tax on speculative profit. Personally, things couldn’t have gone better for me. Fortunately, I won’t have the issue with the 10-year holding period because my apartment is used solely as my primary residence. For me, the purchase price, renovation costs, and loan interest will be recovered, and there will likely be a small profit beyond that. I couldn’t have built equity any better myself.
@Hansdampft
Velbert is not Osnabrück and has nothing to do with Neubrandenburg.
Just 5-7 km (3-4 miles) outside Velbert, land prices are already above 500 €/m² (about $46 per ft²) and are getting closer to Düsseldorf levels every day. It seems you don’t even know where Velbert is or what’s happening there. And you obviously have no idea about Osnabrück either – which, by the way, is a prime location.
Comparing Osnabrück and Velbert to Neubrandenburg, where land prices are lower, shows a clear lack of expertise on your part.
I also said: 30% is the limit. You can build within that, depending on your equity and so on. If your location is more expensive, that’s your problem... it simply doesn’t work with 30%. You clearly didn’t properly read my posts. And you respond like this???
You are rude, disrespectful, and completely arrogant toward me. Honestly. You’re the first user I’m adding to my ignore list here.
If I’m unrealistic, then what does that make you? Seriously, man?
My posts don’t deserve responses like yours.
I wish you a good life.
Velbert is not Osnabrück and has nothing to do with Neubrandenburg.
Just 5-7 km (3-4 miles) outside Velbert, land prices are already above 500 €/m² (about $46 per ft²) and are getting closer to Düsseldorf levels every day. It seems you don’t even know where Velbert is or what’s happening there. And you obviously have no idea about Osnabrück either – which, by the way, is a prime location.
Comparing Osnabrück and Velbert to Neubrandenburg, where land prices are lower, shows a clear lack of expertise on your part.
I also said: 30% is the limit. You can build within that, depending on your equity and so on. If your location is more expensive, that’s your problem... it simply doesn’t work with 30%. You clearly didn’t properly read my posts. And you respond like this???
You are rude, disrespectful, and completely arrogant toward me. Honestly. You’re the first user I’m adding to my ignore list here.
If I’m unrealistic, then what does that make you? Seriously, man?
My posts don’t deserve responses like yours.
I wish you a good life.
Phew, the reaction is a bit exaggerated. Hansdampf simply has an opinion that doesn’t quite align with the typical viewpoint here. If you visit any random finance or investment forum, the opinion that building a house is financially better than renting is practically no longer common (which of course doesn’t mean someone can’t still want to buy a house). The belief that owning a house is financially the only right choice is usually found only in home construction and financing forums (one might be suspicious...) and casual social gatherings.
The truth probably lies somewhere in the middle, as all the calculations depend on numerous factors (inflation, price trends, stock market performance, maintenance costs, timing of sale, etc.). Small changes in any of these factors can be interpreted to support either side, which makes the discussion far from straightforward.
And it should really not be doubted that Velbert’s price levels are not comparable to expensive locations in major cities. You can easily check property value benchmarks on Boris.nrw.de. Yes, I’m from NRW myself and know the area. But ultimately, it doesn’t really matter who has which land prices where. Be glad that housing is still affordable in Velbert.
The general 30% rule might serve as a slight indicator for a certain income group, but that’s about it. If my family income is 10,000 net with no children, I can comfortably afford 60%. But if it’s only 4,000 net with 2 children, 60% would usually mean financial ruin.
The truth probably lies somewhere in the middle, as all the calculations depend on numerous factors (inflation, price trends, stock market performance, maintenance costs, timing of sale, etc.). Small changes in any of these factors can be interpreted to support either side, which makes the discussion far from straightforward.
And it should really not be doubted that Velbert’s price levels are not comparable to expensive locations in major cities. You can easily check property value benchmarks on Boris.nrw.de. Yes, I’m from NRW myself and know the area. But ultimately, it doesn’t really matter who has which land prices where. Be glad that housing is still affordable in Velbert.
The general 30% rule might serve as a slight indicator for a certain income group, but that’s about it. If my family income is 10,000 net with no children, I can comfortably afford 60%. But if it’s only 4,000 net with 2 children, 60% would usually mean financial ruin.