ᐅ Costs for Shell Construction and Roof Covering/Insulation – Is a Fixed-Price Quote Acceptable?
Created on: 9 Oct 2018 13:40
B
Bau_dus
I am trying to assess whether the price offered to me for building a house is reasonable.
Model: An architect builds houses at a fixed price through his company. He purchases a plot of land, demolishes the existing buildings, and constructs two semi-detached houses on it. I am being offered the plot + demolition of existing structures + shell construction + roofing/insulation/gutters + garage at a fixed price (notary basis). The interior finishing will be contracted separately by me; for this, I have price quotes per trade, executing company, and scope of work from the architect. The architect does not earn any profit from the interior finishing (I only pay a flat fee of €5,000 (approx. $5,400) for his construction manager), meaning his profit is fully included in the “notary basis.”
After deducting the market price of the land, passed-on purchase-related costs + 50% of demolition costs (including basement) + subdivision, approximately €400,000 (approx. $430,000) remain for the fixed price covering planning + shell construction + roofing/-insulation + garage + profit.
Here is my estimated cost breakdown based on my research (I am not an expert) and I would appreciate your review for general accuracy:
Details: 1.5-story semi-detached house, 8 x 13 m (26 x 43 feet), attic converted into living space, reinforced concrete basement, built according to the 2016 Energy Saving Ordinance, about 1000 m³ (35,300 ft³) enclosed volume (my calculation based on sections).
1) Earthworks + shell construction: approx. €150,000 (approx. $161,000)?
(Basement: 36.5 cm (14 inches) masonry or concrete, party wall made of sand-lime brick; load-bearing masonry: sand-lime brick + 120 mm (5 inches) core insulation + facing bricks (€0.5 per brick), non-load-bearing: sand-lime brick/brick/plaster walls; ceilings: reinforced concrete, stairs from basement to attic: reinforced concrete)
2) Masonry + facing bricks garage 9 x 5 m (30 x 16 feet): approx. €30,000 (approx. $32,000)?
3) Roofing + insulation + gutters: approx. €50,000 (approx. $54,000)?
(approx. 160 m² (1,720 ft²) roof area (my calculation based on sections), roof frame made of softwood, quality concrete tiles on roof membrane, gutters + downspouts in zinc, insulation meets requirement for living attic and attic conversion)
4) Architect and engineering services: approx. €35,000 (approx. $38,000)?
Subtotal costs: €265,000 (approx. $284,000)
Remaining amount (€400,000 - €265,000): €135,000 (approx. $145,000)
- of which VAT: €22,000 (approx. $24,000)
- of which profit/margin: €113,000 (approx. $121,000)
a) Does this allocation of the fixed price seem realistic?
b) Is the margin/profit typical for the market, considering that no additional profit comes from the interior finishing?
Thank you in advance for any feedback!
Model: An architect builds houses at a fixed price through his company. He purchases a plot of land, demolishes the existing buildings, and constructs two semi-detached houses on it. I am being offered the plot + demolition of existing structures + shell construction + roofing/insulation/gutters + garage at a fixed price (notary basis). The interior finishing will be contracted separately by me; for this, I have price quotes per trade, executing company, and scope of work from the architect. The architect does not earn any profit from the interior finishing (I only pay a flat fee of €5,000 (approx. $5,400) for his construction manager), meaning his profit is fully included in the “notary basis.”
After deducting the market price of the land, passed-on purchase-related costs + 50% of demolition costs (including basement) + subdivision, approximately €400,000 (approx. $430,000) remain for the fixed price covering planning + shell construction + roofing/-insulation + garage + profit.
Here is my estimated cost breakdown based on my research (I am not an expert) and I would appreciate your review for general accuracy:
Details: 1.5-story semi-detached house, 8 x 13 m (26 x 43 feet), attic converted into living space, reinforced concrete basement, built according to the 2016 Energy Saving Ordinance, about 1000 m³ (35,300 ft³) enclosed volume (my calculation based on sections).
1) Earthworks + shell construction: approx. €150,000 (approx. $161,000)?
(Basement: 36.5 cm (14 inches) masonry or concrete, party wall made of sand-lime brick; load-bearing masonry: sand-lime brick + 120 mm (5 inches) core insulation + facing bricks (€0.5 per brick), non-load-bearing: sand-lime brick/brick/plaster walls; ceilings: reinforced concrete, stairs from basement to attic: reinforced concrete)
2) Masonry + facing bricks garage 9 x 5 m (30 x 16 feet): approx. €30,000 (approx. $32,000)?
