The Zimmermann family: Ownership impossible

By Philipp Krohn (text) and NIKLAS GRAPATIN (photos)

May 19, 2023 · When Sigrid and Rolf Zimmermann built their house half a century ago, a lot of muscle power was needed. For her son Carsten, it went with equity and a little skill. The grandchildren Finn and Joschka, on the other hand, will have a very hard time.

Father and son Zimmermann each built their first house not far from each other. From the driveway of the family headquarters, you pass the other single-family houses with their well-stocked gardens, along a green strip where dog owners walk their four-legged friends and joggers go for a spin. Then the former house of Carsten Zimmermann can be recognized: converted attic, solar panels on the roof, two floors of red clinker, as is customary in the Lüneburg Heath. Built in 1993 – a good quarter of a century after the house of his parents Rolf and Sigrid.

Whether these two houses will be followed by those of the grandsons Finn and Joschka is written in the stars. Twenty-six are the two twin sons of Carsten and grandson of Rolf Zimmermann. "I don't know anyone in my circle of friends who wants to build," says Joschka. It remains to be seen whether not wanting to do so also resonates with a bit of inability. At his age, grandfather Rolf had already rolled up his sleeves for two years and had almost completed his first home on his own with friends.

The Zimmermann family: Sigrid and Rolf (center), next to the twins Joschka (left) and Finn as well as their father Carsten and his wife Gaby Fuchs

He had already married, his son Carsten was four years old at the time. Rolf's grandchildren, in their mid-twenties, are far from starting a family. One of them, Joschka, has trained in public administration and works for the city of Osnabrück. It is unlikely that he will build a house in his grandparents' area. He lives for rent in an apartment in the middle of the city. For him, it fits. But: Something is different today than with grandfather and father.

Rolf and his wife Sigrid built on peat land in 1969, later added an extension and rented out both floors of the original house. To this day, they live in cultivation. At the beginning of the nineties, her son Carsten dared to tackle the first of a total of four construction projects – the house with the solar panels just around the corner. For various reasons, he has since built three more homes – always within a close radius of Bardowick, which is located on the northern city limits of Lüneburg.

"I would like to have my own home at some point. The desire is there, but also a realism."

JOSCHKA ZIMMERMANN, grandson

Even if Joschka and his brother Finn, who is in a similar situation to him, wanted to, they could hardly afford to own their own home. It would eat up an unsustainable share of their income. At best, if partners were added who would take on financial burdens and grandparents and parents would contribute something to the equity, the wish could be fulfilled. "I would like to have my own home at some point," says grandson Joschka. "The desire is there, but also a realism."

On this Thursday there will be quark cake and filter coffee at the Zimmermann grandparents' house. The three generations are grouped around the large dining table in the living room. In the center the fireplace, blue tablecloth, dark blue wooden beams support the wall. "I didn't always have three-striped shoes," recalls Carsten, fifty-five, with a mighty full beard and a twirled moustache. "But there was always coffee and cake here." The friends went in and out; it was an open house. His current wife Gaby Fuchs, whom he married after the divorce from Joschka and Finn's mother, draws Rolf's father-in-law's attention to a new offer of money that is currently lighting up on her smartwatch: three percent fixed-term deposits. Like Carsten Zimmermann, who worked at a bank, Gaby is also a specialist.

When the family eats the quark cake, it is about real estate financing over three generations. That's how it was agreed beforehand. After leaving the bank, Carsten Zimmermann started his own business in the property development business and later founded an association with a friend, which is called the Federal Association of Construction Financing, but is less of a lobby association than a consumer organization. That's why he knows his way around and suspects that his family history can contribute to questions that are currently occupying many people: Can you still afford a house today? Weren't privations necessary in the past to build one's own four walls? Or: Have a decade and a half of low to negative interest rates robbed us of the feeling of a healthy burden?

The real estate history of the Zimmermanns begins at the end of the sixties without equity here in Bardowick, just a few meters from the fireplace in today's living room in the annex. Sigrid gave birth to her first of two children, Carsten, in 1967. The family lives with their parents for forty marks a month. But Rolf thinks that it can be uncomfortable in old age without a home. You can find a plot of land in the duck moor for ten marks per square metre. Today's property values are about fifty times as high.

"You wouldn't believe how many carts I pushed back then."

SIGRID ZIMMERMANN, Grandma

At that time, Rolf had already earned 2000,<> marks a month as a heating engineer, but in the first economic crisis of the Federal Republic of Germany he had to join the Bundeswehr, his salary fell to a third. There, however, he had many comrades who could lend a hand. In addition, the football friends in the Lüneburger SK. One had an excavator, which he provided for construction. "The ground was so wobbly. There was more and more peat towards the property boundary," recalls Rolf Zimmermann. Free of charge, friends provided knowledge, hours and muscle power. As a reward, there was stew and beer. Neighbourhood help filled a gap left by a lack of equity in the financial plan. "You wouldn't believe how many carts I pushed back then," Grandma Sigrid says to her two grandchildren.

Rolf has documented everything in an old folder: the financing via a "until further notice" loan, the family loan from a bank. A total of 78,100 marks are available to them, and the friends' own help is valued at 30,000 marks. Of this, the property of 8350 marks and bills of 72,500 marks have to be paid. 2000 marks for a veneer, they do without expensive clinker brick and plaster the façade, 1000 marks cost the drinks for the topping-out ceremony.

The family's real estate saga began with the construction of a house on peat soil in Bardowick. Today, Rolf and Sigrid live in an annex.

