ᐅ Stay here (and build) or move away (and build/buy elsewhere)
Created on: 21 Mar 2022 01:47
H
Hitokiri-1978
Hello everyone,
I don’t even know where to begin. There is an older thread, but since links are considered taboo, you’ll have to search for it yourselves if you’re interested. In short, since 2018!!! we have been aware of two new residential development areas in our town, with plots allocated based on a scoring system. And as it stands, we are currently ranked 52-55 (four others have the same score and would then be drawn by lot on the allocation day) out of a maximum of 59. I don’t want to blame the municipality here for leaving four years to pass without reason, ignoring two official land value assessments amid an exploding price level, and so on. Then came Corona, now “Crazy Ivan,” no more KfW funding, skyrocketing construction costs for prefab houses, rising interest rates, and generally increasing prices. In short… it’s totally insane to build now! But... who says it won’t be even worse in three years?
Additionally, we simply want to move to a bigger place (second child), and rental apartments in the Munich suburbs are outrageously expensive. For retirement, we want to have a certain amount of value as assets.
In general, about €30,000 (approximately $32,000) would come as a gift from our families, about €60,000 (around $64,000) as an interest-free loan from various wealthy Swiss relatives, and €10,000 (around $10,700) from us as equity. We already have a financial advisor who calculated everything, and a mortgage would be possible with a monthly payment of €1,770 (around $1,880). Everything would be tight, though: gym membership canceled, no spontaneous dining out, no spontaneous activities... best if I cook lunch at home.
So… soon (unless someone files another lawsuit) the plots will be allocated. By then, we need to decide if we want to stay here in the familiar neighborhood (with all its advantages, like close proximity to the in-laws) and manage the estimated €750,000 to €850,000 (about $800,000 to $900,000)—€350,000 ($375,000) for the land and the rest for the house—without getting overwhelmed. (Net income is about €4,400 ($4,670), with €2,700 ($2,865) fixed expenses and living costs.) Alternatively, we have considered moving away from Bavaria. The Upper Franconian provinces near the Czech border are significantly cheaper for used properties, ranging roughly from €200,000 to €500,000 ($215,000 to $530,000), and we would have a lot more room and money for living there.
We have already crossed out the plots that are definitely not an option for us. Oh, and half of them are for sale, the others are assigned as leases with all their possibilities but also many problems!
It’s a painful, nagging question whether it’s better to stay here and hope for an increase in value (plus living close to the parents), make use of leasehold rights and slowly lose value, or move somewhere else entirely where prices are reportedly much lower according to Immo24. Also, my wife is assuming the current situation will continue, while I am hoping to finally get a better paying job within the next one to two years.
Clearly, we don’t want to leave, but the price level is just so insane that we have to ask ourselves if it’s really worth it anymore. This whole situation just causes headaches, with the feeling that we have to choose between bad and worse.
I don’t even know where to begin. There is an older thread, but since links are considered taboo, you’ll have to search for it yourselves if you’re interested. In short, since 2018!!! we have been aware of two new residential development areas in our town, with plots allocated based on a scoring system. And as it stands, we are currently ranked 52-55 (four others have the same score and would then be drawn by lot on the allocation day) out of a maximum of 59. I don’t want to blame the municipality here for leaving four years to pass without reason, ignoring two official land value assessments amid an exploding price level, and so on. Then came Corona, now “Crazy Ivan,” no more KfW funding, skyrocketing construction costs for prefab houses, rising interest rates, and generally increasing prices. In short… it’s totally insane to build now! But... who says it won’t be even worse in three years?
Additionally, we simply want to move to a bigger place (second child), and rental apartments in the Munich suburbs are outrageously expensive. For retirement, we want to have a certain amount of value as assets.
In general, about €30,000 (approximately $32,000) would come as a gift from our families, about €60,000 (around $64,000) as an interest-free loan from various wealthy Swiss relatives, and €10,000 (around $10,700) from us as equity. We already have a financial advisor who calculated everything, and a mortgage would be possible with a monthly payment of €1,770 (around $1,880). Everything would be tight, though: gym membership canceled, no spontaneous dining out, no spontaneous activities... best if I cook lunch at home.
