ᐅ Developer requests deposit before starting plans

Hello everyone,

We are currently in the process of planning our house. We already have a clear idea of how we want it to look. We found a great house online with some modifications.
Now we visited a builder who is requesting a deposit of 4,000 EUR. The reason behind this is understandable: they put in the work, and in the worst case, we might take the drawings to another builder.
However, to me, the amount seems quite high! 4,000 EUR is easily at least half a month’s salary for a draftsman. Or am I mistaken in this?

Basically, I would like to have at least two offers to be able to compare prices.

I have contacted another builder who provided me with a first draft over the weekend without any charges.

What do you think? Deposit yes or no? And if yes, how much?

Best regards,
Antonio

In my personal opinion, this is a matter of service. At least the initial draft should not cost anything, in my view. I would basically rule that out right away. We had two appointments each with two different developers, where we were shown and given drafts. Then we compared everything, including the scope of construction services, and proceeded with one of the two. To me, this is part of the sales process. However, I can understand that some may charge a fee after a certain number of revised drafts, but not from the very beginning.

Hello,
I recommend that you first familiarize yourself with the terminology. Do you own a plot of land? Then you don’t need a developer but rather a general contractor or main contractor or building contractor.
If you do not own a plot of land and work with a developer, you will not be able to build with a different company on their land.

We are currently in a seller’s market. You can always try to negotiate prices, but if the supplier has enough demand, there will be someone willing to pay for the planning work—even if that is only necessary for the offer preparation. It is fair that they inform you of this upfront. We also have a case in the forum where the potential buyer was surprised by the bill...

I don't think this is too expensive. But you don't need a detailed, precise drawing to compare prices. In fact, a rough sketch or a modification of a standard house plan will suffice. Even a sketch from the homeowner, if they have some experience, is enough.

I had paid in advance to the general contractor (GC) for my design under a planning contract, and the cost was similar. Afterwards, I had the design priced as a turnkey project by several companies, including this GC.

In my case, however, I received an actual design tailored to my wishes, including several revisions, rather than the usual free GC copy-paste of old designs. If you want more service, you have to be willing to pay for it. But of course, I would also hold the planner fully accountable in that case. And I would only do this with companies that have an excellent reputation...

MM1506zzzz schrieb:

Hello,
I recommend you first familiarize yourself with the terminology. Do you own a plot of land? Then you don’t need a developer but rather a general contractor or main contractor or builder.
If you don’t own land and you go to a developer, you won’t be able to build with another company on their land.

Currently, it is a seller’s market. You can always negotiate prices, but if the provider has enough demand, there will be someone willing to pay for the planning services—even if these are only necessary for preparing the offer. It’s fair that this is clearly disclosed upfront. We also have a case in this forum where the potential builder was surprised by the invoice...

First of all, thank you for your answer.
We actually acquired a plot of land through a city lottery process (Bobingen near Augsburg).

We want to build a turnkey house, so we approached developers.

Depending on the effort involved, it is understandable to pay a deposit. But 4,000 EUR (about 4,400 USD)? For work that could possibly be completed within 8 hours of labor?!
The deposit would, however, be credited towards the construction contract...