ᐅ Renovation or New Construction? Buying a House with a Large Plot of Land!
Created on: 21 Feb 2025 23:53
F
Flo1990
Hello community,
We have the opportunity to quickly purchase a house (160 m2 (1,722 sq ft) living area, built in 1966, with 7 rooms) on a large plot of land (1,400 m2 (15,070 sq ft)). The structure is in good condition, solidly built, with a basement. We have basically already decided to buy it, as it’s a unique chance in our area!
However, there are several options for what we can do with the property:
Option 1:
Renovate the house and keep the plot. We would completely renovate it, including a new roof with an extension, heating, electrical system, plumbing, bathrooms, etc. Minimal personal work, just demolition and preparation.
Estimated costs from the architect: around €500,000 (about $550,000).
Option 2:
Cosmetically update the house so we can rent it out. Does anyone know if we would need to replace the oil heating system from 1990 and the oil tanks from 1966? What minimum costs should we expect for this?
Then build a new house on the large plot. Access to the new house past the existing building is not a problem. This has been approved by the local building authority (building permit/planning permission), and we are allowed to build a second house here.
Option 3:
Subdivide the plot, which has also been approved by the relevant building authority. Sell the existing house in its current condition along with a part of the plot. We would retain access to the new building and keep the plot for the new house.
We have an appointment soon with an independent mortgage advisor. We are mainly interested in which option banks are most likely to approve based on your experience. Do banks generally require more collateral and recommend selling the existing house when building new, or do they tend to support rental properties more?
Also, what is the current situation with renovation projects regarding bank financing? The renovation costs more than the property itself. Do banks even finance such projects? Or do they recommend building new instead for the renovation budget?
Thanks for your help!!
We have the opportunity to quickly purchase a house (160 m2 (1,722 sq ft) living area, built in 1966, with 7 rooms) on a large plot of land (1,400 m2 (15,070 sq ft)). The structure is in good condition, solidly built, with a basement. We have basically already decided to buy it, as it’s a unique chance in our area!
However, there are several options for what we can do with the property:
Option 1:
Renovate the house and keep the plot. We would completely renovate it, including a new roof with an extension, heating, electrical system, plumbing, bathrooms, etc. Minimal personal work, just demolition and preparation.
Estimated costs from the architect: around €500,000 (about $550,000).
Option 2:
Cosmetically update the house so we can rent it out. Does anyone know if we would need to replace the oil heating system from 1990 and the oil tanks from 1966? What minimum costs should we expect for this?
Then build a new house on the large plot. Access to the new house past the existing building is not a problem. This has been approved by the local building authority (building permit/planning permission), and we are allowed to build a second house here.
Option 3:
Subdivide the plot, which has also been approved by the relevant building authority. Sell the existing house in its current condition along with a part of the plot. We would retain access to the new building and keep the plot for the new house.
We have an appointment soon with an independent mortgage advisor. We are mainly interested in which option banks are most likely to approve based on your experience. Do banks generally require more collateral and recommend selling the existing house when building new, or do they tend to support rental properties more?
Also, what is the current situation with renovation projects regarding bank financing? The renovation costs more than the property itself. Do banks even finance such projects? Or do they recommend building new instead for the renovation budget?
Thanks for your help!!
It’s a pity that my comment
has not triggered any response (= slow realization). Without the slightest clue about the potential of the house and how the location of the surplus land relates to the existing house and access / development, it is unfortunately not possible to give advice more precise than "42." Almost all details are simply missing.
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
11ant schrieb:
I wear glasses and have a problem with invisible photos.
has not triggered any response (= slow realization). Without the slightest clue about the potential of the house and how the location of the surplus land relates to the existing house and access / development, it is unfortunately not possible to give advice more precise than "42." Almost all details are simply missing.
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
W
wiltshire25 Feb 2025 21:06Flo1990 schrieb:
What do you need to know about bridging loans? Is it usually straightforward to secure a regular loan afterward (for renovation or new construction)? There is generally no inherent issue preventing this.