Hello everyone,
We are planning to buy a property within the city area of Munich and are now facing the question of whether we should purchase the property from a developer or take on the role of the builder ourselves. We are looking for a townhouse with a garden area, about 130–150 m² (1400–1600 sq ft) of living space.
In most cases, already planned projects are offered where a design firm, architect, and construction company are already involved.
The costs of construction companies are relatively easy to compare, but the expenses for planning efforts and architectural services are difficult to understand.
Prices vary between 7,000€ and 24,000€ for planning, architectural services, and permits.
What prices are realistic for the following services?
- Preliminary and design planning
- Building permits / planning permission
- Land subdivision, surveying, and site plan
- Felling permits and tree surveys
What hidden costs can arise from contracts with planning and architectural offices during the construction phase?
The common statement is usually that you don’t have to worry about anything anymore.
I would really appreciate your feedback. I will keep you updated as soon as I have had the next discussions.
Best regards,
M.
We are planning to buy a property within the city area of Munich and are now facing the question of whether we should purchase the property from a developer or take on the role of the builder ourselves. We are looking for a townhouse with a garden area, about 130–150 m² (1400–1600 sq ft) of living space.
In most cases, already planned projects are offered where a design firm, architect, and construction company are already involved.
The costs of construction companies are relatively easy to compare, but the expenses for planning efforts and architectural services are difficult to understand.
Prices vary between 7,000€ and 24,000€ for planning, architectural services, and permits.
What prices are realistic for the following services?
- Preliminary and design planning
- Building permits / planning permission
- Land subdivision, surveying, and site plan
- Felling permits and tree surveys
What hidden costs can arise from contracts with planning and architectural offices during the construction phase?
The common statement is usually that you don’t have to worry about anything anymore.
I would really appreciate your feedback. I will keep you updated as soon as I have had the next discussions.
Best regards,
M.
B
Bauexperte16 Oct 2010 16:53Hello,
- From the initial project assessment to obtaining the building permit/planning permission: 25-30% of the applicable construction costs
- Plot division, surveying, and site plan – these tasks are usually carried out by a surveying office appointed by the client – €2,800 to €3,500, depending on the state and region
- Tree removal permits and tree inventory plans – vary greatly at the local level – starting from €150
https://www.hausbau-forum.de/ratgeber/bauherrenhilfe.422/bauherrenhilfe-vor-vertragsabschluss.424/
Best regards
M.Muc schrieb:
...What are realistic prices for the following services?
- From the initial project assessment to obtaining the building permit/planning permission: 25-30% of the applicable construction costs
- Plot division, surveying, and site plan – these tasks are usually carried out by a surveying office appointed by the client – €2,800 to €3,500, depending on the state and region
- Tree removal permits and tree inventory plans – vary greatly at the local level – starting from €150
M.Muc schrieb:
...What hidden costs can arise in contracts with planning and architectural offices during the construction phase?
https://www.hausbau-forum.de/ratgeber/bauherrenhilfe.422/bauherrenhilfe-vor-vertragsabschluss.424/
Best regards
H
Hans_Meier25 Oct 2010 19:11A rate of 25-30% for preliminary planning is set very high. According to HOAI, for a semi-detached house you usually need just under 10,000 EUR.
- Costs for subdivision and surveying are, in my experience, also around 3,000 to 3,500 EUR.
Unfortunately, there are companies in Munich that broker demolition, subdivision, and surveying contracts and then charge double the amount ******.
- Experience shows demolition of a single-family house plus clearing of 500 sqm (5,380 sq ft) of land plus disposal costs around 20,000 EUR.
- Office for land use regulation: max. 500 EUR.
- Creating a tree inventory plan costs a few hundred EUR.
- Tree felling permits related to the building permit/planning permission cost nothing if you carry out compensatory planting.
- Project planning: This is where the most profit is made! Be careful!! There should be legal regulations limiting how much can be charged here. I have seen project planning fees of 25,000 EUR per party, i.e., 50,000 EUR total. This is an extreme imbalance compared to the actual value of the project planning work, which might only be worth about a tenth of that amount.
Those who have the opportunity to acquire the land themselves (possibly through a real estate agent) are better off by:
- commissioning subdivision and surveying separately
- finding their own construction partners
- arranging demolition themselves
- project planning is not really needed anyway, as the architect usually takes care of this in connection with the preliminary design/planning application.
This way, you can easily save 20,000 to 30,000 EUR!
