I live in a booming area and had been searching for a plot or a house for a long time. When I see the prices on real estate platforms like Immoscout, I often get really frustrated. Especially the following things bother me:
- A developer offers a very expensive, ugly plot at an inflated price, but that’s not all: you also have to build an outrageously expensive house with them, so that a single-family home in a small town ends up costing almost 600,000 euros. "Living close to nature"
- Nearly dilapidated single-family houses from the 1960s with 90 square meters (970 square feet) of living space are offered at prices for which you could buy a new single-family home of 120 square meters (1,290 square feet) with 100,000 euros more. "A fixer-upper for the handy family"
- "Land with development potential" is sold at prices between 40 to 50% of regular plot prices, but a call to the local authority reveals notes such as "nature reserve," "archaeological sites," "water protection area," or that the land is planned to remain agricultural for an even longer period.
- Naive private sellers demand sky-high prices: renovated houses from the 1970s costing more than a new build plus land. "Absolutely like-new gem" (despite being almost 50 years old)
- Small villages with around 1,000 residents, located 100 kilometers (62 miles) away, are described as being within the "Munich catchment area" just because you can reach a train station in 30 minutes, with trains that take 50 more minutes to get to Munich.
Sometimes I really feel like telling people that what they’re doing is almost misleading and exploitative. It seems like many are just waiting for the one "fool" who’s willing to pay one and a half to twice the market value.
Just wanted to share this... I’m sure the insights from this thread aren’t all that profound.
- A developer offers a very expensive, ugly plot at an inflated price, but that’s not all: you also have to build an outrageously expensive house with them, so that a single-family home in a small town ends up costing almost 600,000 euros. "Living close to nature"
- Nearly dilapidated single-family houses from the 1960s with 90 square meters (970 square feet) of living space are offered at prices for which you could buy a new single-family home of 120 square meters (1,290 square feet) with 100,000 euros more. "A fixer-upper for the handy family"
- "Land with development potential" is sold at prices between 40 to 50% of regular plot prices, but a call to the local authority reveals notes such as "nature reserve," "archaeological sites," "water protection area," or that the land is planned to remain agricultural for an even longer period.
- Naive private sellers demand sky-high prices: renovated houses from the 1970s costing more than a new build plus land. "Absolutely like-new gem" (despite being almost 50 years old)
- Small villages with around 1,000 residents, located 100 kilometers (62 miles) away, are described as being within the "Munich catchment area" just because you can reach a train station in 30 minutes, with trains that take 50 more minutes to get to Munich.
Sometimes I really feel like telling people that what they’re doing is almost misleading and exploitative. It seems like many are just waiting for the one "fool" who’s willing to pay one and a half to twice the market value.
Just wanted to share this... I’m sure the insights from this thread aren’t all that profound.
Kekse schrieb:
When it comes to prices, the child benefit for builders doesn’t make much difference anymore. What are 12,000 to 36,000 euros for a million anyway, that are paid out over 10 years starting about one year after construction, which don’t even qualify as equity but are “only” usable for special repayments? Anyone who can finance a million euros for a house won’t qualify for this child benefit. But in the relevant price range of 350,000€–550,000€ (approx. $380,000–600,000) an additional amount of 24,000€–40,000€ (approx. $26,000–44,000) on top for two children across Germany or Bavaria does make a significant difference. And this is exactly what will happen starting this autumn for almost three years and is expected to intensify until the end of 2021.
Men, women, trans individuals, sit back and think. What we are experiencing is called inflation, the devaluation of money due to low interest rates. A rough calculation: borrowing 100,000 at 1% interest costs 1,000 per year and 20,000 over 20 years; with 5% interest, 100,000 becomes 265,000 over 20 years. So, a property that costs 300,000 at 5% interest could cost 240,000 more at 1%, totaling 540,000. This is exactly what we are seeing right now. The ideal scenario is a 1% interest rate and a price of 300,000, but that is not how economics works. Those who could afford to build at 5% interest for 300,000 can also afford 540,000 at 1%, and vice versa. Unfortunately, building in booming areas has never been affordable for everyone; in outlying areas, the situation is more relaxed, and cheaper money actually makes properties more affordable.
Nordlys schrieb:
Men, women, everyone, take a moment and think this through. What we’re experiencing is called inflation—money losing value due to low interest rates. A rough calculation: borrowing 100,000 at 1% interest costs 1,000 annually and 20,000 over 20 years; at 5% interest, 100,000 costs the full amount after 20 years. So, a property that costs 300,000 at 5% interest can cost 240,000 euros more—540,000 total—at 1% interest. This is exactly what we’re seeing right now. The ideal is 1% interest with a price of 300,000, but real economics doesn’t work that way. Someone who could build for 300,000 at 5% interest can also do it for 540,000 at 1%, and vice versa. Unfortunately, building in high-demand areas has never been affordable for everyone; in less popular locations, the situation is more relaxed, as cheap money actually makes real estate more affordable. I like your sense of humor.
Nice thread, but what is it doing in the IKEA furniture assembly help section?
My two cents: we worked for two years to finally get permission to build. Just how much costs have risen during that time is enough to make you sweat.
And yes, we live in the Greater Munich area, 70 km (43 miles) from the city. You can’t get a single-family home here for under half a million, and they don’t even have to be in a great location.
Friends of ours moved even further west for that reason—longer commute, but at least affordable.
If we didn’t already own the land here, we couldn’t afford the house. And honestly, this isn’t my dream plot. It’s too close to the neighbors and has no view. But there’s simply no land left to buy here, and if there is, it costs you €300 - 400 per sqm (about $33 - 44 per sq ft).
My two cents: we worked for two years to finally get permission to build. Just how much costs have risen during that time is enough to make you sweat.
And yes, we live in the Greater Munich area, 70 km (43 miles) from the city. You can’t get a single-family home here for under half a million, and they don’t even have to be in a great location.
Friends of ours moved even further west for that reason—longer commute, but at least affordable.
If we didn’t already own the land here, we couldn’t afford the house. And honestly, this isn’t my dream plot. It’s too close to the neighbors and has no view. But there’s simply no land left to buy here, and if there is, it costs you €300 - 400 per sqm (about $33 - 44 per sq ft).
Climbee schrieb:
then you’re looking at 300 - 400 € per sqm (10 - 13 USD per sqft). Not more for the commuter belt?