3) Roofing + insulation + gutters: approx. €50,000 (approx. $54,000)?
(approx. 160 m² (1,720 ft²) roof area (my calculation based on sections), roof frame made of softwood, quality concrete tiles on roof membrane, gutters + downspouts in zinc, insulation meets requirement for living attic and attic conversion)
4) Architect and engineering services: approx. €35,000 (approx. $38,000)?
Subtotal costs: €265,000 (approx. $284,000)
Remaining amount (€400,000 - €265,000): €135,000 (approx. $145,000)
- of which VAT: €22,000 (approx. $24,000)
- of which profit/margin: €113,000 (approx. $121,000)
a) Does this allocation of the fixed price seem realistic?
b) Is the margin/profit typical for the market, considering that no additional profit comes from the interior finishing?
Thank you in advance for any feedback!
Bau_dus schrieb:
So, €400,000 put up for discussion here Hmm, sounds reasonable so far.
However, in my opinion, you might have forgotten some additional construction costs. Utility connections, removal of basement excavation—are these included separately?
The plot doesn’t necessarily have to have been cheaper just because the architect is well connected. More likely, it’s that he managed to acquire it.
So, add a safety margin of about 20k. That leaves 380k for the shell construction including the garage. Then add the 20-22% markup, so roughly 80-100k.
That’s something different from a bargain. But what else can you do other than say: No, it’s too expensive for me?
Spunk schrieb:
Hmm, sounds reasonable so far.
However, in my opinion, you still forgot some additional construction costs. Utility connections, disposal of basement excavation material—are those included separately?
The plot doesn’t necessarily have to have been cheaper just because the architect is well connected. More likely that he managed to get it.
So, add a safety margin of 20,000 (about 22,000) to your calculation. That leaves 380,000 (about 418,000) for the shell construction including the garage. Then add the 20-22% margin, so roughly 80,000 to 100,000 (about 88,000 to 110,000).
That’s a different level from a bargain. But what else can you do except say: No, it’s too expensive? He still means only the extended shell construction with 400,000 (about 440,000). The interior finishing is not included, correct?
Spunk schrieb:
However, in my opinion, you forgot some additional construction costs. Utility connections, removal of basement excavation — or is that separate? The removal of basement excavation is included (at least I hope so…), utility connection costs are the only ones explicitly defined as owner’s responsibility and will be billed directly by the supplier — how much should I expect to pay for that?
Spunk schrieb:
That’s not exactly a bargain. But what else can you do besides saying: No, it’s too expensive. My problem is the lack of available land plots to freely choose from. However, the architect’s designs are already very good and I like his houses…
My general impression so far: building companies usually quote relatively low prices. With architects, significantly higher price ranges are quickly estimated…
Bau_dus schrieb:
Construction companies generally quote relatively low prices. With architects, the estimated costs quickly rise to significantly higher ranges...I wouldn’t agree with that. I’m managing the construction trades individually and have planned with an architect.
Therefore, I’m quite familiar with the prices in our region. A general contractor would, of course, be able to compete here with a standard floor plan, but not otherwise.
Utility connections start at 7,000–8,000 euros (approximately 7,800–8,900 USD) without gas (+3,000–4,000 euros / 3,300–4,400 USD), and then increase depending on the connection length.
Zaba12 schrieb:
He still means only the extended shell construction with 400k€. The finishing work is not included, right? Yes, that's correct.
Construction costs are not really my area; I’m more familiar with financing and valuation.
But if I understand correctly, the architect/developer is advancing the cost for the land, additional expenses, and demolition. The roughly 750k also needs to be financed with interest.
And with a margin of 80k to 100k, there isn’t much left after ongoing costs, income taxes, insurance, and reserves.
Yes, that impression is often correct. Now you are paying a lot for everything, and you would equip the house with electrical installations worth only €6,000 (about $6,600)? You see what I mean, right? €10,000 (about $11,000) for the garden? That won’t be enough! Plan for €30,000 to €70,000 (about $33,000 to $77,000).
It’s the same with the other items except for the windows.
A shell construction costing €150,000 (about $165,000) already includes a profit margin for the developer. In my opinion, they are making a good profit, and I would stay out of it.
The house with land will cost you around one million euros (about one million US dollars) by the time it is finished, including the garden, kitchen, furnishings, and so on.
It’s the same with the other items except for the windows.
A shell construction costing €150,000 (about $165,000) already includes a profit margin for the developer. In my opinion, they are making a good profit, and I would stay out of it.
The house with land will cost you around one million euros (about one million US dollars) by the time it is finished, including the garden, kitchen, furnishings, and so on.
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