ᐅ Experiences with Building a Shell House on a Plot of Land
Created on: 27 Apr 2021 17:34
J
johbis2310
Dear forum members,
I am new here and impressed by the many very helpful posts. My partner and I might have the opportunity to acquire a building plot owned by a construction company. The condition for acquiring the plot is that you build a shell house in solid construction with this company. The shell house is custom-designed and includes the basic structure with foundation slab, windows, insulation, exterior rendering, utility connections for water and electricity, etc. Trades such as heating, interior doors, screed, staircase, flooring, bathroom, and interior finishing are not included. We would need to complete these after the shell house is finished. As an approximate price indication, they mentioned 1,300 - 1,600 per square meter (10.8 - 14.9 per square foot) of living space for the shell house. For the interior finishing, which is not included, they estimate €120,000 - €150,000 on our side for about 180m2 (1,938 sq ft) of living space.
Our questions: Has anyone had experience with such a concept—shell house/shell construction by a company versus organizing the interior finishing yourself? How was your experience? We are somewhat skeptical since it is not a full turnkey solution and the overall cost estimation seems difficult. What are your thoughts?
Additionally, we would need a second designer or architect because we are unable to coordinate the interior finishing professionally or time-wise ourselves. How have you handled this in similar situations?
Many thanks in advance for your feedback!!!!!!
I am new here and impressed by the many very helpful posts. My partner and I might have the opportunity to acquire a building plot owned by a construction company. The condition for acquiring the plot is that you build a shell house in solid construction with this company. The shell house is custom-designed and includes the basic structure with foundation slab, windows, insulation, exterior rendering, utility connections for water and electricity, etc. Trades such as heating, interior doors, screed, staircase, flooring, bathroom, and interior finishing are not included. We would need to complete these after the shell house is finished. As an approximate price indication, they mentioned 1,300 - 1,600 per square meter (10.8 - 14.9 per square foot) of living space for the shell house. For the interior finishing, which is not included, they estimate €120,000 - €150,000 on our side for about 180m2 (1,938 sq ft) of living space.
Our questions: Has anyone had experience with such a concept—shell house/shell construction by a company versus organizing the interior finishing yourself? How was your experience? We are somewhat skeptical since it is not a full turnkey solution and the overall cost estimation seems difficult. What are your thoughts?
Additionally, we would need a second designer or architect because we are unable to coordinate the interior finishing professionally or time-wise ourselves. How have you handled this in similar situations?
Many thanks in advance for your feedback!!!!!!
ypg schrieb:
That is the role of a construction manager: to oversee the house building process.
He is not an expert who rescues you from every problem. If I am managing the build myself and hire a construction manager, then he monitors the construction on my behalf; I would expect him to keep an eye on flawless workmanship. The project manager of a developer has different priorities, as @11ant rightly pointed out:
11ant schrieb:
that defects only become visible after the warranty period through the filler material breaking through
Of course, a reputable company cares about its good reputation. It is not their main goal to take advantage of the homeowner. But ultimately, the saying "You are beholden to the one who pays your wages" applies. So the homeowner has to pay for the bread.
J
johbis231028 Apr 2021 09:11Thank you in advance for the feedback.
There is a limited liability company (GmbH) that owns the land and another GmbH that takes over the shell house. Both companies belong to an overarching GmbH. The plot is known. Therefore, there are two contracts: one for the land and one for the shell house.
Thank you for the information. Was the site manager who coordinated the completion involved in the planning from the very beginning, or only after construction had started on the shell house? Did he prepare the cost estimates for the remaining trades?
Thanks!
11ant schrieb:
Does the company really own it? – the keyword "short sale" in the search helps clarify this.
There is a limited liability company (GmbH) that owns the land and another GmbH that takes over the shell house. Both companies belong to an overarching GmbH. The plot is known. Therefore, there are two contracts: one for the land and one for the shell house.
Altai schrieb:
I bought a house in about the described condition. Not specifically labeled as a "shell house," but it was offered in that state. The seller would have completed the construction if I had commissioned him to do so.
