ᐅ Renovation of an Existing Property – Our Journey to a Home
Created on: 13 Jun 2019 14:38
L
LordNibbler
Since returning to Wolfsburg in 2017, we had been searching for a property. Initially, we rented to take our time finding the right house and to test the real estate agents.
Of course, properties meeting these criteria were expensive and scarcely available. The first viewings were disappointing:
Then, at the beginning of 2018, an offer came up that didn’t fully meet our criteria but was in the same neighborhood.
The house was actually larger than we needed, but the structure and architecture were excellent. Renovations were manageable (utility lines easily accessible, partly in shafts), and the leasehold was acceptable because the owners had prepaid their installments (there was a discount), so the annual fee was only 500€ (~$540). The leaseholder is the city of Wolfsburg, which by statute only raises interest rates upon resale (not during the lease term or inheritance). When purchasing the plot, the land value is calculated by the benchmark land value minus the redemption amount and with a 15% discount. In mid-2017, the offer for the land was therefore 118,000€ (~$128,000) (with today’s benchmark land value it would be about 150,000€ (~$162,000)). This was a bargain for the area and was included in the asking price according to the agent.
Still, after a second viewing with experts (not appraisers), we found enough arguments (wall crack, renovation needs) to negotiate the price down to 420,000€. The public offer was then reduced to 435,000€ (~$470,000).
A financing broker secured approval from the local savings bank (Sparkasse) for the mortgage (leasehold is a bit special here, mostly local banks are familiar). It was feasible as a 20-year full repayment loan (leasehold agreement had to be valid for at least another 10 years), with a potential buffer to save up the land price.
But there was one issue: the over-90-year-old occupant. She was looking for an apartment in a senior residence (ground floor, lake view). Every week we heard it was only a matter of days until one would become available. In the end, by mid-April, we had a reservation with ownership transfer no later than December, possibly sooner. So we committed to financing and arranged the notary appointment...
...and then a week later, there was a request for a meeting (bypassing the notary). The niece and sister explained that the reservation was declared invalid. The time pressure was too great. It wasn’t certain the apartment would be available yet. They felt the elderly woman couldn’t be expected to move into a care home. They wanted a purchase contract with more time — about a year (implicitly without a strict limit).
We only had 6 months interest-free financing extension, but could imagine a few more months. However, only with financial compensation (1,500€/month rental cost difference). The counterproposal was to buy as planned but with ownership transfer only after the occupant moves out (essentially the right to live there). This was not acceptable (due to hardship rules; in the end you own the house but cannot evict the old resident). The only outcome was an informal understanding: we remained interested, please inform us when the senior residence is arranged; if we find something else in the meantime we will get back to you. The agent (VR-Bank) was not very pleased since it had been difficult to get the three women to agree before. It wasn’t her fault; the dossier was the best prepared with all necessary documents and missing items obtained promptly.
Two weeks later there was another interested party. Moral of the story: we successfully lowered the price for others but they moved in in October 2017.
Here are some floor plans of the property as inspiration for other house planners:
The agent mentioned that in the residential area, maybe one property sells every 1–2 years. The rest are sold privately. Since we moved in, three houses have been demolished and replaced by new builds twice the size. Another is still a shell and is receiving a huge extension. None of these properties were publicly marketed...
...the search continues in the next post and how we finally found our home.
- detached single-family house (so no semi-detached houses)
- within walking distance to the city centers of Wolfsburg, Fallersleben, or Vorsfelde
- for existing buildings, construction year from 1960 onwards, even if not renovated, as long as the structure justifies investment (otherwise you pay for poor renovations that need to be redone)
- for new builds, located in a residential area with a coherent design concept (many new developments unfortunately look like model home neighborhoods where every option from the catalog has been used, but without creating a harmonious living environment)
- a larger garden with usable space
- no leasehold (common in this area)
Of course, properties meeting these criteria were expensive and scarcely available. The first viewings were disappointing:
- 5-year-old house in a new development: walls with cracks, water stains (from the foundation slab), unoccupied, agent said normal settlement cracks (but wrong direction and too large), suspected upward ground movement due to Posidonia shale underground according to the land use plan and construction errors
- 8-year-old house in the same development: not legally divided plot (3 houses on 2 plots), agent claimed legal division (sent documents with condominium declaration), neighborhood dispute (not ideal in a condominium under self-management)
- 1950s development house: severe moisture problems in the basement including mold, agent already had an offer for exterior waterproofing (franchise concept with suction lance) which was not expensive, basement height under 1.8m (5 feet 11 inches), so not usable
- 1950s development house: sold after only 2 years (hidden defects?), superficial renovation (cosmetic upgrades but original substructure)
- several other houses that left little impression (location, layout, quality, price not suitable)
Then, at the beginning of 2018, an offer came up that didn’t fully meet our criteria but was in the same neighborhood.
