Costs of inheritance, demolition, new construction

  • Erstellt am 2013-11-19 19:13:23

norm

2013-11-19 19:13:23
  • #1
Hello everyone,

I have a few questions about incidental construction/demolition costs, I just can't find a comparable example for my case and maybe you can help me make things a bit clearer for me.

The following situation:

We (my mother, my brother, and I) inherited "a" house from my father. (1.5-family house, 115 sqm with usable basement) It is my grandfather's house and he still lives in this house (right of residence). My grandfather transferred it to my father back then. My mother inherited 50%, my brother and I each inherited 25%. My mother lives in the house where we grew up. My brother now has his own house. I currently live in a rented apartment. My grandfather is finding it increasingly too much with the house and he wants to move into assisted living. The house was built in the early 60s and has never been renovated.

So much for the initial situation...

Now to my question:

In the event that I want to demolish the house and rebuild, what costs should I expect? I imagine a 1.5-family house with 130 sqm with "residential basement." I don’t like the current house layout and everything would really have to be completely redone, so a new building might pay off.

With a new build, I always read about 35-40k incidental costs, but what would I face in my case?

Let’s assume the house with the land is worth 200k.

My mother and brother would gift me their shares. The 100k from my mother should be tax-free, 30k from my brother’s share I would have to tax (20k are exempt), is that correct? If the right of residence is removed, is the land/house then mine? There will probably also be notary and land registry fees?

Then the demolition – around 15-20k? Could I possibly save part of the earthworks in the new build since the "hole" is already there after demolition?

New build – incidental costs: Real estate transfer tax should then be replaced by gift tax (30k taxed), so those should not apply?

Development costs – those shouldn’t be that high, right? Since the connections are already at the house.

Notary / land registry as usual, surveying costs, building permit, construction electricity, etc... should all be normal, like in any other new build.

I already read a lot here in the forum, but I haven’t found an example like mine yet.

I have already written a lot (hope somewhat understandable), but maybe you can help me with some numbers as I am partly unsure what could be coming.

In short again:
- Amount of real estate transfer/inheritance/gift tax? Is it "only" the 30k taxed + notary costs?
- Demolition 15-20k, is that about right?
- Are the development costs then significantly less than for an "undeveloped" plot?
- What costs might possibly be waived or added in my example compared to a normal new build?

Thanks already for your answers.
Regards Norman
 

ypg

2013-11-19 23:10:49
  • #2
Warning, layman’s opinion: Treat inheritance and new construction separately. First, make sure the building belongs to you -> land register entry. That’s what inheritance law and notaries are for, who should be familiar with this (gift, right of residence, tax). In my opinion, the right of residence cannot be simply dissolved. Maybe the "right of residence" for assisted living has to be "taken into account"????



Additional building costs + demolition. Break down incidental building costs as well as possible and allocate proportionally. Maybe you can really save on earthworks (excavation), get an offer.



That would somehow be logical...



See above



The house is no longer there. The plot is fully developed, you have to pay again for the connection to the utilities (house connections).

Good luck!
 

Doc.Schnaggls

2013-11-20 08:28:15
  • #3
Hello Norman,

Regarding the demolition:

The costs for a demolition mainly depend on two factors: materials used and the size of the house. It is definitely advisable to obtain several offers and insist on a fixed-price quote. We have just completed the offer phase for the demolition of a similarly sized house from the 1950s and had offers ranging between 10,000 and 32,000 euros. In the end, we decided on a provider from our local area, even though they were not the cheapest.

Excavation work:

You can’t say whether it will be cheaper due to the hole left after the demolition. Is the new house going in the same place? Is construction planned with or without a basement – then possibly filling & compacting might be necessary? A architect can estimate this quite precisely.

Utility connections: electricity, water, telecommunications, you can expect about TEUR 6 - 8 if everything is already on the property. However, you should consider the following regarding electricity: If the old house still has a pole on the roof for the electricity connection, that doesn’t mean the new house will also have a pole on the roof. Many energy suppliers insist on underground cables for new buildings – which can then be even more expensive.

You should have the tax treatment clarified by a competent tax advisor or a binding inquiry with the tax office – nobody here on the forum can or may give you proper advice on this.

In which region is the house located?

Best regards,

Dirk
 

Koempy

2013-11-20 08:37:47
  • #4
Do you really want to demolish it just because you don't like the floor plan? Is the condition of the house that bad? Have you simply thought about it and calculated whether it might actually be worth renovating and refurbishing?

We are currently also facing buying a house from the 60s and renovating and refurbishing it. Demolition would be far too much of a waste and far too expensive.
 

Bauexperte

2013-11-20 10:23:43
  • #5
Hello Norman,


Yes, that is correct. For your brother’s share (25%) you would have to pay tax on 30k EUR; the amount depends on your tax bracket. The tax office can provide information on this.


Notary fees also apply for the gift; it has to be properly documented. As for how the lifelong right of residence can be handled – you need to consult a notary about this. I’m not sure if this right can be deleted that easily.


No one can answer that. Nobody here knows the house. It depends crucially on which materials were used in the house, how accessible the house is, etc. It could be 10k EUR or 20k EUR.

Regarding the “hole”: You may only build on natural ground. That means the soil has been altered by the demolition and must be compacted at a minimum. I would additionally recommend – as you rightly wrote, there is quite a large hole after demolition – having a soil survey conducted if one is not already available. It may be that due to sandy soils or seepage water you must apply special waterproofing to the basement. Better to know this in advance. Furthermore, the geologist states exactly in the report how the basement slab can securely be constructed on which type of material. If I remember correctly, it also states how and with what slope the basement demolition should be carried out.


Real estate transfer tax does not apply within the family.


That cannot be answered in general terms. Ask the utility provider how old the sewer pipes are – nowadays it is not uncommon that demolitions are used to replace clay sewer pipes with plastic ones. Every homeowner is also obliged to have a pressure test done every 12 years on the gas line. If cracks are detected, these lines must also be renewed; better that happens during the new build than later. Renovation of electrical wiring should generally not be necessary.


If things go badly – renewal of pipes – only the fact that you do not have to buy the land. Otherwise, all costs usual with a new build will apply.

Rhenish regards
 

klblb

2013-11-20 10:53:50
  • #6
Dumb question: does it make sense to keep the basement and build a new house on top of it? Of course, with prior inspection of the building structure/statics of the basement? Maybe the layout of the basement is not so important or the location of the stairs is acceptable and can be "reused" in a new design. With a light wooden house, there probably won't be massive problems with the statics and pipe runs can be relocated if necessary (wall penetrations in the basement or penetrations through the basement ceiling at a new position)

It would save quite a bit of cost.
 

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