Hello Oliver,
For terrain structures (hills, mountains etc.), styrofoam is a good alternative. More details on my homepage:
http://home.swipnet.se/perz/tt.html#foam. You can use putty or plaster on top of the styrofoam. Plaster is cheaper but I find putty easier to work with. Paint it with water colours. Styrofoam is destroyed by thinner based colours and thinner based glue.
A method to build realistic plaster rocks is presented on Peter Funck's homepage:
http://www.peter.funck.net/building.htm#Mountains.
Real soil and sand (as already mentioned) can be used to create bare ground areas. But you can also use spices like cinnamon, allspice, cardamom and black and white pepper for this.
For grass and other vegetation I would recommend commercial products. Among brands, Woodland Scenics is already mentioned, but also Heki, Busch and Faller have good products, just to mention some. You will find it in a model railway shop, but you can also look in wargaming shops (where they sell Warhammer stuff etc.).
Trees and bushes can be made of coloured lichen moss. The coloured lichen moss for model railways is rather expensive, but you can usually find prepared, but non-coloured, lichen moss at christmas time much cheaper. Then, you can paint it green. There are also several other ways to make trees.
Fences can be built from material you have at home or find in the nature, see e.g. my home page:
http://home.swipnet.se/perz/tt.html#fence.
To model streets, I use thick grey paper to model concrete and asphalt roads (different shades of grey of course). Paving-stone streets I print out on an ink-jet printer. You can download the paving-stone pattern (Powerpoint format!) from my homepage:
http://home.swipnet.se/perz/tt.html#street. Some other stone patterns that can be printed out are found on Peter Funck's homepage:
http://www.peter.funck.net/building.htm#Bricks. You can create your own patterns as well, in any suitable (or non suitable, as Powerpoint) drawing program.
Also, to make your money last longer, take a look at the German web shops, e.g.
http://www.lokshop.de/ or
http://www.modelleisenbahn.com/. You find more of them on the forum Links&downloads page. The prices are significantly lower there than in Sweden, but the shipment cost is added so you have to order rather much at a time to save money on it. If you have friends that share your model railway interest you can go together around a bigger order.
If you want to, I could send you some more specific information in Swedish, e.g. about materials that I use but don't know the exact English word for. In that case, contact me via the forum email function or via the contact form on my home page.