ᐅ Current situation regarding installation times / delivery times?
Created on: 30 Oct 2021 12:11
C
Caypirinha
Hello everyone,
what are your current experiences with delivery times / installation periods for timber frame houses?
We had a conversation yesterday with a prefabricated house company that can only start installation in Q4 2023. That’s 2 years! At least they offer a generous fixed price guarantee for 24 months...
That means I would sign the construction contract now and could already take out the loan. Typically, the interest-free loan availability period is 12 months, which means I would have to pay rent plus interest for about a year and still hope the house is delivered within the 24-month fixed price guarantee, otherwise it will become even more expensive...
Is that normal? The seller said this is usual given the current building material situation, and that you should be suspicious of any manufacturer promising shorter delivery times. I know that’s obviously a marketing argument, but it did make me a bit uneasy...
That’s why I wanted to ask what installation or delivery times you have been told?
We have already been in contact with other prefab house manufacturers who guaranteed delivery within 8 months after obtaining the building permit / planning permission. Well, it would be unfortunate for us if the architect from the prefabricated house company then needs 12 months just to prepare the required permit plans...
what are your current experiences with delivery times / installation periods for timber frame houses?
We had a conversation yesterday with a prefabricated house company that can only start installation in Q4 2023. That’s 2 years! At least they offer a generous fixed price guarantee for 24 months...
That means I would sign the construction contract now and could already take out the loan. Typically, the interest-free loan availability period is 12 months, which means I would have to pay rent plus interest for about a year and still hope the house is delivered within the 24-month fixed price guarantee, otherwise it will become even more expensive...
Is that normal? The seller said this is usual given the current building material situation, and that you should be suspicious of any manufacturer promising shorter delivery times. I know that’s obviously a marketing argument, but it did make me a bit uneasy...
That’s why I wanted to ask what installation or delivery times you have been told?
We have already been in contact with other prefab house manufacturers who guaranteed delivery within 8 months after obtaining the building permit / planning permission. Well, it would be unfortunate for us if the architect from the prefabricated house company then needs 12 months just to prepare the required permit plans...
Caypirinha30 Oct 2021 20:01Thanks for your replies!
Regarding the loan, we have considered the following:
1. We just bought the plot and mostly financed it using equity. However, we had to finance a small part (variable interest rate – 2.5%). Fortunately, this is a very manageable installment because, as I said, we covered the majority ourselves. Overall, the installment would still be cheaper than the commitment interest. But...
2. [Main reason] As everyone knows, interest rates are currently very low. But given the current inflation rate, we expect the ECB will soon take action and raise the key interest rate during 2022 (similar to the announcements from the US). If the interest rate increases by even 0.5%, it would be more expensive over a 30-year term than paying a 3% per year commitment interest for one year.
Yes, unfortunately I fear the same... Who did you build with and who did you contact back then? So far, Streif Haus, Okal Haus, and Elk have told us delivery times of more than 12 months. But as mentioned: they often have phrases like "starting from building permit" and I think they just use other methods to delay the permit (basement builder, architectural plans...)
What exactly do you mean by that? The timber prefab manufacturer doesn’t issue the permit, but rather prepares the plans with which YOU obtain the permit from the building authority, right? Or did I misunderstand you?
11ant schrieb:
I think it’s a misconception to already calculate the funds as available at the time of ordering.
MayrCh schrieb:
What do you expect to gain by taking out a loan now?
Regarding the loan, we have considered the following:
1. We just bought the plot and mostly financed it using equity. However, we had to finance a small part (variable interest rate – 2.5%). Fortunately, this is a very manageable installment because, as I said, we covered the majority ourselves. Overall, the installment would still be cheaper than the commitment interest. But...
2. [Main reason] As everyone knows, interest rates are currently very low. But given the current inflation rate, we expect the ECB will soon take action and raise the key interest rate during 2022 (similar to the announcements from the US). If the interest rate increases by even 0.5%, it would be more expensive over a 30-year term than paying a 3% per year commitment interest for one year.
