Hello,
I have a fundamental question about purchasing land that is not focused on the financial aspect but rather on the general principle:
The situation is as follows:
My wife and I have wanted to move back to our hometown (about 15,000 inhabitants), located 40 kilometers (25 miles) east of Frankfurt, for some time now. We started looking for a plot this summer and did not expect to find one so quickly. We are now close to buying what we consider a dream plot, exactly as we had always imagined. The plot is almost square, located in a (significantly) upscale, well-established residential area, at the edge of a forest, flat terrain, with a view into the valley. From what I can see in the city’s cadastral plans, it is one of the last plots of its kind. All other available plots in the established neighborhoods have significant drawbacks in terms of location or shape, in our opinion. The areas designated by the city as building land / planning permission zones have plots sized between 450 and 550 square meters (about 4,800 to 5,900 square feet). These are too small for us, and we do not want to move into a new development where there will be construction noise for the next ten years.
The price per square meter of our plot is 200 euros. The city’s plots are priced between 150 and 170 euros per square meter. My wife and I are aware that a plot of this type and quality in our hometown might not be available again anytime soon, or possibly never. The real estate agent told us, however, that the plot has been on the market for six years. He had many viewings, and all interested parties admired the property, but according to the agent, the price for this area is considered “luxury level,” especially since the city offers much cheaper alternatives.
Here is our problem: We want the plot. But we cannot say with 100% certainty whether we will build on it ourselves. I would estimate the probability at 80 to 90 percent. The reason is that I currently work as a civil servant in the state capital, which is 90 kilometers (56 miles) away from the plot, but a transfer to a nearby office is possible. However, my employer has selected me for career advancement opportunities. I am currently seconded to a ministry and will be there for at least another one and a half years, if all goes well. Every additional day there improves my career prospects. Career advancement, however, in a large federal state also means geographical flexibility. So, I cannot say for sure where I might be assigned. On the other hand, I could also decide against pursuing a career and move to a local office near the plot at any time. It would also be possible to balance career and building on the plot, as there are enough promotion opportunities in the surrounding area.
Given these circumstances, would you buy the plot? We can cover the purchase price (about 180,000 euros in total including all additional costs) from our own capital. My concern is the possibility that we might suddenly be relocated elsewhere for work. This worries me because the agent said he couldn’t sell the plot for six years due to the price. Therefore, I wonder whether we would be able to sell the plot without a loss and whether there is any chance of making even a small profit. I have two siblings who both live in our hometown and intend to stay. Both will likely need to buy plots within the next five years. It might be possible to sell it to one of them. I also have some hope because of the proximity to Frankfurt (the connection is very good, with train station and highway). In a nearby town (about 10 kilometers / 6 miles closer to Frankfurt), comparable plots already cost more than 200,000 euros. If Brexit goes through, prices will probably rise further.
In short: I am thinking about whether this plot should be seen as an opportunity for returning home or as a burden considering our (professional) future.
I would appreciate any input.
I have a fundamental question about purchasing land that is not focused on the financial aspect but rather on the general principle:
The situation is as follows:
My wife and I have wanted to move back to our hometown (about 15,000 inhabitants), located 40 kilometers (25 miles) east of Frankfurt, for some time now. We started looking for a plot this summer and did not expect to find one so quickly. We are now close to buying what we consider a dream plot, exactly as we had always imagined. The plot is almost square, located in a (significantly) upscale, well-established residential area, at the edge of a forest, flat terrain, with a view into the valley. From what I can see in the city’s cadastral plans, it is one of the last plots of its kind. All other available plots in the established neighborhoods have significant drawbacks in terms of location or shape, in our opinion. The areas designated by the city as building land / planning permission zones have plots sized between 450 and 550 square meters (about 4,800 to 5,900 square feet). These are too small for us, and we do not want to move into a new development where there will be construction noise for the next ten years.
The price per square meter of our plot is 200 euros. The city’s plots are priced between 150 and 170 euros per square meter. My wife and I are aware that a plot of this type and quality in our hometown might not be available again anytime soon, or possibly never. The real estate agent told us, however, that the plot has been on the market for six years. He had many viewings, and all interested parties admired the property, but according to the agent, the price for this area is considered “luxury level,” especially since the city offers much cheaper alternatives.