Especially in Munich, this whole area is a tough shark tank where everyone tries to get their hand out and overcharge the client. In the end, you pay the real estate agent, the project planner, and a broker for the preparatory construction work (demolition, surveying, subdivision...), none of whom were actually necessary!
You can then put that money to good use on the actual building.
Because then the real point comes:
Finding a good construction company, general contractor, or main contractor.
Or having a very good architect on your side who can handle the tendering process and oversee it accordingly.
Also important:
You need to understand what the following terms mean, as they refer to very different things:
- Construction company
- General contractor
- Main contractor
- Developer
- Costs for subdivision and surveying are, in my experience, also around 3,000 to 3,500 EUR.
Unfortunately, there are companies in Munich that broker demolition, subdivision, and surveying contracts and then charge double the amount ******.
- Experience shows demolition of a single-family house plus clearing of 500 sqm (5,380 sq ft) of land plus disposal costs around 20,000 EUR.
- Office for land use regulation: max. 500 EUR.
- Creating a tree inventory plan costs a few hundred EUR.
- Tree felling permits related to the building permit/planning permission cost nothing if you carry out compensatory planting.
- Project planning: This is where the most profit is made! Be careful!! There should be legal regulations limiting how much can be charged here. I have seen project planning fees of 25,000 EUR per party, i.e., 50,000 EUR total. This is an extreme imbalance compared to the actual value of the project planning work, which might only be worth about a tenth of that amount.
Those who have the opportunity to acquire the land themselves (possibly through a real estate agent) are better off by:
- commissioning subdivision and surveying separately
- finding their own construction partners
- arranging demolition themselves
- project planning is not really needed anyway, as the architect usually takes care of this in connection with the preliminary design/planning application.
This way, you can easily save 20,000 to 30,000 EUR!
Especially in Munich, this whole area is a tough shark tank where everyone tries to get their hand out and overcharge the client. In the end, you pay the real estate agent, the project planner, and a broker for the preparatory construction work (demolition, surveying, subdivision...), none of whom were actually necessary!
You can then put that money to good use on the actual building.
Because then the real point comes:
Finding a good construction company, general contractor, or main contractor.
Or having a very good architect on your side who can handle the tendering process and oversee it accordingly.
Also important:
You need to understand what the following terms mean, as they refer to very different things:
- Construction company
- General contractor
- Main contractor
- Developer
B
Bauexperte27 Oct 2010 10:39Hello,
For your information: permit planning also includes the preliminary investigation, preliminary design, and design planning – so my statements regarding this were correct. If you look at the current fee schedule, the mentioned values are reflected, divided into fee zones I to V.
The amount you mentioned can therefore only refer to an isolated service according to HOAI and a standard house, where not even a single wall may be moved. That was not the question posed by the original poster. I therefore consider your statement to be more than questionable, especially since architects are subject to heavy penalties if they charge less than the minimum rates according to HOAI.
You must certainly be working just for passion?
As mentioned before, it is not possible to demand "arbitrary" amounts, since HOAI sets both minimum and maximum limits, which are enforced by our courts in legal disputes and are subject to harsh penalties. Note: If you don’t know any better, just remember… (D. Nuhr)
My grandmother used to say that a person only thinks as poorly of others as they think of themselves…
…who will, of course, also bill according to HOAI. The question is whether the architect can calculate costs so precisely that it results in a guaranteed fixed price. If not, any savings you anticipated will quickly disappear—and definitely not because the architect overused the fee schedule.
Best regards
Hans_Meier schrieb:
25-30% is a very high estimate for the permit planning phase. According to HOAI, a semi-detached house usually costs just under 10,000 EUR.
For your information: permit planning also includes the preliminary investigation, preliminary design, and design planning – so my statements regarding this were correct. If you look at the current fee schedule, the mentioned values are reflected, divided into fee zones I to V.
The amount you mentioned can therefore only refer to an isolated service according to HOAI and a standard house, where not even a single wall may be moved. That was not the question posed by the original poster. I therefore consider your statement to be more than questionable, especially since architects are subject to heavy penalties if they charge less than the minimum rates according to HOAI.
Hans_Meier schrieb:
- Project management: This is where the most money is made! Watch out!! There should be legal regulations to prevent arbitrary charging. I have seen project management fees of 25,000 EUR per party, so 50,000 EUR in total. This is a severe disproportion compared to the actual project management work, which might be worth only a tenth of that sum.
You must certainly be working just for passion?