The feast must have been lavish. But no one had a free hand to take pictures. Carsten Zimmermann's uncle Fiete takes up a good part of the cost of drinks, lies down in the cot while intoxicated, falls asleep and doesn't notice how cold it is in the new building. The next morning, he complains hungover that no one has covered him. Memories for the family chronicle.

Carsten Zimmermann feels it is a great benefit that his parents now have a house. He and his father were hobbyists, and later became enthusiastic about classic cars. His family frowns that the most important thing about his four construction projects was the garage. His mother, Sigrid, worked in a newsstand for twenty years for little money. Things are going better for her husband Rolf after his early retirement due to the unit. As a heating engineer, he can support modernization in the new federal states. In 1996, the family headquarters was paid off.

"For generations, building houses has been accompanied by a considerable reduction in consumption."

CHRISTIAN PFNÜR, Real Estate Economist

The model of the grandparents' generation is not atypical for West Germany. "For generations, building houses has been accompanied by a considerable reduction in consumption," says real estate economist Christian Pfnür of the Technical University of Darmstadt. Without the "muscle mortgage" that was common at the time, it would have been impossible for this generation of owners to build their own home. For this article, Pfnür has compared the rough key data of the financing of Rolf and Carsten Zimmermann and a potential one of the twins Finn and Joschka. More than a rough estimate cannot come out of it. However, it allows statements tailored to this case about how the real estate business has changed over half a century. Where figures on interest rates were lacking, for example, Pfnür made realistic assumptions.

Rolf Zimmermann

In each case, the economist has set the costs in relation to net income. About seven percent of his annual net earnings at that time amounted to the construction costs of the first house, the acquisition and production costs ten percent. Debt servicing accounted for two-thirds of net salary. When Rolf's son Carsten built his first of four houses a quarter of a century later, the fixed costs were already higher. Ten percent the construction costs, thirteen percent the acquisition costs. In return, Carsten had to pay a noticeably lower debt service with fifty-seven percent.

This was due to a consideration that the trained banker had made: After his parents had almost paid off their house, he saw himself in a position to finance at the age of twenty-seven. He was able to borrow 100,000 marks from his parents as equity. Together with his future wife, he built two residential units. They wanted to move into one themselves, and from the other they generated rental income, half of which covered the loan installment. When their twins were born, they had exercise in their own garden. His colleagues in Hamburg, where he worked, envied him because something like this would not have been affordable in the big city. He built the later houses with the proceeds from the sale of the previous one.

At 113 marks per square metre, the price of land at that time was more than ten times as high as in his father's time. "At the end of the sixties, a lot of space was still vacant, but it was gradually built on," says real estate economist Pfnür. "Today's land prices have to do with scarcity." In the real estate market, the usual thing has happened when supply is finite and demand increases: prices are rising.

"I didn't know anything other than growing up in a house," says Joschka. When he and his brother were eight years old, their parents separated. On the weekends, the two of them learned that real estate also has to do with deprivation. In the meantime, father Carsten had become self-employed and also had to work on Saturdays. "At forty-eight, forty-nine, I could already say that I don't have to do everything professionally anymore," he says. "The negative side: my marriage failed, I had much less time for the children."

What predominates from the point of view of his two sons is not certain. However, they certainly felt the professional pressure associated with their father's financing. "Some of us were on the construction sites. But after two to three hours, we had had enough, and we preferred to play or gamble football," says Joschka. His own values have shifted. He could imagine children in his late thirties. For the next ten years, therefore, he does not need a house.

But due to the increased prices, the question arises as to how many degrees of freedom Joschka, in his mid-twenties, actually still has. Recently, his father stumbled upon an offer. Land price: 239 euros, more than four times the value during its first construction. Total cost: 750,000 to 800,000 euros. With an employee's salary of 2100 euros net, the purchase is an unrealistic goal, says the Darmstadt real estate economist Pfnür. "Joschka no longer has a chance of owning his own house. This is mainly due to the increased costs for land and buildings."

The guest toilet in Rolf and Sigrid's house is still in exactly the same condition as after construction.

He will have to pay twenty-four times his annual salary for his home. Even with a low repayment rate of one percent, debt servicing will account for ninety percent of net income. This is three times as much as sociologists and real estate economists recommend as a housing burden ratio, which should be thirty rather than forty percent. The generation of parents and grandparents, i.e. Carsten and Rolf Zimmermann, had also had to do without consumption in order to secure prosperity in old age. The fact that Carsten was able to cover the borrowing costs by opting for a rental apartment in the new building kept the costs within reasonable limits.

The ultra-low interest rates of the past decade have temporarily obscured the fact that conditions have changed significantly in the long term. From empirical studies on the impact of megatrends on the housing sector, Pfnür draws a considerable need for political action. "There is a lot of change in demand," he says. The city is becoming less popular. "At the same time, people are getting older and occupying a lot of superfluous square meters."

"In the past, a house provided security, but today you need security to finance a house."

FINN ZIMMERMANN, grandson

House and mobile home of Rolf and Sigrid Zimmermann in Bardowick near Lüneburg

The Zimmermann family has gathered on the narrow strip of garden at their house. She has used a large part of the area for the original house and the annex where Rolf and Sigrid have lived for a long time. For the grandparents, the camper will travel to southern Europe in a few days. The years when they had to save on holidays are a long time ago. Son Carsten praises them for how frugal they have been over the years. The guest toilet in the house is still in its original condition. Often, the desire for a home of one's own fails because of the demands, he has observed in his professional activity. But he also says he is worried about the social divide that keeps many away from the real estate market. Grandson Finn points out: "In the past, a house provided security, but today you need security to finance a house."

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