So… soon (unless someone files another lawsuit) the plots will be allocated. By then, we need to decide if we want to stay here in the familiar neighborhood (with all its advantages, like close proximity to the in-laws) and manage the estimated €750,000 to €850,000 (about $800,000 to $900,000)—€350,000 ($375,000) for the land and the rest for the house—without getting overwhelmed. (Net income is about €4,400 ($4,670), with €2,700 ($2,865) fixed expenses and living costs.) Alternatively, we have considered moving away from Bavaria. The Upper Franconian provinces near the Czech border are significantly cheaper for used properties, ranging roughly from €200,000 to €500,000 ($215,000 to $530,000), and we would have a lot more room and money for living there.
We have already crossed out the plots that are definitely not an option for us. Oh, and half of them are for sale, the others are assigned as leases with all their possibilities but also many problems!
It’s a painful, nagging question whether it’s better to stay here and hope for an increase in value (plus living close to the parents), make use of leasehold rights and slowly lose value, or move somewhere else entirely where prices are reportedly much lower according to Immo24. Also, my wife is assuming the current situation will continue, while I am hoping to finally get a better paying job within the next one to two years.
Clearly, we don’t want to leave, but the price level is just so insane that we have to ask ourselves if it’s really worth it anymore. This whole situation just causes headaches, with the feeling that we have to choose between bad and worse.
B
bavariandream21 Mar 2022 23:26If it’s at all possible for work and your landlord might even agree to subletting, I would first try moving somewhere else temporarily and live there as a renter. Until early 2021, we lived in southern Bavaria and always felt completely comfortable there. For family reasons, we then moved to East Frisia for a few months, and although we actually liked it there and the prices were very affordable, it just didn’t feel like home. We then looked for a rental apartment near our old home region again because the purchase prices were simply astronomical. We were incredibly lucky to recently receive a message out of the blue from a municipality where we had been asking about land since 2018 but kept getting rejected, telling us that we can now buy our absolute dream plot. Fortunately, my parents are supporting us financially, but we will still have to make many compromises (the land itself costs less than half of comparable plots on the open market, but due to the sharply increased construction costs, the monthly installments will still exceed our comfort limit). However, we have realized that we simply feel most at home here and are willing to make compromises in other areas for a life in this municipality.
Of course, that doesn’t mean you couldn’t be happy somewhere else (I wasn’t born here myself), but we have now consciously decided to take a big financial risk and live exactly where we feel at home. But as I said, everyone has to figure that out for themselves. Maybe, as I mentioned at the beginning, you could temporarily move somewhere else, because that really made us realize that we want to live in southern Bavaria at all costs. If the opportunity with the municipal land hadn’t come up, we would have accepted renting forever.
Here in this area, even in smaller towns it’s very difficult to find suitable rental apartments if you, like us, have two children and pets. At the end of last year, we viewed a semi-detached house for rent located in a tiny village right on the main road, and it was still supposed to cost nearly 2,000 euros per month. According to the real estate agent, it had almost 200 interested parties within a very short time, and the landlord actually preferred an older couple without children. And if you have pets, you’re usually automatically out of the running.
Sorry for the long post, but to summarize once again: It’s best to first move temporarily somewhere else and then decide whether, like us, you want to live here at all costs or prefer to fulfill your dream of owning a home somewhere else.
Of course, that doesn’t mean you couldn’t be happy somewhere else (I wasn’t born here myself), but we have now consciously decided to take a big financial risk and live exactly where we feel at home. But as I said, everyone has to figure that out for themselves. Maybe, as I mentioned at the beginning, you could temporarily move somewhere else, because that really made us realize that we want to live in southern Bavaria at all costs. If the opportunity with the municipal land hadn’t come up, we would have accepted renting forever.
Here in this area, even in smaller towns it’s very difficult to find suitable rental apartments if you, like us, have two children and pets. At the end of last year, we viewed a semi-detached house for rent located in a tiny village right on the main road, and it was still supposed to cost nearly 2,000 euros per month. According to the real estate agent, it had almost 200 interested parties within a very short time, and the landlord actually preferred an older couple without children. And if you have pets, you’re usually automatically out of the running.
Sorry for the long post, but to summarize once again: It’s best to first move temporarily somewhere else and then decide whether, like us, you want to live here at all costs or prefer to fulfill your dream of owning a home somewhere else.
