The dream of owning your own home: According to the banks, you should bring at least 20 to 30 percent equity with you. Mascot via Getty Images
Residential property prices are currently falling. Will this make the dream of owning your own home more affordable again?
We have calculated for you how much money you need to save to buy an apartment or a house.
According to our sample calculation, you need an average of 56,000 euros of equity for an apartment; for a house it is 90,000 euros.
Condominiums and single-family homes are cheaper again. The Federal Statistical Office (Destatis) according to the prices for residential real estate in the first quarter of 2023 fell the most in 23 years. This makes many people wonder whether their dream of owning their own home could still work out.
We have calculated for you how much you currently have to save to buy a property.
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Example calculation: How expensive is an average apartment?
According to the, you pay for a condominium in Germany Real estate portal Immowelt currently 3268 euros per square meter. Like the microcensus of You are ready for 2022, an average rental apartment in Germany is 74.6 square meters. For a condominium of this size you have to pay around 244,000 euros on average.
But that’s not all. Because there are also the so-called additional purchase costs, which you have to take into account. These include, among other things, the notary costs, the real estate transfer tax and the brokerage commission, which are usually incurred when buying a property.
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Depending on the region and the type of property, the ancillary costs vary. According to the savings bank but you can count on twelve to 15 percent of the purchase price. If we assume the maximum of 15 percent, this means: In addition to the purchase price of 244,000 euros, there are around 37,000 euros in additional costs. The total price for an average-sized property is therefore around 281,000 euros.
How much equity do you need to buy a home?
You can finance part of the total price. If you want to buy a property, you usually need equity capital. The principle applies: the more, the better. Because if you can pay a larger part of the purchase price with your own funds, you need a smaller loan for financing.
Banks state that their usually at least 20 percent of the total costs should be covered by own capital. So that you can afford an apartment for 281,000 euros, you should currently save at least 56,000 euros.
Sample calculation: This is how much money you have to save for a house
For an average house, you have to dig a little deeper into your pocket, as they are usually larger. You pay per square meter according to that Real estate portal Immowelt currently 2899 euros. With a house size of 135 square meters, the average purchase price is around 391,000 euros.
If we assume ancillary costs of 15 percent of the purchase price, as in the previous sample calculation, around 59,000 euros will be added to the purchase price. Overall, a 135 square meter house costs around 450,000 euros on average. With 20 percent equity, this means that you should save at least 90,000 euros.
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Equity also includes shares and other real estate
That’s a lot of money, but there’s good news. Your equity doesn’t just include your savings on the account. It can also consist of your cash assets, shares or other real estate, for example.
Nevertheless, one thing is certain: the dream of owning your own home will remain expensive for the time being. Because the prices for single-family houses and condominiums were nationwide between 2010 and 2021 by around 84 percent gone up. In addition, interest rates on loans and construction have skyrocketed in the past year.