Is a 5% security deposit withheld on the first invoice? Guarantee?

Hello everyone,
we are building with Fertighaus Weiss and have received the first invoice for the building application. Advance payment for the architect €8999. We have the following questions:

1. a) Is this added to the contract price or is it part of the contract price?

2. a) How does the security retention work?
b) Are we allowed to simply withhold the first 5% of the contract sum on the invoices and keep it until everything is correct at the end?

In our prefabricated house construction contract according to the Building Code it says: "Production securities claimed by the client in advance payments shall be provided by guarantees in the amount of 5 percent of the total remuneration owed."

What does that mean?

Thank you for your help!

How is anyone supposed to know what is included in your house price and what is not? Whether you are allowed to withhold something depends on your contract. If you accept trades individually, you can of course withhold full payment from each until the defects are remedied. With a general contractor, however, you usually make progress payments according to the construction progress. These payments do not necessarily have to correspond to the actual price of the respective trade. Roughly, however, it should match. You should make sure that you have not already paid 80% after the foundation slab. That would be significantly overpaid ;) The guarantee in the amount of 5% must be provided by means of a builder’s guarantee, as I understand it. This is definitely not to be understood as you not paying 5% at the beginning.

You have to provide the guarantee of 5% through a builder's guarantee, as I understand it. This definitely does not mean that you initially do not pay 5%.

That is wrong.

You request the security, and if the company then does not send a guarantee, you can withhold the 5%.

In our prefabricated house construction contract according to the Building Code it states: "Manufacturing securities claimed by the client for installment payments are provided by guarantees amounting to 5 percent of the total remuneration owed."

What does that mean?

Thanks for your help!

As manufacturing security, the contractor owes a 5% security of the owed total remuneration with a guarantee (usually a bank guarantee) according to the contract if an installment payment has been agreed. For example: 300,000 euros * 5% = 15,000 euros bank guarantee.

This is due before you pay the first invoice.

You have to provide the guarantee of 5% through a builder's guarantee, as I understand it. This definitely does not mean that you initially do not pay 5%.

Rarely have I read such nonsense. It may be that such a thing exists, but the wording of the OP is different.

"Security for production claimed by the builder for installment payments is provided by guarantees amounting to 5 percent of the owed total remuneration."

This concerns a performance bond.

To this we ask ourselves:

1. a) Is this added to the contract price or is it part of the contract price?

That depends on your contract.