As mentioned before, it is not possible to demand "arbitrary" amounts, since HOAI sets both minimum and maximum limits, which are enforced by our courts in legal disputes and are subject to harsh penalties. Note: If you don’t know any better, just remember… (D. Nuhr)
Hans_Meier schrieb:
Especially in Munich, it’s a real shark tank where everyone tries to stick their hand out and rip off the builders. In the end, you pay the real estate agent, the project manager, and an intermediary for the preparatory construction work (demolition, surveying, subdivision...). But none of these three were actually necessary!
My grandmother used to say that a person only thinks as poorly of others as they think of themselves…
Hans_Meier schrieb:
…or have a really good architect on your side who does the tendering and supervises it accordingly.
…who will, of course, also bill according to HOAI. The question is whether the architect can calculate costs so precisely that it results in a guaranteed fixed price. If not, any savings you anticipated will quickly disappear—and definitely not because the architect overused the fee schedule.
Best regards
H
Hans_Meier27 Oct 2010 23:34Hello building expert,
I am happy to believe that you are honest, professional, and informative.
Unfortunately, you don’t seem to be familiar with the Munich real estate market. It’s truly unbelievable what goes on here.
Of course, there is a huge imbalance between a very limited supply and enormous demand. This not only drives land prices to unexpected heights.
Additionally, the following happens regularly, which I can personally confirm and have experienced multiple times firsthand:
A plot of land is for sale. Immediately, not just one but a whole group of real estate agents rush in. There is no chance to buy it directly from the owner.
As soon as it is listed with one agent, multiple developers jump on it, offering it to customers and collecting reservation fees, sometimes for plots they do not even have access to.
Then they go into planned insolvency or transfer the income to their spouse and declare bankruptcy.
Many homebuyers in Munich have been defrauded using this method this year; only a few have managed to recover their money.
Furthermore, many providers here attract homebuyers with unrealistically low construction costs in building contracts or development agreements. This is a typical pattern here.
In one project development, I was even presented with a payment schedule requiring 10% of the total sum at contract signing and 40% at the start of excavation! 50% of the construction cost before even a hole is dug!
Should I send you the contract? I still have it here!
Of course, there are also reputable providers, but 50% of the offers in Munich are unreliable, unfortunately! It is really sad that things are the way they are.
I know the situation is very different in many other regions. But unfortunately, in Munich, homebuyers face great difficulties due to the extremely unbalanced market.
I just want to open people’s eyes and warn some before their personal misfortune.
But everyone can do with this information what they want.
I have no desire to fight against windmills either…
I am happy to believe that you are honest, professional, and informative.
Unfortunately, you don’t seem to be familiar with the Munich real estate market. It’s truly unbelievable what goes on here.
Of course, there is a huge imbalance between a very limited supply and enormous demand. This not only drives land prices to unexpected heights.
Additionally, the following happens regularly, which I can personally confirm and have experienced multiple times firsthand:
A plot of land is for sale. Immediately, not just one but a whole group of real estate agents rush in. There is no chance to buy it directly from the owner.
As soon as it is listed with one agent, multiple developers jump on it, offering it to customers and collecting reservation fees, sometimes for plots they do not even have access to.
Then they go into planned insolvency or transfer the income to their spouse and declare bankruptcy.
Many homebuyers in Munich have been defrauded using this method this year; only a few have managed to recover their money.
Furthermore, many providers here attract homebuyers with unrealistically low construction costs in building contracts or development agreements. This is a typical pattern here.
In one project development, I was even presented with a payment schedule requiring 10% of the total sum at contract signing and 40% at the start of excavation! 50% of the construction cost before even a hole is dug!
Should I send you the contract? I still have it here!
Of course, there are also reputable providers, but 50% of the offers in Munich are unreliable, unfortunately! It is really sad that things are the way they are.
I know the situation is very different in many other regions. But unfortunately, in Munich, homebuyers face great difficulties due to the extremely unbalanced market.
I just want to open people’s eyes and warn some before their personal misfortune.
But everyone can do with this information what they want.
I have no desire to fight against windmills either…
B
Bauexperte28 Oct 2010 11:15Hello Hans,
I’ll start from the end this time:
I have been doing that for years, and sometimes I lose the motivation, you can believe me. BUT – unfortunately, a new naive person wakes up every day….
Regarding the Bavarian market, I fully agree with you. However – and it seems you may be overlooking this in your understandable frustration – people everywhere are equally good and bad.