I hired a site manager who coordinated and supervised the completion. He arranged the subcontractors, monitored the construction, checked the invoices...
In the end, it cost more than originally estimated, around 1000€/sqm (93 USD/sqft), just to give a figure. Standard quality without any special extras.
Thank you for the information. Was the site manager who coordinated the completion involved in the planning from the very beginning, or only after construction had started on the shell house? Did he prepare the cost estimates for the remaining trades?
Thanks!
Altai schrieb:
Of course, a reputable company cares about its good reputation. Their primary goal is not to take advantage of the client. However, when in doubt, the saying "He who pays the piper calls the tune" applies. So, ultimately, the client has to pay. The general contractor simply pays their site manager to prevent any reduction in their profit due to warranty repairs. How well this is achieved by avoidance, or how long defects remain undiscovered, is secondary. The client’s hope that quality will be monitored as if building their own first home will only be fulfilled by a site manager they have hired themselves. This could also be an independent expert, but in my opinion, no one conducts a project better than the person who designed it, which is why I prefer architect-led site management.
johbis2310 schrieb:
The plot is known. Therefore, there are two contracts: one for the plot and one for the shell house. The good news is that it is at least not an empty sale—but the bad news is that land transfer tax (also known as stamp duty or property transfer tax) is due on the construction as well—in this case, of course, not on the finishing work. If the provider subscribes to the “two-company” trick theory, they are not trustworthy and do not deserve to do business with you. Tax authorities are organized in such a way that this trick cannot work—even in the most remote locations (except through illegal cooperation by the client).
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
johbis2310 schrieb:
Did you involve the construction manager who coordinated the completion right from the start of the planning, or only after construction began on the "shell and core" house? Did he prepare the cost estimate for the remaining trades?
Thank you! The house was built by the seller up to the stage of "walls and roof." After that, it was on the market for quite some time. Neither I nor my construction manager were involved in the initial building phase.
Originally, the seller offered to complete the house, and the later construction manager was supposed to provide professional supervision for me because I didn’t feel confident doing it myself (rightly so, by the way!). After doing some research on the seller, I decided not to continue working with them.
The construction manager then contacted companies and gathered quotes, which helped establish a budget for completing the work. Once it was clear that the budget was manageable, I finalized the purchase. After that, the completion phase began as a self-managed project, supervised and coordinated by the construction manager.
Is that clear now?
Yes and no – offering only the shell construction (plus) is not just a niche, but also quite a profitable approach.
Why approach? We have also been offered projects of this kind, and I would be interested to know the general contractor’s motivation for offering such a model. Is it related to warranty issues?
Why approach? We have also been offered projects of this kind, and I would be interested to know the general contractor’s motivation for offering such a model. Is it related to warranty issues?
Chloe83 schrieb:
Why is it a scam? We have also been offered projects of this kind, and I’m curious about the general contractor’s motivation for offering such a model. Is it related to warranty issues? Warranty issues, yes, among other things: the finishing trades cover much of the shell structure, which means defects become visible only after a delay. However, you can address this by hiring your own expert to inspect the shell stage. The simple trick is that it’s easier to make money on the shell construction: although the interior work is more intricate and time-consuming, and actually involves more added value, the shell stage disproportionally allows the client to already “recognize the house.” Furthermore, many finishing trades are those that renovators or even tenants have dealt with before and feel more confident judging, so those areas are more competitive price-wise. Together, these factors cause clients to underestimate the value of the finishing trades and ultimately be willing to pay more for the shell than its actual share of the overall house cost. Focusing especially on “bargain hunters,” offering “shell only” or “minimally expanded shell” models makes it easier to profit than from the shell portion of a complete house. There is no easier target than “price-conscious” clever buyers. Simply put, a builder makes better profits on the entire house with higher-end finishes (and the target group for that), and better profits on the shell only (plus) with low-cost finishes (and the target group looking for bargains).
https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/
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