Collaboration with developers: experiences

  • Erstellt am 2022-07-06 11:14:23

mayglow

2022-07-06 11:14:23
  • #1
Hello!

We are currently very interested in a townhouse being built by a developer. Unfortunately, our main contact person is on vacation at the moment, and I don’t want to excessively bother the representative (even though I have already done so a few times, oops). So I thought, for more general questions, I’d just ask the forum :)

We currently have, among other things, a building specification, but no contract draft yet. We are trying to assess ourselves where there might be potential additional costs beyond the fixed price ("special requests"), but in one or two areas we are still having difficulty estimating this.

Generally speaking: there is a lot of discussion here in the forum about ancillary construction costs etc. But with a developer, they are the builder and not me. Am I correct in assuming that we therefore don’t really have to worry about any "builder’s side" costs? A few general details are included regarding infrastructure (e.g. electricity, water, telecommunications are included), when I think of something like construction power, nothing is mentioned in the documents I have received so far, but basically I assume that is the developer’s responsibility since they are the builder?

There are often statements in the building specification like "according to structural design" or similar (excerpt: "The exterior walls above ground are made of sand-lime brick, if structurally required in reinforced concrete. All other load-bearing walls according to structural design.") or "as specified by the architect" ("In some areas, clinker brick slips, color tone and design as specified by the architect, will be used."). We do understand that with a townhouse built by the developer, we don’t have much choice in such matters and that is perfectly fine with us. But if I imagine we are in the construction phase and I send an expert there, handing them the building specification beforehand, such statements seem quite vague to easily check anything. (I mean, they will still be able to determine if something is completely botched in execution) Are such formulations normal or should they be specified in more detail?

What is the usual procedure regarding "special requests"? I had read that these are or can be part of the notarial contract. What is typically agreed before the contract is signed, and what only afterwards? So can I expect to have to select tiles and decide on sockets before signing the contract, or is it initially about more fundamental things (possibly moving a wall or similar)? We will certainly ask the developer ourselves about this, but it doesn’t hurt to know how this usually works ;) I imagine that the more I decide on beforehand, the more secure I am about the price — or is that assumption wrong?

Speaking of price. We are currently checking with banks, but are unsure how exactly to deal with the topic of "special requests." Our first impression is that we are quite satisfied with the standard in the building specification we have. There are one or two things we have a small question mark about (floors are included, tiles or parquet up to €30/sqm depending on the area ... is that enough or should we plan a buffer?), besides that, there are a few things we might want to add (possibly 2-3 more LAN ports for access points, possibly empty conduits for photovoltaics, possibly empty conduits in the garage for a wallbox OR depending on the price just have a wallbox installed directly). We would also be happy without these, but it just seems sensible to have these included now. Our original idea was that we would just pay for that out of pocket, independent of financing, but if it ends up in the notary contract and is an additional cost and we haven’t mentioned it to the bank, the price might be higher than what was communicated to the bank. Does the bank not care because it is our own funds, or is it possibly even foolish not to inform the bank, because it might improve the loan-to-value ratio? (House possibly worth more without additional bank funds). I mean, these are probably small things that won’t have much impact, but I am just a bit confused about how to handle this.
 

jrth2151

2022-07-06 12:21:54
  • #2
We are currently also building with a developer and are already two or three steps ahead. At the moment, we are waiting for the building permit. I can at least tell you how it went for us.

We saw a house through Volksbank that, like yours, is being built with a developer. Everything was already fully planned (floor plan, facade, carport, outdoor area, etc.). Everything was great.
We were very satisfied with most things, but we wanted to make adjustments to the ground floor and upper floor because I needed a study and my partner wanted a separate bathroom for us. We also changed a few windows. Even before the building contract and financing, we planned all the floor plan adjustments together with the developer, who was also able to immediately calculate a price of around €11,000 for us. We then included this as an extension in the building contract.
We were told to handle everything else best during the selection phase and later on. The most important thing is to get the building application done as quickly as possible because currently the waiting time is around 3 to 4 months. Occupying yourself beforehand with sockets and who knows what only causes more delays. Everything except the floor plan and the position of windows and doors can still be changed after the building permit.

