ᐅ We are planning to build in 2022; the planning phase is beginning.
Created on: 6 Jun 2020 09:33
Y
Ybias78
Before I share the completed data, here are some details about our building project. We are still quite early in the process. About 2.5 years ago, we purchased a plot of land that we are currently paying off. The plot is located within the developed area of Fichtenwalde (about 50km (31 miles) south of Berlin) and is currently classified as forest. There are about 80 trees on the land. Converting it into a building plot is not a problem. However, there is a tree protection regulation, which means all trees must be replaced. The cost of felling the trees, including replanting and a financial deposit (in case the replacement trees do not survive), is around €20,000 (based on feedback from our neighbors who built last year).
We plan to start building the house at the beginning of 2022 and want to consult an architect by August 2020 to design the house and submit the building permit / planning permission application. While the building application is being processed, the land can then be converted, including tree removal. This will be paid for with the money we save from now until the new build. We don’t have any other equity. We moved in together around 10 years ago, during which time we had to pay off my student loans, buy two cars, etc. Our income has also increased over time.
We now need some help with the overall planning. As mentioned, our current plan is:
Here is the plot:
Information about us:
General information about you:
Expenses already included elsewhere can be omitted. This list is not exhaustive and can be extended or summarized. Please specify all costs monthly, even if they only occur annually!
Housing costs:
Other expenses:
General information about the property:
We plan to start building the house at the beginning of 2022 and want to consult an architect by August 2020 to design the house and submit the building permit / planning permission application. While the building application is being processed, the land can then be converted, including tree removal. This will be paid for with the money we save from now until the new build. We don’t have any other equity. We moved in together around 10 years ago, during which time we had to pay off my student loans, buy two cars, etc. Our income has also increased over time.
We now need some help with the overall planning. As mentioned, our current plan is:
- Consult an architect and plan the house by August.
- Submit the building permit / planning permission application in October.
- Tree felling can take place by the end of February.
- In 2021, we will look for a (most likely) regional company to build the house (recommendations welcome).
- From June 2020 to December 2021, the saved money will be spent on:
- Architect fees, tree removal, paying off the land including a €2,750 special repayment. A new car for my wife (approx. €10,000) will also be purchased.
- Cheaper items should also be covered, such as surveying, soil report, etc.
Here is the plot:
Information about us:
General information about you:
- Who are you?
- A family of three.
- How old are you?
- She is 38, he is 41, daughter: 8.
- Do you have children?
- Yes, a girl.
- Are more children planned?
- No others planned.
- What do you do professionally?
- She is a full-time teacher. He is a controlling manager for several hospitals (full-time).
- Are you employed, self-employed, retired, homemaker, etc.?
- Both employed.
- How many hours do you work?
- She works full-time with 27 teaching hours plus preparation and follow-up time. He works 40 hours.
- What are your gross/net incomes?
- She: €2,820. He: €3,000 (tax class IV/IV). This includes about €400 in company pension contributions. Additionally, there are annual bonuses of about €3,000 (not included in net income).
- How much child benefit do you receive?
- €204.
- Other transfer payments like parental allowance, sick pay, etc.?
- None.
- How much equity do you have?
- Currently negligible (under €10,000).
- How much of that equity do you want to invest in the house project?
- All of it.
Expenses already included elsewhere can be omitted. This list is not exhaustive and can be extended or summarized. Please specify all costs monthly, even if they only occur annually!
Housing costs:
- Current basic rent (cold rent)
- €390
- Current total rent (warm rent)
- €567
- Electricity
- €72
- Gas
- None.
- Water, sewage, waste disposal, street cleaning
- Included in additional costs.
- Telephone, internet, mobile phone
- €85 (including Amazon Prime and Netflix)
- Public transport monthly pass (also for children)
- None.
- Car loan (or savings rate for a new car)
- Currently none.
- Insurance
- €100 per month (one fully comprehensive, one partially comprehensive).
- Taxes
- €34
- Fuel
- €200
- Repairs
- €140
- Other
- Is there a second car, motorcycle, scooter? Please specify all costs again!
- Private health insurance (also supplementary health insurance, daily sickness allowance, etc.)
- Dental supplementary insurance: €37
- Liability insurance (including pets)
- €7
- Capital or term life insurance
- None
- Pension insurance (including company pension plans)
- Company pension contributions (already included in net income).
- Disability insurance
- None
- Accident insurance
- None
- Household contents insurance
- €7
- Legal expenses insurance
- €20
- Other insurance (e.g., travel insurance, funeral insurance)
- Groceries
- Difficult to plan.
- Dining out
- Personal care/drugstore
- Pets (food, vet, medication, housing)
- Medication
- Clothing
- Furniture
- Childcare/school fees (including meals)
- After-school care €190 including meals
- Tutoring
- School supplies and books
- Club fees/gym
- Student association: €20
- Gym: €25
- Daughter’s music school: €66
- Babysitter
- Toys
- Cleaning
- TV/video/audio/CDs/DVDs
- Tickets (sports, cinema, concerts, etc.)
- Donations
- Student association: €15
- Other
- Vacation
- House
- Retirement
- Hobbies/gifts
- Other
- Total: €2,250
Other expenses:
- Alimony?