@bavariandream, I’m sure you mean well, but he simply can’t afford it in his hometown. The opportunity has passed. He might even get a plot of land from the municipality, but he can’t build a house on it. Maybe you haven’t read the other threads about this. 🙂 Some of the plots are leasehold, which he also rejects, even though they might be somewhat more affordable (whether that would be enough, I don’t know either).
They have known about the building area for at least four years and have only managed to save $10,000 (about 10,000 euros). That is practically nothing, unfortunately. Honestly, I can’t imagine a bank would finance his house in that location.
There was also talk of a job change in one of the recent threads, but nothing seems to have happened. We keep reading about how terrible everything is, but little about how he is actively addressing the situation or seriously considering alternatives. The focus is only on this one building area, which naturally leads to frustration. Sometimes, letting go and moving on is better for one’s happiness.
They have known about the building area for at least four years and have only managed to save $10,000 (about 10,000 euros). That is practically nothing, unfortunately. Honestly, I can’t imagine a bank would finance his house in that location.
There was also talk of a job change in one of the recent threads, but nothing seems to have happened. We keep reading about how terrible everything is, but little about how he is actively addressing the situation or seriously considering alternatives. The focus is only on this one building area, which naturally leads to frustration. Sometimes, letting go and moving on is better for one’s happiness.
P
Pinkiponk22 Mar 2022 07:48Hitokiri-1978 schrieb:
...I agree that the situation is tight, but I wouldn’t call your plan impossible – your goal is too worthwhile for that. It’s probably wiser to listen to the other forum members. Would a shell home combined with a land lease be an option for you? Although that likely involves a lot of stress and work, which in the end could even affect your relationship.However, if you believe that your only options are between “bad and really bad,” then in my view, the decision is clear. Without an essential “must” in life, there is no need to settle for something bad or really bad. And building or buying a house is not an essential “must.”
I still clearly remember the other thread… thanks for the link @WilderSueden … if that’s the right one… the leasehold issue sounds familiar…
This is one of those complaint threads just like that one. People tend to forget: where it’s cheaper, the better-paying jobs are not available – quite the opposite. If you grow up there, you can get used to the situation. But the idea of finding a home there because it’s more affordable and you supposedly earn more does not work.
Did I understand correctly that having a second child means you have to be unhappy if you don’t own a house and garden?
This is one of those complaint threads just like that one. People tend to forget: where it’s cheaper, the better-paying jobs are not available – quite the opposite. If you grow up there, you can get used to the situation. But the idea of finding a home there because it’s more affordable and you supposedly earn more does not work.
Did I understand correctly that having a second child means you have to be unhappy if you don’t own a house and garden?
Pinkiponk schrieb:
I wouldn’t call your plan impossible; I actually find your desire very admirable.What kind of "argument" is that? Please be aware that people like the original poster are seeking validation for their plans here—which, in this case, is understandable (about a $800k loan with a $4.4k income!!!!!)—and not receiving it might actually save them from a major mistake or disaster. When someone like you casually throws out such an unsupported statement without context, it risks encouraging the original poster to latch onto it and ignore other important warnings, which can be dangerous.
Your reasoning, "I wouldn’t call your plan impossible; I actually find your desire very admirable," is, sorry, just crazy.
B
bavariandream22 Mar 2022 22:42Ysop*** schrieb:
@bavariandream, you probably mean well, but he simply can’t afford it in his hometown. The opportunity has passed. He might even get a plot from the municipality, but he can’t build a house on it. Maybe you haven’t read the other threads about this. 🙂 Some plots are leasehold, which he also rejects, even though they might be somewhat more affordable (whether that would be enough, I don’t know either).
They have known about the development area for at least four years and have only managed to save 10,000 in equity? That is practically nothing, unfortunately. Honestly, I can’t imagine a bank financing his house in that location. There was also talk about a job change in one of the recent threads, but nothing seems to be happening. We always just read how terrible everything is, but little about how he is actively addressing the situation or seriously considering alternatives. Focusing only on this one development area is bound to cause frustration. Sometimes it’s better for your happiness to move on and let go.I haven’t actually read the other thread, but I can already tell here that it’s probably unaffordable for the original poster. However, my intention with my comment was to suggest that he might first need to decide whether he could be happy somewhere else. I would personally consider renting an apartment in the Upper Franconian countryside (or wherever), because if it doesn’t work out, at least the realization won’t have been too costly.Similar topics