Hello everyone,
Since I started exploring the topic of house construction two months ago, I have now registered on this forum.
A brief introduction about me and my wife: We are both employed (civil engineer and real estate assistant) with a net income of 4xxx.
Equity capital: 50,000 euros.
One would actually assume that with this equity and net income, buying a property should be easy. However, since I do not want to repay a loan over 30-35 years but rather a maximum of 25 years, and I don’t want to fully stretch the limit, the monthly installment and therefore the total amount quickly become restricted. A total of 250,000 net plus additional construction costs equivalent to the equity capital would be the limit here. In Berlin and its surrounding area? Practically unthinkable.
I am a civil engineer (although specializing in concrete repair and thus not an expert in single-family houses, etc.) and can therefore assess construction prices, combined with my wife’s interest in the real estate sector, allowing us to understand the high general prices for land.
With 250,000 net plus additional construction costs, there is generally not much you can do nationwide for new builds — this is my initial assessment.
There has already been a lot of discussion here in other threads about construction costs, potential capital, and what is needed. When I see bargain houses on TV, I also facepalm. My assumption is that such homes don’t bring much joy. Heating systems, plumbing, electrical installations, thermal insulation — these are often overestimated.
Currently, I am researching prefabricated houses with self-finishing options. However, I do have some concerns, even though I assume that nowadays the materials at least meet certain standards.
So, what are the options?
Being bound for 30 years and pushing the loan to the limit?
House auctions?
Hoping for a bargain plot including an affordable prefab house as a self-build (lots of work and potentially many worries)
Since I plan to start building within the next 24-36 months, my initial findings are sobering.
At least the construction company I work for could provide the foundation slab plus groundwork like drainage, etc., at a low cost. I also know structural engineers and others involved. Maybe the project can be realized with a “small” budget thanks to these circumstances.
Has anyone managed to do this before?
Since I started exploring the topic of house construction two months ago, I have now registered on this forum.
A brief introduction about me and my wife: We are both employed (civil engineer and real estate assistant) with a net income of 4xxx.
Equity capital: 50,000 euros.
One would actually assume that with this equity and net income, buying a property should be easy. However, since I do not want to repay a loan over 30-35 years but rather a maximum of 25 years, and I don’t want to fully stretch the limit, the monthly installment and therefore the total amount quickly become restricted. A total of 250,000 net plus additional construction costs equivalent to the equity capital would be the limit here. In Berlin and its surrounding area? Practically unthinkable.
I am a civil engineer (although specializing in concrete repair and thus not an expert in single-family houses, etc.) and can therefore assess construction prices, combined with my wife’s interest in the real estate sector, allowing us to understand the high general prices for land.
With 250,000 net plus additional construction costs, there is generally not much you can do nationwide for new builds — this is my initial assessment.
There has already been a lot of discussion here in other threads about construction costs, potential capital, and what is needed. When I see bargain houses on TV, I also facepalm. My assumption is that such homes don’t bring much joy. Heating systems, plumbing, electrical installations, thermal insulation — these are often overestimated.
Currently, I am researching prefabricated houses with self-finishing options. However, I do have some concerns, even though I assume that nowadays the materials at least meet certain standards.
So, what are the options?
Being bound for 30 years and pushing the loan to the limit?
House auctions?
Hoping for a bargain plot including an affordable prefab house as a self-build (lots of work and potentially many worries)
Since I plan to start building within the next 24-36 months, my initial findings are sobering.
At least the construction company I work for could provide the foundation slab plus groundwork like drainage, etc., at a low cost. I also know structural engineers and others involved. Maybe the project can be realized with a “small” budget thanks to these circumstances.
Has anyone managed to do this before?
Joedreck schrieb:
And I still maintain: the smart person rents their home and owns property they rent out. A good combination.
Everyone does what they can... and if I have to borrow $400,000 from the bank, then I simply CAN’T.
ypg schrieb:
With your math skills anyway. ypg schrieb:
You must know... And from some comments, you can tell that some people can’t, but they did it anyway.
Wow...
Everyone has to weigh for themselves what the "better" option is. There's really no point in trying to convince everyone of their "right" opinion here. If someone prefers to rent their whole life, that’s perfectly fine… Some simply don’t value ownership that much. However, this is a HOUSE BUILDING forum. It’s about building houses, which usually involves financing through banks. If you can pay cash, great, but some either can’t or don’t want to wait that long until this money actually belongs to them.
