Can a construction company suddenly increase costs despite a suspensive condition?

You guys seem to be cutting it pretty close anyway. Did you never expect the prices to get more expensive?

In the end, you have to mention: whoever enters into a contract with a dumping price must confront their own fault. At least, that's what they say with online offers that are 20% below market price.

We were in the same situation with a prefab house and public funds from 2021 to 2024. 24 months fixed price commitment. Over 13 of those months, the district took time for the review of the housing subsidy (Corona... usually a maximum of 6 months was customary and planned here), so finishing within the remaining time was no longer conceivable. In the end, we also ended up with a 9% additional payment for another 12 months. Including a renewed complete feasibility review by the authority because the construction sum changed significantly as a result. Now we are still waiting, 6 months after the notification of completion, for the final disbursement of the remaining loan amount...

I assume that you "only" have a right of withdrawal if the loan is not approved. That was the case with us too, maybe take another look at your contract for work. What can become a further problem: Normally you also get the new offer with a 12-month price lock. If the building permit takes another 6 months now, it will become tight again with that, and the construction company may possibly ask for more money again.

At the end of the day, it makes no difference either way. Even if the fixed price commitment were to start only in July 2024, if you submit the building application this month, construction would begin at the earliest in spring/summer 2025. Nothing will happen at the building authority this month and probably not at the beginning of January either, and you should expect about 3–6 months. That means the fixed price commitment expires when construction starts, and if necessary, the company will increase prices at the latest then. I would perhaps rather try to renegotiate the percentages with them and draw up a contract supplement that guarantees you that the negotiated percentages will remain until the end of construction. So that they don’t raise the prices once now and then a second time by the end of 2025. In the sense of: “We find that crap now, but we’ll meet you halfway and accept the X% if you give us a renewed fixed price commitment.”

Thank you for your feedback. Our building permit is in place and we are practically already tinkering with the basement planning, etc. The house is supposed to be delivered in April/May. So still completely within the 12 months.