As a buffer, we therefore calculated an additional €20,000. One more socket costs around €50, and the selection phase is still pending. We are currently planning with the standard, but you never know. It’s worth reading the building description and googling each model (sink, faucet, door, etc.) once to see if you are basically satisfied with it. Everything was fine for us so far.
In addition, I would like to have LAN cables laid, which will also cost a bit. However, I plan to do the patching and connecting the sockets myself. Painting and vinyl flooring are also still missing. Only the tiled areas (bathroom, hallway, utility room) are already included. We will see all of that when the time comes. What’s important for us is that with the €20,000, we can cover everything that can no longer easily be changed afterward. Flooring and painting can also be done after moving in. In the worst case, you just live on a construction site for half a year. I see the house as a life project anyway, so what’s a few months?

That gave us a framework for financing. Original price + floor plan adjustments + buffer. The more buffer you can afford, the better, but then watch out for special repayment options so you’re not stuck with the buffer money if you end up with leftover funds.

Our bank then took the total price in the building contract (construction costs + adjustments) as the house price, and we expressed that we would like to have a buffer. For us that was a maximum of €20,000 because we are basically financing fully. €10,000 from the bank and €10,000 from savings.

Only the land purchase contract was notarized for us. The building contract is a normal contract without a notary.

Regarding the other questions:
Construction electricity and water are included for us until the house water connections are installed. So as soon as the municipal utilities install a meter in the house, we pay. But that will only happen after the shell construction, etc. The worst part will already be done by then. Just in case, I have already secured us an electricity contract at 23 cents per kWh, which we will simply transfer from our apartment to the house.

What will also come up for you is the screed drying. For this, the heating apparently has to run continuously in screed drying mode for several weeks. According to experience reports and depending on the season, you can easily lose around €1,000 here with a heat pump.

As a small recommendation, I would like to mention Instagram. There are lots of families and builders who share their floor plans and ideas there. As a layperson, you naturally have no clue what exactly you want and how to design floor plans at all. For example, we took the layout of our bathroom from there. We just took a screenshot to the developer, who implemented it 1-to-1 and was very happy that we were so well prepared.

Otherwise, just ask the developer questions without end. You seem to have found a good developer. Our developer said from the beginning that we could pepper him with questions anytime. Better to ask once too often than to have problems later due to misunderstandings and knowledge gaps. That saves everyone a lot of work and headaches.
 

jrth2151

2022-07-06 12:30:02
  • #3
I forgot one important thing: Try to schedule the appointments (notary appointment, signing of the construction contract, signing of the financing) all very close together in time. For each of these contracts, you have a 14-day right of withdrawal. If anything should not work out, and you never know these days, you can simply back out of it. Our order was construction contract -> financing -> notary appointment. All within one week. This order makes sense because the notary needs the financing documents for the land charge.

Edit: Since no one ever mentioned this otherwise, but we were not entirely aware of it: A lot of smaller bills come at the beginning from all the authorities. It’s not much in total, but €1,000 can easily disappear here. For example, the registration in the land register costs €70. Then the house number costs €30. The notary fees of the land seller were €250, which we had to reimburse him, and so on.
 

Axolotl2022

2022-07-06 12:51:26
  • #4
Then it is quite simple. You are NOT building with a property developer, but with a general contractor. A property developer ALWAYS sells a finished product house with land. A property developer contract must also be notarized. Payments here are made according to the real estate agent and property developer ordinance and not arbitrarily. There are many other differences to your construction project.
 

jrth2151

2022-07-06 12:56:50
  • #5


Learned something new again. Thank you!
Overall, though, everything else is probably very similar.
 

Mahri23

2022-07-06 13:19:17
  • #6

If you do the patching and connecting the sockets yourself, then you can also manage to lay the few cables from the sockets to the utility room. ;)
I did that myself too. The general contractor had installed empty conduits. That made laying the cables no magic. I was also able to distribute our satellite cables and a few speaker cables in the attic that way.
 

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