Hello everyone,
After long negotiations and many discussions, we would now like to place the planning order with our chosen general contractor for our single-family home. For this purpose, we have been presented with a contract for the necessary architectural services to submit the building permit / planning permission application.
The general contractor requests 10,000 euros upon submission of the building permit application and 8,000 euros upon receiving the building permit.
These costs will later be credited in the construction contract.
Is this price and procedure common?
After long negotiations and many discussions, we would now like to place the planning order with our chosen general contractor for our single-family home. For this purpose, we have been presented with a contract for the necessary architectural services to submit the building permit / planning permission application.
The general contractor requests 10,000 euros upon submission of the building permit application and 8,000 euros upon receiving the building permit.
These costs will later be credited in the construction contract.
Is this price and procedure common?
T
toxicmolotof14 Dec 2016 17:45Is there a flaw in the reasoning somewhere? I don’t quite understand which points in time you mean.
Well...
we just signed a construction contract, and the cost plan specified that 5% of the total amount is due when submitting the building permit application. That should cover the planning costs, so that makes sense. However, the general contractor has nothing to do while the building authority processes the approval. So why the $8,000? After all, they also wait to see if the permit is granted before continuing.
And why hasn’t a construction contract been signed yet????
we just signed a construction contract, and the cost plan specified that 5% of the total amount is due when submitting the building permit application. That should cover the planning costs, so that makes sense. However, the general contractor has nothing to do while the building authority processes the approval. So why the $8,000? After all, they also wait to see if the permit is granted before continuing.
And why hasn’t a construction contract been signed yet????
B
Bauexperte14 Dec 2016 22:49ypg schrieb:
However, the general contractor has nothing to do while the building authority works on the approval. Not quite right...
I assume the original poster wants to keep all options open, while the general contractor presents their "normal" payment steps. Usually, by the second payment, the soil investigation and structural engineering are completed.
Best regards, Bauexperte
Bauexperte schrieb:
Not quite correct …
I assume the original poster wants to keep all options open, while the general contractor sets out their standard payment schedule. Usually, by the second payment, a soil report and structural calculations have been completed.
Regards, BauexperteYep! But the structural calculations are probably only done once the construction contract is signed. So, a payment after receiving the building permit/planning permission doesn’t really make sense.
Edit: …although I’m wondering what is meant by “receipt of building application” when there already is a “handover of building application.”
Regards