Hello everyone,
My wife, my daughter, and I are looking to build our own home (single-family house). We might have a second child in the future. The house will be built in the postal code area 77XXX. Since I have a very time-consuming job and I’m not very skilled with DIY work, I want to have the whole project delivered as move-in ready as possible, without too much coordination effort. What is the best way to achieve this?
Our requirements:
- 5 rooms with two bathrooms that have showers (children’s bathroom)
- This summer showed me that I don’t want to build a house without cooling. I’m open regarding the cooling concept, but I have heard good things about heat pumps including a cooling function plus a photovoltaic system. What are sensible options? Underfloor heating / wall heating / ceiling cooling?
- A complicated/individual ground floor layout because I want to integrate a home cinema (my hobby) into the living room. Cooperation with the home cinema installer will also be necessary. If anyone has experience with how to manage this, I would appreciate any advice.
- Lighting and roller shutters should be smart. Here the question arises whether to go for retrofit solutions (Philips Hue) or a bus system like KNX combined with home automation such as RTI or Control4?
- No specific requirements regarding the exterior design. I would also consider a mono-pitched roof to install a full photovoltaic system facing south and keep the rest of the building simple, square, and practical.
- Avoid sloped ceilings upstairs, which also speaks in favor of a mono-pitched or hipped roof (urban villa style).
How should all this be financed?
He: net income 5,500 € (tendency rising)
She: net income 800 € (we don’t count on this, since a second child might be coming)
Equity: 30,000 € saved within one year. Within the next few years, there might also be an inheritance of 250,000 €. I would consider buying a suitable plot now even without much equity and use the remaining money/inheritance for additional loan repayments. What do you think about that?
Best regards!
My wife, my daughter, and I are looking to build our own home (single-family house). We might have a second child in the future. The house will be built in the postal code area 77XXX. Since I have a very time-consuming job and I’m not very skilled with DIY work, I want to have the whole project delivered as move-in ready as possible, without too much coordination effort. What is the best way to achieve this?
Our requirements:
- 5 rooms with two bathrooms that have showers (children’s bathroom)
- This summer showed me that I don’t want to build a house without cooling. I’m open regarding the cooling concept, but I have heard good things about heat pumps including a cooling function plus a photovoltaic system. What are sensible options? Underfloor heating / wall heating / ceiling cooling?
- A complicated/individual ground floor layout because I want to integrate a home cinema (my hobby) into the living room. Cooperation with the home cinema installer will also be necessary. If anyone has experience with how to manage this, I would appreciate any advice.
- Lighting and roller shutters should be smart. Here the question arises whether to go for retrofit solutions (Philips Hue) or a bus system like KNX combined with home automation such as RTI or Control4?
- No specific requirements regarding the exterior design. I would also consider a mono-pitched roof to install a full photovoltaic system facing south and keep the rest of the building simple, square, and practical.
- Avoid sloped ceilings upstairs, which also speaks in favor of a mono-pitched or hipped roof (urban villa style).
How should all this be financed?
He: net income 5,500 € (tendency rising)
She: net income 800 € (we don’t count on this, since a second child might be coming)
Equity: 30,000 € saved within one year. Within the next few years, there might also be an inheritance of 250,000 €. I would consider buying a suitable plot now even without much equity and use the remaining money/inheritance for additional loan repayments. What do you think about that?
Best regards!
S
Steffen8010 Sep 2018 10:00Climbee schrieb:
And this is in Thuringia, if I understand correctly, right Steffen? In Baden-Württemberg the prices might be slightly higher...Correct. Although here it’s a very good location locally. Large lake within walking distance..
S
Steffen8010 Sep 2018 10:10Addendum about the home theater: We realized it together with a home theater specialist. It’s important to involve them early on. The full integration is quite complex. Especially Dolby Atmos with proper ceiling speakers (we use all Nubert, with WS-14 on the ceiling). All the equipment is connected via a bus system. Voice command “Alexa, theater” lowers the screen, closes all the blinds, starts the projector, HTPC in the utility room, and AVR, and sets a specific lighting scene. It also switches off the refrigerator (unfortunately necessary because of the side-by-side fridge and open living area). The room size is about 65 square meters (700 square feet). Smaller wouldn’t be ideal. The cost for the home theater should have been less than 50,000 (currency not specified). Projector 10,000, TV 4,500, screen 6,000, AVR 3,000, speakers 8,000, plus the labor costs (drywall etc.). In total, maybe around 35,000. Pay attention to dark walls behind the screen and on the sides. We found a nice solution with a dark red structural wallpaper. It looks very good and works perfectly for the theater. High-end projector recommended, e.g., Sony VW760ES.