Here is our problem: We want the plot. But we cannot say with 100% certainty whether we will build on it ourselves. I would estimate the probability at 80 to 90 percent. The reason is that I currently work as a civil servant in the state capital, which is 90 kilometers (56 miles) away from the plot, but a transfer to a nearby office is possible. However, my employer has selected me for career advancement opportunities. I am currently seconded to a ministry and will be there for at least another one and a half years, if all goes well. Every additional day there improves my career prospects. Career advancement, however, in a large federal state also means geographical flexibility. So, I cannot say for sure where I might be assigned. On the other hand, I could also decide against pursuing a career and move to a local office near the plot at any time. It would also be possible to balance career and building on the plot, as there are enough promotion opportunities in the surrounding area.
Given these circumstances, would you buy the plot? We can cover the purchase price (about 180,000 euros in total including all additional costs) from our own capital. My concern is the possibility that we might suddenly be relocated elsewhere for work. This worries me because the agent said he couldn’t sell the plot for six years due to the price. Therefore, I wonder whether we would be able to sell the plot without a loss and whether there is any chance of making even a small profit. I have two siblings who both live in our hometown and intend to stay. Both will likely need to buy plots within the next five years. It might be possible to sell it to one of them. I also have some hope because of the proximity to Frankfurt (the connection is very good, with train station and highway). In a nearby town (about 10 kilometers / 6 miles closer to Frankfurt), comparable plots already cost more than 200,000 euros. If Brexit goes through, prices will probably rise further.
In short: I am thinking about whether this plot should be seen as an opportunity for returning home or as a burden considering our (professional) future.
I would appreciate any input.
G
garfunkel21 Oct 2017 15:32Perhaps a more important question is whether you have already made your decision and are putting your career on hold? Would both of you actually leave Frankfurt for a good job opportunity somewhere in Germany and sell the property?
Often, you don’t know if you will live permanently in the new location—maybe just for 10 years? And then what?
I have the impression that almost everyone who buys or builds a property has decided to settle permanently in that place. For myself, I’m currently unsure if that was the right choice. For example, a few weeks ago, I had to turn down a job offer abroad because the income wouldn’t have covered a loan here in Germany and living abroad didn’t really work financially.
I do regret not taking that offer. Simply because I now miss out on the experience, and that position also had certain potential.
Next week, I have a meeting with the bank to explore options, like reducing the loan payments, so I might still be able to move abroad if another opportunity comes up. If I had been renting instead, all of this would have been much easier, and I might soon be living near São Paulo.
It’s a shame, so think carefully about it.
Often, you don’t know if you will live permanently in the new location—maybe just for 10 years? And then what?
I have the impression that almost everyone who buys or builds a property has decided to settle permanently in that place. For myself, I’m currently unsure if that was the right choice. For example, a few weeks ago, I had to turn down a job offer abroad because the income wouldn’t have covered a loan here in Germany and living abroad didn’t really work financially.
I do regret not taking that offer. Simply because I now miss out on the experience, and that position also had certain potential.
Next week, I have a meeting with the bank to explore options, like reducing the loan payments, so I might still be able to move abroad if another opportunity comes up. If I had been renting instead, all of this would have been much easier, and I might soon be living near São Paulo.
It’s a shame, so think carefully about it.
K
Knallkörper21 Oct 2017 16:08There are currently plenty of job offers for expats in the plant construction and oil/gas sector in Mexico. For good reason, hardly anyone wants to do it. Better to choose Oman or Iran. With a position like that, the loan repayment shouldn’t be an issue. The net salary is at least 5,000 with free accommodation.
K
Karlstraße21 Oct 2017 16:13It was similar for us, also 40km (25 miles) east of Frankfurt :-) Our owners held onto it for a long time, but on one hand, the price was also rather high, and on the other hand, they secretly wanted to sell to a young family, if they were going to sell at all. They never actually needed the money.
Where is your plot located? Feel free to send a private message.
Where is your plot located? Feel free to send a private message.
G
garfunkel21 Oct 2017 18:07@Knallkörper
Which organizations or companies are supposed to be these? You often hear about such questionable sources that can supposedly be obtained anywhere at any time, but when you actually check where these sources are offered, nothing can be found.
Sorry for the off-topic 🙂
Which organizations or companies are supposed to be these? You often hear about such questionable sources that can supposedly be obtained anywhere at any time, but when you actually check where these sources are offered, nothing can be found.
Sorry for the off-topic 🙂