As for me, my wife and I currently rent, and next year we will buy a house at a reasonable price, not in the high ranges mentioned here. We decided that the mortgage payment shouldn’t be higher than our current rent excluding utilities. We are already saving well and can continue the loan repayment maintaining that budget. I see financing as essentially claiming my money now, which I just earn later through my salary.
In a few years, I will have finished paying off the loan, and then I can only build savings and live rent-free in a house without paying rent. Whether that is in retirement or sooner. Natural disasters like divorce or death can always happen, are insurable, and definitely not predictable. If someone assumes they will get divorced someday, then they shouldn’t buy a house or take on financing with their partner at all. Using that as a reason to never sign a contract with a bank is complete nonsense!
Savings remain the same, and if something unexpected happens or repairs are needed, I simply use those funds. It’s no different than renting—except that with rent you essentially pay the landlord’s financing plus maintenance costs in advance. When renting, you are basically repaying your landlord’s mortgage and they are also building reserves for repairs as needed.
I’m not trying to discourage anyone from renting, but in the end, renting means you “only” get housing and end up with zero equity to sell, whether you want to or not.
With ownership, I pay the bank a small “rent” (interest), put my money back into what I already effectively earned (principal repayment), and build savings. In the end, I have property that sells well, plus my salary/pension.
Of course, owning a house costs a little more than just paying rent, but at the end of the tunnel called financing, there is a house that belongs to me—not a landlord to whom I must keep paying indefinitely.
Everyone has to weigh for themselves what the "better" option is. There's really no point in trying to convince everyone of their "right" opinion here. If someone prefers to rent their whole life, that’s perfectly fine… Some simply don’t value ownership that much. However, this is a HOUSE BUILDING forum. It’s about building houses, which usually involves financing through banks. If you can pay cash, great, but some either can’t or don’t want to wait that long until this money actually belongs to them.
As for me, my wife and I currently rent, and next year we will buy a house at a reasonable price, not in the high ranges mentioned here. We decided that the mortgage payment shouldn’t be higher than our current rent excluding utilities. We are already saving well and can continue the loan repayment maintaining that budget. I see financing as essentially claiming my money now, which I just earn later through my salary.
In a few years, I will have finished paying off the loan, and then I can only build savings and live rent-free in a house without paying rent. Whether that is in retirement or sooner. Natural disasters like divorce or death can always happen, are insurable, and definitely not predictable. If someone assumes they will get divorced someday, then they shouldn’t buy a house or take on financing with their partner at all. Using that as a reason to never sign a contract with a bank is complete nonsense!
Savings remain the same, and if something unexpected happens or repairs are needed, I simply use those funds. It’s no different than renting—except that with rent you essentially pay the landlord’s financing plus maintenance costs in advance. When renting, you are basically repaying your landlord’s mortgage and they are also building reserves for repairs as needed.
I’m not trying to discourage anyone from renting, but in the end, renting means you “only” get housing and end up with zero equity to sell, whether you want to or not.
With ownership, I pay the bank a small “rent” (interest), put my money back into what I already effectively earned (principal repayment), and build savings. In the end, I have property that sells well, plus my salary/pension.
Of course, owning a house costs a little more than just paying rent, but at the end of the tunnel called financing, there is a house that belongs to me—not a landlord to whom I must keep paying indefinitely.
And continuing from the original post:
If you believe that you can manage to get a house for the price you have in mind, plus the land and additional costs, then that’s fine. What is the purpose of this thread if you will succeed anyway and the opinions and questions here are just attacks on you?
If you believe that you can manage to get a house for the price you have in mind, plus the land and additional costs, then that’s fine. What is the purpose of this thread if you will succeed anyway and the opinions and questions here are just attacks on you?
face26 schrieb:
Are we really going to start the hundredth thread about whether renting or building a house is better?
Soon we’ll be back to comparing calculations, and some will get into heated arguments over assumed compound interest rates and opportunity costs. There’s a saying in Swabia:
I’ll just shut my mouth now...
These comparisons are complete nonsense.
Not only do some compare the cold rent of a probably 100cm (1 meter)² (about 1,000 square feet) older apartment with a 150cm (1.5 meters)² (about 1,600 square feet) newly built single-family home, but some of the calculations are just maddening.
This is a house-building forum, not a rent-makes-me-much-richer forum. So, rent if you want to, but don’t try to convince others here. It’s like going into a vegan restaurant with a ring of bologna and talking about iron deficiency!