Based on the title, I assumed you had plenty of equity. Unfortunately, that is not the case. The reason doesn’t really matter for the loan at this point. Your equity is not even enough to cover the additional purchase costs if you buy through a developer.
As many have already pointed out here, the inheritance will not interest the bank. Your bonus will likely be acknowledged favorably but will not improve your loan conditions.
The principle is actually quite simple. Comfortable equity secures you favorable interest rates and therefore manageable monthly payments over the fixed interest period. Your monthly income pays off the house. Plain and simple.
So, what is comfortable equity? For me, that would be, for example, an 80% mortgage loan-to-value ratio (excluding additional purchase costs). Another way to calculate it is that after deducting the loan installment and monthly running costs, about 67-70% of your monthly income should remain available. With three children, this leftover amount may need to be higher than with just one child. This should be calculated individually.
At the current situation, you won’t get good terms and will face a high monthly payment on the loan amount you mentioned, which you need to cover with your monthly income.
If you don’t want to take any action yourself, then you will have to buy a turnkey new build including the plot from a developer. However, many extras will be omitted—not because the developer doesn’t want to include them, but because these options deviate so much from the developer’s standard that you would end up paying two to three times more compared to individual tradespeople. Then you will probably lack understanding of the costs, believe me.
As many have already pointed out here, the inheritance will not interest the bank. Your bonus will likely be acknowledged favorably but will not improve your loan conditions.
The principle is actually quite simple. Comfortable equity secures you favorable interest rates and therefore manageable monthly payments over the fixed interest period. Your monthly income pays off the house. Plain and simple.
So, what is comfortable equity? For me, that would be, for example, an 80% mortgage loan-to-value ratio (excluding additional purchase costs). Another way to calculate it is that after deducting the loan installment and monthly running costs, about 67-70% of your monthly income should remain available. With three children, this leftover amount may need to be higher than with just one child. This should be calculated individually.
At the current situation, you won’t get good terms and will face a high monthly payment on the loan amount you mentioned, which you need to cover with your monthly income.
If you don’t want to take any action yourself, then you will have to buy a turnkey new build including the plot from a developer. However, many extras will be omitted—not because the developer doesn’t want to include them, but because these options deviate so much from the developer’s standard that you would end up paying two to three times more compared to individual tradespeople. Then you will probably lack understanding of the costs, believe me.
Zaba12 schrieb:
If you don’t want to lift a finger, you have to buy a new build with land from a developer. But many extras will be left out—not because the developer doesn’t want to install them, but because they deviate so much from the developer’s standard that you would have to pay two to three times as much compared to hiring individual tradespeople.The desire for a home cinema and the comment by @Steffen80 about the size point toward an architect-designed house. That will get expensive if you have to pay for building supervision.
Of course, it’s quite a statement that electrical work, often considered a given by many—even if someone isn’t skilled—is not wanted.
You also have to consider that other builders work hard too, usually with limited time, and first have to learn the craft.
Isn’t that wonderful? You’re not alone.
kaho674 schrieb:
Sounds to me like sudden megalomania with Hollywood-style delusions. Put 300 grand on the table first – then come back. The original poster is not the first here, and unfortunately won’t be the last with such expectations.
As an employee, you shouldn’t be blinded by your own salary. Together, your income amounts to two well-paying full-time salaries. If your wife were to contribute an additional 3,000 (currency not specified) per month, the discussion would be different. The missing equity wouldn’t be fully compensated, but 100-105% financing would be more manageable. Although the total costs including interest would still be frightening, sometimes you have to accept that when no significant equity is available.
Recently, someone here wanted to buy a house for 950,000€ and borrow 680,000€ with a salary of 7,500€ per month. The advice was against it since the poster calculated a payment of 1,800€ per month.
In your case, borrowing 750,000€ at 2% amortization over 20 years fixed interest would mean a payment of around 2,900€ per month (100% financing). Including monthly utilities and other housing costs, you would pay about 3,300–3,400€ per month for housing. That is already over 50% of your household income. You are far from the healthy 30%.