- built mid-1958
- very high-quality construction and workmanship for the time
- architect-designed house (engineer) for a medical professional (MD)
- hillside location, split-level, integrated garage
- district heating with concealed convectors
- well maintained, so renovation was minimal (bathroom tiled + ceramics, new roof 2002, new windows 1995)
- well-kept garden, granite paving
- 165m² (1,776 sq ft) living space + 40m² (430 sq ft) utility space
- 905m² (9,740 sq ft) leasehold plot at a dead-end street
- 493,000 €
The house was actually larger than we needed, but the structure and architecture were excellent. Renovations were manageable (utility lines easily accessible, partly in shafts), and the leasehold was acceptable because the owners had prepaid their installments (there was a discount), so the annual fee was only 500€ (~$540). The leaseholder is the city of Wolfsburg, which by statute only raises interest rates upon resale (not during the lease term or inheritance). When purchasing the plot, the land value is calculated by the benchmark land value minus the redemption amount and with a 15% discount. In mid-2017, the offer for the land was therefore 118,000€ (~$128,000) (with today’s benchmark land value it would be about 150,000€ (~$162,000)). This was a bargain for the area and was included in the asking price according to the agent.
Still, after a second viewing with experts (not appraisers), we found enough arguments (wall crack, renovation needs) to negotiate the price down to 420,000€. The public offer was then reduced to 435,000€ (~$470,000).
A financing broker secured approval from the local savings bank (Sparkasse) for the mortgage (leasehold is a bit special here, mostly local banks are familiar). It was feasible as a 20-year full repayment loan (leasehold agreement had to be valid for at least another 10 years), with a potential buffer to save up the land price.
But there was one issue: the over-90-year-old occupant. She was looking for an apartment in a senior residence (ground floor, lake view). Every week we heard it was only a matter of days until one would become available. In the end, by mid-April, we had a reservation with ownership transfer no later than December, possibly sooner. So we committed to financing and arranged the notary appointment...
...and then a week later, there was a request for a meeting (bypassing the notary). The niece and sister explained that the reservation was declared invalid. The time pressure was too great. It wasn’t certain the apartment would be available yet. They felt the elderly woman couldn’t be expected to move into a care home. They wanted a purchase contract with more time — about a year (implicitly without a strict limit).
We only had 6 months interest-free financing extension, but could imagine a few more months. However, only with financial compensation (1,500€/month rental cost difference). The counterproposal was to buy as planned but with ownership transfer only after the occupant moves out (essentially the right to live there). This was not acceptable (due to hardship rules; in the end you own the house but cannot evict the old resident). The only outcome was an informal understanding: we remained interested, please inform us when the senior residence is arranged; if we find something else in the meantime we will get back to you. The agent (VR-Bank) was not very pleased since it had been difficult to get the three women to agree before. It wasn’t her fault; the dossier was the best prepared with all necessary documents and missing items obtained promptly.
Two weeks later there was another interested party. Moral of the story: we successfully lowered the price for others but they moved in in October 2017.
Here are some floor plans of the property as inspiration for other house planners:
The agent mentioned that in the residential area, maybe one property sells every 1–2 years. The rest are sold privately. Since we moved in, three houses have been demolished and replaced by new builds twice the size. Another is still a shell and is receiving a huge extension. None of these properties were publicly marketed...
...the search continues in the next post and how we finally found our home.
R
Reudnitzer30 Nov 2019 22:13I have been following this for quite some time, but this is my first post, simply because your project is the first one that even comes close to being comparable to ours.
To explain: we have been living in a 150-year-old timber-framed house in Leipzig for twenty years, initially renting it, and ten years ago we were able to buy it.
After the purchase, it took us two years to really grasp that it was now ours. Since then, we have been renovating bit by bit, aiming to preserve as much as possible.
It seems to me that you are approaching this very methodically and sensibly. First removing the old junk in the basement and properly rebuilding it is a solid foundation for everything that comes later (we should have done that too). Like with an old garden, it’s also wise to first “experience” an old house (fortunately, we had enough time during the ten years of renting), instead of tearing everything out on instinct and possibly regretting it later (your laundry room floor is great, glad you kept it!)
Thank you very much for the detailed documentation—I look forward to seeing how it develops.
Best regards, Marie
To explain: we have been living in a 150-year-old timber-framed house in Leipzig for twenty years, initially renting it, and ten years ago we were able to buy it.