What you describe in the rest of your post can be seen equally in Berlin, Dresden, Frankfurt, or Cologne – in short, in all major cities. The core problem here and elsewhere is initially the landowner who confuses quantity with quality and thereby opens the door wide to schemes like the ones you mentioned – AND also the potential buyer who willingly plays along. If, for example, even a small portion of buyers would seek professional advice _before_ signing a reservation fee agreement, inflated construction contracts, etc., the world would look a bit tougher for the “rip-off artists” here as well as elsewhere. But that advice is rarely free, and for the price of advice, you could buy some, presumably, "better" tiles….
Nowadays, it is also no longer easy to set aside capital below a preliminary agreement (EV) or even during insolvency. Towards the end of the discharge phase in insolvency, all creditors are asked again – believe me, if there is even the slightest doubt and the creditors can credibly demonstrate it, the debt discharge is off the table. You must not forget one thing – even if it was possible to set aside capital – everyone wants to play again… and above all, to show the capital.
I believe you – I know these kinds of contracts as well – these are mostly developer deals where the potential buyer unknowingly bears the developer’s financing costs. BUT – you did not sign. If more people before purchase took their eyes off the euro signs, the number of “bad actors” would noticeably decrease!
It’s no different in the Rhineland or elsewhere, and believe me, a large majority of potential homeowners are not blameless in this: a deal can only happen when both sides fit together! And because things are as they are, and thanks to Mother Nature, many of my reputable colleagues and I constantly fight against this one-sided view of our industry, we still manage to count satisfied homeowners among our clients.
I will never be able to protect people who only look for the cheapest offer from harm. But I can – through my voluntary work here – try to encourage some potential homeowners to rethink in time. No question, not every interested party will sign a contract with me – the range of honest competitors’ offers is too diverse – but at least they won’t fall for a cheap provider or rip-off artist if I get the chance to prevent this. However, as above, both sides have to fit together.
Kind regards
I’ll start from the end this time:
Hans_Meier schrieb:
I don’t feel like fighting against windmill blades either...
I have been doing that for years, and sometimes I lose the motivation, you can believe me. BUT – unfortunately, a new naive person wakes up every day….
Hans_Meier schrieb:
…Unfortunately, you probably don’t know the Munich real estate market. It is really unbelievable what goes on here.
Regarding the Bavarian market, I fully agree with you. However – and it seems you may be overlooking this in your understandable frustration – people everywhere are equally good and bad.
What you describe in the rest of your post can be seen equally in Berlin, Dresden, Frankfurt, or Cologne – in short, in all major cities. The core problem here and elsewhere is initially the landowner who confuses quantity with quality and thereby opens the door wide to schemes like the ones you mentioned – AND also the potential buyer who willingly plays along. If, for example, even a small portion of buyers would seek professional advice _before_ signing a reservation fee agreement, inflated construction contracts, etc., the world would look a bit tougher for the “rip-off artists” here as well as elsewhere. But that advice is rarely free, and for the price of advice, you could buy some, presumably, "better" tiles….
Nowadays, it is also no longer easy to set aside capital below a preliminary agreement (EV) or even during insolvency. Towards the end of the discharge phase in insolvency, all creditors are asked again – believe me, if there is even the slightest doubt and the creditors can credibly demonstrate it, the debt discharge is off the table. You must not forget one thing – even if it was possible to set aside capital – everyone wants to play again… and above all, to show the capital.
Hans_Meier schrieb:
During the planning phase of a project, I was even presented with a payment schedule where 10% of the sum would be due at contract signing and 40% at the start of earthworks! That’s 50% of the construction sum before I even have a hole in the ground!!! Should I send you the contract? I still have it here!
I believe you – I know these kinds of contracts as well – these are mostly developer deals where the potential buyer unknowingly bears the developer’s financing costs. BUT – you did not sign. If more people before purchase took their eyes off the euro signs, the number of “bad actors” would noticeably decrease!
Hans_Meier schrieb:
Sure, there are also reputable providers, but 50% of the offers in Munich are rotten, unfortunately! It’s really very sad that things are the way they are.
It’s no different in the Rhineland or elsewhere, and believe me, a large majority of potential homeowners are not blameless in this: a deal can only happen when both sides fit together! And because things are as they are, and thanks to Mother Nature, many of my reputable colleagues and I constantly fight against this one-sided view of our industry, we still manage to count satisfied homeowners among our clients.
I will never be able to protect people who only look for the cheapest offer from harm. But I can – through my voluntary work here – try to encourage some potential homeowners to rethink in time. No question, not every interested party will sign a contract with me – the range of honest competitors’ offers is too diverse – but at least they won’t fall for a cheap provider or rip-off artist if I get the chance to prevent this. However, as above, both sides have to fit together.
Kind regards
Similar topics