Buying an apartment or a house?

[SirGeorge]

Hello everyone,

I am having some thoughts on what my next step for housing should be. I am renting an 1-bed apartment for 370 euros for the past 6 years and would like to go to the next step.

I have available a 750 square meter plot that I can build a 250 square meter house on but it will cost me around 300,000+ euros to build. I can put a downpayment of 50,000 euros and get a loan of 250,000 for 35 years at around 900 eur monthly payment (paying 125,000 euros as interest in the meantime!).

Or I could buy a 2 bed apartment for around 135,000eur. Put a downpayment of 50,000 euros and get a loan of 85,000 with a monthly repayment of 900 euros which I can pay back in 9 years.

In 9 years after paying the loan, I will start building the house but I will rent out the 2-bed apartment for 650-700 eur per month and use that money for my house loan repayment. How does that sound?

I am 30 years old and probably getting married in the next 2-3 years as well. All of the above can be done either contributing only myself of can be split with my partner.

 

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[daniel_m]

It depends. If you are fine living in an apartment, I'd rather just rent an apartment and pay <500 euros per month indefinitely, and use my cash reserves to make more money.

If you HAVE to buy something, I would personally get the house because I find that living in a house is way better than living in an apartment. Where you live is one of the most important things in your life so I think it's somewhat okay to take on debt for that.

300K seems like a lot to build a house in Europe though.

 

[MJ DeMarco]

No real right answer, depends on what you envision for yourself and your family years from now.

Answer is dependent on: 1) Family and its growth 2) Desire to travel 3) What partner wants 4) Economic forecasts, both yours and your country.

In 9 years after paying the loan, I will start building the house but I will rent out the 2-bed apartment for 650-700 eur per month and use that money for my house loan repayment. How does that sound?

Why 9 years and not earlier?

 

[James Klymus]

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I know you arent in the states, but maybe this is something you could do in your country.

 

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[biophase]

Why are you thinking of building the house? How much does the house rent for?