- Loans?
- €250 for the land.
- Other?
- Anything forgotten? Please add here!
- Total income: €6,024
- Total expenses: €3,769
- Balance: €2,255 (saved).
- Including cold rent and optional savings (e.g., savings rate for the house).
General information about the property:
- How large is the plot?
- 1,447 sqm (15,575 sq ft)
- What are its dimensions?
- 20 m (66 ft) road frontage x 72 m (236 ft)
- What is the land value?
- €120 per sqm
- New build, renovation / year built, house type?
- New build – L-shaped bungalow (we are still very early in planning)
- Garages?
- Depends on the budget.
- How big should the house be? (living area / usable area)
- About 140 sqm (1,507 sq ft)
- What is the market value of the land and house after completion?
- Land approx. €200,000 + house €350,000 = €550,000
- Land cost:
- Current outstanding debt €42,000
- Development costs
- Plot is fully developed.
- Acquisition incidental costs (notary, court, property transfer tax, realtor)
- Building or purchase costs (including architect, structural engineer):
- €300,000 budgeted.
- Renovation or restoration costs
- Additional building costs (e.g., utility connections, soil expert, construction electricity, etc.)
- Planned: €50,000
- Outdoor facilities/terrace, paths, landscaping, fences, etc.
- Depends on the total costs.
- Financing costs (fees or commitment interest)
- Total costs
- Remaining debt on the land + new build: Planned financing amount: €400,000
- Kitchen costs
- €10,000
- Furniture, lamps, decoration
- Mostly furniture will be kept and replaced gradually.
- Other "non-acquisition, incidental acquisition, construction, or additional building costs"
- Total costs:
- €400,000
- Deductible equity
- €0 (will be used for clearing the plot; €25,000).
- Financing amount
- €400,000
Nida35a schrieb:
The bank wanted us to use our own equity first and then take out the loan. We agreed on €70,000 (about $75,000) in equity first, then the loan, and finally the remaining equity. Your costs are these equity amounts, but they can be negotiated.The costs of around €20,000 (about $22,000) are planned to go towards the kitchen and possibly other unexpected expenses.
dynaudio7922 Sep 2020 20:16Ybias78 schrieb:
Had an appointment with the general contractor today. He was very unprepared. I'm currently working on my nonexistent patience.
But in the end, it went well. He said that if everything goes as planned, the building permit application should be expected around the end of October. The official site plan is not ready yet. Also, I will first sign a planning contract with him, where 5% of the total amount must be paid (this is included in the price and will then be deducted from the construction contract). 50% is due upon submission of the building permit application. The remaining 50% after 5–6 weeks.
One question regarding financing. I would like to arrange this only at the end of the year due to commitment fees. Can I already submit and get reimbursed for payments such as:
- Surveyor
- Soil report
- Planning contract
? Yes, invoices that have already been paid from your own equity in advance and are listed in the financing calculation can be reimbursed to you by the bank. However, it depends on how your additional construction costs (building-related ancillary costs) are composed or will be composed.
Since everything is still open in your case, you can either include these costs in the additional construction costs or declare them as equity since they have already been paid.
In my case, I will get the funds reimbursed. So, I will submit the invoices and have the amounts transferred to my account.
Currently, plan for 3 to 4 months for the building permit process.
Ybias78 schrieb:
Also, I will first sign a planning contract with him, where 5% of the total amount must be paid (but this is included in the price and will be deducted from the construction contract). 50% is due upon submission of the building permit / planning permission application. The remaining 50% is due after 5–6 weeks. 5% for the entire planning process seems reasonable and fair. After all, you could still take your plans elsewhere after the building permit / planning permission is submitted.
I find the rest of the payment schedule quite steep and rather risky. I would definitely try to renegotiate! Alternatively, at least ask for a bank guarantee from the general contractor’s bank.
Ybias78 schrieb:
A question about the financing. I would prefer to arrange it at the end of the year because of the commitment interest charges. Can I submit and get reimbursed for amounts already paid, such as:
- Surveyor
- Soil report
- Planning contract As mentioned here, this is indeed something to negotiate.
Our bank wants to see proof of equity before the contract is signed. However, I agreed with them that the equity will be provided only after the debt financing is in place.
DaSch17 schrieb:
I think 5% for the entire planning phase is reasonable and fair. After all, you could still take those documents elsewhere after submitting the building permit / planning permission application.
I find the rest of the payment schedule quite steep and rather risky. I would definitely try to renegotiate! Alternatively, at least secure a guarantee from the general contractor’s (GC) bank.
As mentioned here before, this is really a matter for negotiation.
Our bank wants to see proof of equity before finalizing the contract. However, I agreed with them that the equity would only be contributed after the debt financing is arranged. What other payment schedule? The 50% includes the 5%/2 installments, meaning it is paid in two parts. There is also a 1% discount.
The payment plan in the construction contract consists of 13 installments.
Ybias78 schrieb:
What remaining payment schedule? The 50% represents the 5%/2. So, it is paid in two installments. Additionally, there is a 1% discount.
The payment schedule in the construction contract consists of 13 payments. Sorry. I misunderstood. I thought the progress payments were split into two large installments... oops:
Then everything is fine.