Stop or pause house construction? Costs too high

Good morning,

my husband and I want to build a house.
The plot is available. We are currently in an unpleasant situation.

We roughly planned the house with an architect, it went very quickly.
No building application has been submitted yet and no detailed execution planning has taken place.
The architect gave a cost estimate that surprised us a lot.
Of course, we had previously asked acquaintances, friends, and family members what their building projects cost.
Obviously recent projects.
The architect's estimate is more than double what we initially thought. Specifically, between 4500-5000€/sqm.

We then consulted a few others from the area and two from a bit further away. All of them agree relatively well on the construction costs.
I am not allowed to publish the documents here, but it is really nothing extraordinary. A KW40+ house with 198sqm living and usable space and a double garage attached on the left side of the house. Of course, no basement.
The equipment was described to the architect as normal-standard. No marble floors, no smart home. A simple house like my uncle’s but new.

It comes down to the house supposedly costing 1 million already. Plus of course additional costs, architect fees, outdoor facilities, etc. Including the plot, the total sum is so high that we can neither finance nor afford it.
Unfortunately, the architect had to do a certain amount of work before he could estimate the costs.

Now we are worried that if we cancel the construction, the architect will want 15-20 thousand euros from us for the work he has already done.

What would you do in our place?

Best regards, Coffee

You can take the architect's floor plan and go to various general contractors to get a fixed price offer. Are you in the Munich area? If not, you should be able to find a significantly cheaper provider.

Otherwise, the usual: plan fewer square meters, get rid of the "hobby" KfW40+ (you have to be able to afford that), less equipment and special features. Carport instead of double garage.

Cost risks currently arise from the imminent elimination of the KfW55 subsidy (possibly more sensible for you) as well as from upcoming tightening of energy standards by the coalition government.

So the architect's estimate is more than double what we initially thought. Namely, 4500-5000€/sqm.

Wow!!! How does he manage that? That will be a luxury villa. Or what has he included in the calculation?

What did you discuss with the architect beforehand regarding your budget? 198sqm KfW40+ is no longer a standard house in itself.
I only know construction costs from my clients (in multi-storey residential buildings) if it is genuine luxury. And by that, I mean luxury.

Unfortunately, the architect had to do a certain amount of work before he could estimate the costs.

That is nonsense. He already knows the costs (roughly) when you have the first conversation with him.

You can take the architect's floor plan and go to various general contractors to get a fixed price offer. Are you in the Munich area? If not, you should be able to find a significantly cheaper provider.

We want to build in Gifhorn. It is close to Wolfsburg.

You can take the architect's floor plan and go to various general contractors to get a fixed price offer.

Already tried. Either they are all very busy, or maybe they just don’t like our style, but they seem noticeably uninterested from the start. Some simply don’t respond at all.

Otherwise the usual: plan fewer square meters, get rid of the "hobby" Kfw40+ (you have to be able to afford that), less equipment and extras. Carport instead of double garage.

Already tried. Doesn’t reduce the costs as much as it cuts into quality. Unfortunately.

Wow!!! How does he manage that?

We don't know either. It makes us very suspicious that others estimate similarly.

What did you discuss with the architect beforehand, how does your budget look? 198 sqm KfW40+ is no longer a standard house.
I only know the construction costs with my clients (in multi-family housing) if it’s real luxury. And by that I mean luxury.

Unfortunately, we didn't talk about the budget. We informed ourselves through various acquaintances and their costs were quite okay for us.
KfW40+ is not a standard house, but that’s it. No luxury was requested and none is needed.

That’s nonsense. He already knows the costs (roughly) when you have the first conversation with him.

His argument was that he has to sketch and prepare something first in order to even be able to estimate.
We could hardly argue against that.
That is how his preliminary floor plan was created.

Do I understand this correctly? You want to cancel the entire construction if you don't get the standard you want? You will probably have to pay the architect. Of course, it is questionable what he has accomplished in the probably short time.

Otherwise, I would annoy other construction companies and follow up. If they don't respond, call, call, call.

Out of interest: I would already consider 198 sqm to be luxury. Can you write a little more about the project? I assume you are not building on a slope, but maybe there are other cost drivers?