ᐅ Price Increase Due to Market Conditions

Created on: 16 Sep 2019 20:46
D
Donludo
Hello,

We received an offer from a builder in March. Since then, we have been in ongoing discussions regarding changes to the building specifications, conducting soil surveys, etc.
Now the soil report is available, and the builder is not only increasing the price for the basement but also raising the total price of the house by nearly 10% due to the market situation! That seems quite high to us.
First offer in March, latest revision in July, and now it is mid-September...

What do you think? Counteroffer?
N
nordanney
17 Sep 2019 09:56
Donludo schrieb:

due to the market situation, also the total price of the house by nearly 10%! That seems very high to us.
Normally, it would be between three and five percent. I actually see that with my clients who calculated at the end of 2018 and are now going into contract awarding (but these are "major buyers," as the construction volume is €10 million and up).
N
nightdancer
18 Sep 2019 09:40
Donludo schrieb:

Hello,

We received an offer from a developer in March. Since then, we have been in ongoing discussions regarding changes to the construction specifications, conducting soil surveys, etc.
Now that the soil report is available, the developer is not only increasing the price for the basement but also raising the total house price by nearly 10% due to the current market situation! This seems quite high to us.
First offer was in March, the latest additional offer in July, and now it’s mid-September...

What do you think about this? Should we make a counteroffer?

Well, he also has to factor in the costs of your requested changes. Is it a developer contract or a general contractor? In the end, you can make him a counteroffer or keep looking.
H
HilfeHilfe
18 Sep 2019 10:17
free market economy...
G
goalkeeper
18 Sep 2019 11:24
Each offer has a certain validity period, usually noted at the bottom: "...we are bound by this for x weeks."

So, either talk to your construction company – sometimes their quoting software automatically applies such prices due to a scheduled increase. I consider a 10% increase rather unlikely.

He’s probably not interested in working with you anymore – to put it bluntly.
P
pffreestyler
18 Sep 2019 11:33
I know from my neighbor that, for example, Team Massivhaus also raised all catalog prices by nearly 8% in August 2018. That’s why they signed the contract in July. Either it was smart pressure tactics or the 10% increase isn’t entirely unreasonable. It’s just really frustrating.
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goalkeeper
18 Sep 2019 11:36
And precisely because of tricks like these, I find the big companies in the industry simply unacceptable. But this is not just the case in construction – furniture manufacturers do it too. They try to sell you an upcoming price increase as a discount and also put extra pressure on you.

That’s why I prefer working with a local general contractor and furniture studio. There you only feel a little bit “cheated” and not completely.