How successfully did you negotiate?

Hello,
I have been following this thread from the very beginning and would now like to speak up:
1. We are all - at least I believe so - in agreement that negotiation successes here are not comparable.
2. A better condition at a bank is not always only due to the submitted comparison offer. It can also be that the market interest rate has changed in the meantime. However, this is not transparent for the customer and can just as well backfire.
3. A deal must be "fun" for both sides. Otherwise, it is better to leave it alone, even if you think you are on the better side. Otherwise, the other party will try to compensate for their disadvantages in other ways.

My approach when I want to compare offers (also unrelated to house construction):
1. Obtain offer(s) (providers with suitable quality) to get a price idea
2. Sit down with my preferred provider and ask for the (final) price with which we are both happy. Usually, that fits quite well from the start. If not, I say that the price is too high because the competition has presented me with cheaper offers. This saves me the running around and also the time (and that of my business partners).
Good products and good service cost money – everyone must be aware of that.

: Exactly, point 3 is also my thought. If I push the contractor too hard, whether BU or bank, it will be difficult to achieve any later concessions and a basis of trust. If my customers haggle over the last cent beforehand and demand a reduction of the invoice amount after an assignment due to supposedly unmet expectations, I also become stubborn accordingly, and this will also affect future orders.

This additional time effort can possibly be compensated by the other party later, if possible. Haggle yes, but not at any cost.

With my earthworks company, too, I briefly negotiated due to the overall effort being significantly higher than previously planned after comparing offers. One minute, then there was a 2% discount, that was the highest feeling and perfectly fine. But I wouldn’t have pushed it any further, after all, he is creating the basis for our future home!

We also didn’t negotiate further with our bank; we were more than satisfied with an interest rate of 1.84% for 30 years for the majority of the loan.

That's exactly about those 15-20BP.

Good morning,

No! What you as a seller can often rely on is that potential builders assume that very easily. The thought that - if it actually were the case - they have been cheated without reason seems to occur to only very few.

You are not being cheated just because they set their profit margin a bit higher and then reduce it a bit if needed. You can't really compare house providers properly anyway, so there is no need to offer a cutthroat price (except for a few special companies). The desired discount is of course already included under the item "profit."

Now you got it! Add: "+/- € 5/7,000.00 for comparable performance" and I fully agree with you.

Not necessarily. It can also be that his cost structure, his contribution margin, has to be set higher.

Of course there are differences, but not with a simple chimney in the same house in a regional area. I really got some offers and completely dissected the construction descriptions, for example, and created Excel sheets, etc.
The essence of it all was that the extras always cost the same (6/6 companies) and a cheaper price always corresponded to a lower specification.
Ultimately, the deciding factors for awarding the contract were the builders/neighbors and the good feeling of building with a "professional." Signed end of April, started mid-June, screed comes in two weeks. Everything is running exactly on schedule, we haven't found any real botching yet. And I read the DIN and such jokes to get started myself right away...

There are specialists for that; but of course, they cost money. Money which will later be regretted not having been invested

There are specialists for everything and that is a good thing. For me personally, I didn't feel that such a person could greatly help me with the decision-making. I am a planner myself and was taught in my studies to deal with every subject in depth. You can see that we made the right decision from the section above...
Others maybe don't have the inclination to go through the bb word by word over the weekend and read the necessary knowledge. And they can then hire a professional. Why not...

A quick update: we have now been to 2 banks and the first bank presented us with an offer for 20 years, which at 2.38% was not exactly attractive. When I followed up, we received a 2nd offer with 2.18% and when I then said that we had received an offer below 2% from another bank, we ended up at 1.97% effective. And my impression is that there is still room for improvement, because we were clearly told that they would be happy to win us as customers... of course with the prospect of follow-up business But that’s as much as about the topic of negotiating is not possible...

2.38 is currently also 20BP too expensive from the start.

Therefore, a realistic comparison interest rate for 60% is about 2.2%, which you have now undercut by 20BP.

That is good, but at the edge of what is feasible. If the market level does not change now, you will stay there.

Less is not possible because otherwise the bank/insurance cannot cover the costs (1.50% is currently a risk-free refi).

PS: What use is it in the long term if the house construction is already 40TEUR more expensive than planned before the start of construction without extra requests? Then you simply pay the additional costs not at the bank, but to the craftsman.

Well, the question is whether this is always followed. Ultimately, the bank can get the money from the ECB at 0.15%. Even 1.5% would therefore still be a profitable business for the bank, I guess. But well, let's see what else is possible now. Your objection is justified, which is why we negotiate at both interfaces - developer and bank