Financing your own home: Tips from an expert for young people. How Milena saved her start-up capital and dealt with banks.

Financing your own home: Tips from an expert for young people. How Milena saved her start-up capital and dealt with banks.

According to a report from www.shz.de, the days when almost everyone could finance a home are over. High inflation and rising interest rates do not make buying a property any easier. In order to assess whether you have a realistic chance of getting a loan, it is recommended to keep a household book. It is advisable to document income and expenses over several months to see which expenses can be reduced and how much can be saved each month. The more starting capital you have, the better conditions you get for the loan. The amount of interest can also affect how long it takes to pay off the loan.

According to the article, a young woman named Milena-Marie Brauer describes the search for a loan as “sobering and intimidating,” despite her frugal lifestyle and starting capital of 20,000 euros. The banks assumed that a woman in her mid-twenties would spend larger sums on clothing or soon be caring for children. Only with the help of an independent financial advisor was she able to obtain realistic financing. She got a loan of 150,000 euros with which she was able to buy a house for 80,000 euros at a foreclosure auction. The rest of the money is intended for renovation and costs such as property transfer tax.

Milena-Maria Brauer emphasizes how important it is for her to be financially independent. She has set up a standing order that transfers a set amount from her salary to a different account each month, so that she continually saves and only spends the amount that is still in the account. When renovating the house, she relies on used materials that she obtains from second-hand and second-hand shops or online platforms for second-hand goods. She corrects small blemishes herself, using her technical know-how.

Milena-Marie Brauer also looked for information and tips on the Internet. On YouTube, she found videos of other people who had also bought a home, and she found additional help in public forums. An important piece of advice was to only count on the money that you have for sure and that you need to have strong nerves.

The impact of these factors on the real estate market and industry could be that more people are looking to finance homes. However, rising interest rates and higher inflation are making this more difficult. Demand for loans could increase as banks have stricter lending criteria. This could result in a longer loan repayment period and potentially higher interest rates on the loans. People may also increasingly turn to used materials and cheaper options to reduce the costs of renovations and renovations.