After the purchase, it took us two years to really grasp that it was now ours. Since then, we have been renovating bit by bit, aiming to preserve as much as possible.
It seems to me that you are approaching this very methodically and sensibly. First removing the old junk in the basement and properly rebuilding it is a solid foundation for everything that comes later (we should have done that too). Like with an old garden, it’s also wise to first “experience” an old house (fortunately, we had enough time during the ten years of renting), instead of tearing everything out on instinct and possibly regretting it later (your laundry room floor is great, glad you kept it!)
Thank you very much for the detailed documentation—I look forward to seeing how it develops.
Best regards, Marie
LordNibbler18 Dec 2019 14:10Winniefred schrieb:
What are your plans for the next few months? And congratulations on the pregnancy, that’s an exciting time, especially with the first child. I can only recommend getting as much done as possible before the baby arrives. Thank you very much, things will get serious in two to four weeks. So work will slow down for a while. We need to fill a dumpster again. There are two full big bags waiting in the garage for that, and then the rest of the old shower can be removed. In the garden, various stones and slabs have accumulated that need to be disposed of there as well.
The main project for the coming year will be the heating. That means dismantling the old radiators, closing the niches under the windows, laying the pipes, and doing all the installation work in the basement. The technical work there must and should only be done by a professional plumber (district heating compact unit with heat exchanger for heating and hot water, including the storage tank).
Also important is the small WC at the entrance. The soil pipe there is almost gone, and a large bundle of pipes (water, heating, sewage, electrical) has to run through this area.
Besides that, there are still plenty of small aesthetic tasks that take a lot of time. For example, oil-based paint in the hallway and basement stairs (plaster, paint, wallpaper?), the missing frame for the kitchen sliding door, and the garden. With the three of us working on it, we definitely won’t be bored.
Reudnitzer schrieb:
It seems like you are approaching this very carefully and sensibly. First, removing the old stuff in the basement and properly rebuilding it is a solid foundation for everything that comes later. We want to establish the foundation first before adding the nicer touches in some areas. It would be such a waste to have to remove things again because the substructure still needs to be replaced.
That’s why I’m already trying to gather ideas and inspiration for a conservatory replacement or extension this winter, so I don’t block off all options and always have a clear goal in mind.
LordNibbler13 Feb 2020 11:20The new year has started, and since early January, the three of us have been living in the house. Naturally, work on the house has slowed down for the time being.
The most important project in the basement is to replace the drainpipe leading to the guest toilet. Initially, this will only be done in the basement without having to open anything in the WC room.
The heating system will definitely not be replaced this year, but preliminary work is being done wherever possible. Instead, the priority will be the new home office, followed by the toilet below it.
The work must be carefully planned because the wiring for the upper floor and hallway already runs through these rooms.
At least the weather has allowed us to continue tidying up the garden. The hazelnut stump and compost remnants have now been removed. In spring, everything will need to be well aerated to encourage the grass to grow again in the garden.
The container issue has been resolved because there is a new addition to the equipment fleet that offers more flexibility at lower costs:
The most important project in the basement is to replace the drainpipe leading to the guest toilet. Initially, this will only be done in the basement without having to open anything in the WC room.
The heating system will definitely not be replaced this year, but preliminary work is being done wherever possible. Instead, the priority will be the new home office, followed by the toilet below it.
The work must be carefully planned because the wiring for the upper floor and hallway already runs through these rooms.
At least the weather has allowed us to continue tidying up the garden. The hazelnut stump and compost remnants have now been removed. In spring, everything will need to be well aerated to encourage the grass to grow again in the garden.
The container issue has been resolved because there is a new addition to the equipment fleet that offers more flexibility at lower costs:
Winniefred13 Feb 2020 15:37Congratulations on moving in! The trailer is great; we would love to have one like that too. Having a tipping function is really valuable.
What are your plans for the garden? It looks very tidy at the moment.
What are your plans for the garden? It looks very tidy at the moment.
LordNibbler13 Feb 2020 19:18Winniefred schrieb:
Congratulations on moving in!We have been living in the house since Easter 2019. Now a third resident has comfortably settled in and taken over the former office.
Winniefred schrieb:
The trailer is great, we would love to have one like that too. With a tipping function, that’s worth its weight in gold.Oh yes. I will have plenty of garden waste, need soil and gravel, and have construction debris to dispose of. I didn’t want to have to shovel all of that by hand.
Winniefred schrieb:
What’s the plan for the garden? It looks very bare at the moment.Definitely planning to plant two fruit trees. Not visible in the photo, a vegetable patch has already been prepared. And the new resident will surely be asking for a sandbox soon.
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