Land plot demolition costs

Hello everyone, I had my first conversation with a developer yesterday. He wants to add demolition costs to the land value. The calculation is 255 euros per sqm plus 70 euros demolition costs per sqm. It seems quite high to me, the location is good, but demolition costs should normally be deducted from the land value, or what experiences do you have?

What is supposed to be determined for what and how? There is still missing information about what exactly is supposed to happen.

Understood nothing except demolition.

Who currently owns the property? What is (still) on the property?

So, the building plot covers approximately 400 sqm and currently there is still a commercial business on it, a former beverage trade. The surroundings look like there used to be a very small commercial area there many years ago. Meanwhile, many single-family houses have been built in this traffic-calmed zone and the commercial properties have been demolished bit by bit. Now, only an old bungalow, this beverage trade, and a warehouse remain. Except for the warehouse (approx. 600 sqm), everything will be demolished and 11 semi-detached/single-family houses will be built. We are interested in one of the single-family houses. However, the standard land value for these last buildings is 100 euros per sqm and for the single-family houses surrounding this part of the street the land value is 230 euros per sqm, partly even 290. The developer now estimates costs for the plot at 250 euros per sqm and demolition costs of 75 euros per sqm. No idea who owns the plot, and a commission will be added, so I assume the developer does not own the plot. My questions: - Usually, the owner of the plot pays the demolition costs, or is it common that I as the buyer take over the costs? - The price seems completely excessive to me or is it usual to deviate so strongly from the standard land value in this situation where a commercial area is converted into a residential area? - The bank could also have problems with the financing at such a low standard land value, right?

Hello,

I still need some info:

BT means you get house & land from a single source. Is this the case for you, or are you buying the land from a third party?

Except for the warehouse (approx. 600 sqm), everything will be demolished there and 11 semi-detached houses/single-family homes will be built. We are interested in one single-family home.

You are supposed to pay €75.00/sqm again for the demolition of the beverage trade with your land share of 400 sqm. Correct? Or do the 11 new owners share all demolition costs?

-As a rule, doesn't the owner of the land pay the demolition costs, or is it common that I as the buyer take on the costs?

No for the first part of the question and yes for the second.

-The price seems completely exaggerated to me, or is it usual to deviate so strongly from the standard land value in this situation when converting a commercial area to a residential area?

Standard land values are "only" approximate values; there is no obligation for land sellers to adhere to them; ultimately, supply & demand always determine prices.

Rhenish regards

-As a rule, does the owner of the property pay the demolition costs, or is it common for me as the buyer to take over the costs?

Well, generally speaking, there isn't really a standard practice.

The following two scenarios are possible:

1. You buy the property with the old building and pay the land value minus demolition costs.

2. The previous owner demolishes the old building and you pay the standard land value.

However, the municipality's standard land values should only be seen as a reference. Here, too, supply and demand determine the price. Whether it is then exaggerated is hard to judge – if the seller can sell at this price, the corresponding demand will be there – otherwise, one can wait for a correction downwards...

Regards,

Dirk