MayrCh schrieb:
That was already very unusual when we built (6 years ago). A one-year lead time was the standard, and the market hasn’t necessarily developed more favorably for buyers since then. How does the salesperson want to guarantee that?
Yes, unfortunately I fear the same... Who did you build with and who did you contact back then? So far, Streif Haus, Okal Haus, and Elk have told us delivery times of more than 12 months. But as mentioned: they often have phrases like "starting from building permit" and I think they just use other methods to delay the permit (basement builder, architectural plans...)
Elokine schrieb:
The offers we obtained last August were already as follows:
- local solid construction builder: 14 months from contract signing to start of construction plus 10 months construction time. But I recently heard it’s even longer now.
- timber prefab manufacturer active in southern Germany: setup 56 weeks after building permit issuance (we alone had to wait 12 months for that...) plus finishing time.
What exactly do you mean by that? The timber prefab manufacturer doesn’t issue the permit, but rather prepares the plans with which YOU obtain the permit from the building authority, right? Or did I misunderstand you?
A
Aloha_Lars30 Oct 2021 20:12Caypirinha schrieb:
2. [Main reason] As everyone knows, interest rates are currently very low. However, given the current inflation rate, we expect the ECB to take action soon and raise the key interest rate during 20222 (similar to announcements from the US). Even a 0.5% increase in interest rates over a 30-year term would be more expensive than a one-year commitment fee of 3% per year. That sounds like quite a bit of speculation, doesn't it? I find it very unlikely that the ECB will raise interest rates so quickly in such a short time just because of global supply chain bottlenecks, which are likely to be resolved next year.
Also, you compare it to a one-year commitment fee. Who guarantees that this will be the period? It will take much longer until you have spent the last euro...
For this bet, I would never take out a loan now. Even if interest rates rise slightly, they are still historically low. But everyone must decide for themselves.
Caypirinha schrieb:
What exactly do you mean by that? The timber prefab house manufacturer doesn’t issue the approval themselves; they prepare the plans with which YOU apply for the building permit / planning permission from the building authority, or am I misunderstanding you?No, you are misunderstanding. This house manufacturer waits to include the house in their production schedule until the building permit from the district office is granted. With fast processing by the authority or exemptions, that might only take a few weeks. In our district, one year is already considered fast.Only then does the production lead time of 56 weeks start.
That was also one reason why this offer was not an option for us.
Caypirinha31 Oct 2021 21:14Elokine schrieb:
You misunderstood. This house manufacturer waits to include the house in their production schedule until the building permit / planning permission from the local authority is granted. With quick processing by the authority or exemptions, it might only take a few weeks. In our district, however, one year is already considered fast.
Only then does the 56-week production lead time begin.
That was also one reason why this offer was not an option for us. Wow, those are really long processing times at your authority! With the BayBo 2021, the approval time here is hopefully limited to 3 months.
Caypirinha schrieb:
Wow, those are intense processing times at your authority!
With the BayBo 2021 regulation, the approval process here is hopefully limited to 3 months. I can only wish you that. We are also in Bavaria, and our architect said that he doesn't expect faster processing in our district due to the new regulation. Because of staff shortages at the district office and a flood of applications, the strategy over the past two years has been to send (unnecessary) inquiries 6 months after the application is submitted, which is the previous deadline, effectively restarting the clock. This is unlikely to change anytime soon.
Caypirinha schrieb:
So far, Streif Haus Haus, Okal Haus, and Elk have indicated delivery times of over 12 months. Interestingly, our contract with Streif Haus Haus (from February this year) states that Streif Haus Haus will begin work on the construction site within three months after the client-side delivery conditions have been met. The next sentence specifies that the handover of a turnkey (meaning, for Streif Haus Haus, ready-to-move-in including flooring etc.) house takes place within four months of the start of construction. I am not sure how Streif Haus Haus could delay this any further. Their website also mentions sufficient material stock (especially timber), so delays should not occur.