ᐅ Would you choose to build your own house again or go with a developer?
Created on: 7 Dec 2021 16:19
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NeuerBauherrHE
Hello everyone,
Due to an early inheritance, we were able to buy a plot of land in Frankfurt relatively cheaply for €140,000 (about $150,000). Our general contractor (GC) estimated the house construction costs at €450,000 (about $485,000) back in 2020. With some contingency, we arranged the financing based on that.
Now that the shell construction phase has started, we are already €40,000 (about $43,000) over the original estimate. Given current prices, the additional costs will likely be around €80,000 to €90,000 (about $86,000 to $97,000), especially after adding the landscaping and utility connections (electricity, water). We will probably have to apply for additional financing. Unfortunately, none of our acquaintances have built with a GC; they only know about building from property developers.
The total cost of the house build will then be around €700,000 (about $755,000). Our own funds were €200,000 (about $215,000).
I know that building here in Frankfurt is relatively affordable since new builds generally start at €1 million (about $1.08 million), but our initial mortgage repayment was planned at €1,300 (about $1,400) and after additional financing it would increase to €1,800 (about $1,940).
With a net household income of €4,000 (about $4,320), this is pushing our limits, especially since my wife is not a civil servant and does not have a secure public-sector job.
I keep wondering if the house build is really worth it, considering that with the mortgage payments I could live comfortably in a larger apartment without being tied down? Plus, the whole stress with the building authority, construction supervision, neighbors, and utility providers, which has forced us to make many compromises during planning.
We actually hired the GC to organize everything, but in the end, we are still the main contact for soil surveys, unexploded ordnance investigations, utility connections, road closures, and even porta-potty arrangements.
Ideally, I would like to sell the house in three years, start over, and buy directly from a property developer. I really have no desire to deal with the stress of being a builder anymore.
Due to an early inheritance, we were able to buy a plot of land in Frankfurt relatively cheaply for €140,000 (about $150,000). Our general contractor (GC) estimated the house construction costs at €450,000 (about $485,000) back in 2020. With some contingency, we arranged the financing based on that.
Now that the shell construction phase has started, we are already €40,000 (about $43,000) over the original estimate. Given current prices, the additional costs will likely be around €80,000 to €90,000 (about $86,000 to $97,000), especially after adding the landscaping and utility connections (electricity, water). We will probably have to apply for additional financing. Unfortunately, none of our acquaintances have built with a GC; they only know about building from property developers.
The total cost of the house build will then be around €700,000 (about $755,000). Our own funds were €200,000 (about $215,000).
I know that building here in Frankfurt is relatively affordable since new builds generally start at €1 million (about $1.08 million), but our initial mortgage repayment was planned at €1,300 (about $1,400) and after additional financing it would increase to €1,800 (about $1,940).
With a net household income of €4,000 (about $4,320), this is pushing our limits, especially since my wife is not a civil servant and does not have a secure public-sector job.
I keep wondering if the house build is really worth it, considering that with the mortgage payments I could live comfortably in a larger apartment without being tied down? Plus, the whole stress with the building authority, construction supervision, neighbors, and utility providers, which has forced us to make many compromises during planning.
We actually hired the GC to organize everything, but in the end, we are still the main contact for soil surveys, unexploded ordnance investigations, utility connections, road closures, and even porta-potty arrangements.
Ideally, I would like to sell the house in three years, start over, and buy directly from a property developer. I really have no desire to deal with the stress of being a builder anymore.
R
RotorMotor7 Dec 2021 16:46NeuerBauherrHE schrieb:
The general contractor only offers a fixed price for the house itself.
Additional construction costs, such as earthworks, landscaping, and utility connections, are no longer part of the general contractor’s responsibility. These costs were initially estimated far too low. Could you please explain in more detail where the 40,000€ or 80,000–90,000€ figures come from?
Of course, earthworks can sometimes be more expensive, but that much?
Utility connections are handled by the municipal utilities, so there shouldn’t be any surprises there.
P
pagoni20207 Dec 2021 16:46RotorMotor schrieb:
With a general contractor, you usually get the full all-inclusive package, except for the land. You rightly included the word "usually" in the sentence. Unfortunately, this does not apply to every general contractor, as I believe there are just as many bad and questionable ones as anywhere else.
B
Benutzer2007 Dec 2021 17:05First of all, to address the question.
Yes, I would build again (I have experience with an existing house without renovation and one with a full renovation). What I definitely cannot imagine is building with a general contractor (GC) or, even worse, with a developer.
Why? I am not comfortable committing too much or handing over control to others. Especially with developers, you almost have to accept whatever comes. Usually, it’s the standard model homes in the development, like the “Gerda” or the “city villa Gudrun.”
I want to keep control of my build, coordinate it myself, be present as the house takes shape, and have the option to implement spontaneous changes. I also enjoy doing some of the work myself.
Lump-sum pricing doesn’t always work either. There are houses built under individual trade contracts that run perfectly in terms of cost and schedule. Or they can end in a disaster. You have the same range of outcomes with a GC or a developer. The forum is full of all kinds of examples.
Yes, I would build again (I have experience with an existing house without renovation and one with a full renovation). What I definitely cannot imagine is building with a general contractor (GC) or, even worse, with a developer.
Why? I am not comfortable committing too much or handing over control to others. Especially with developers, you almost have to accept whatever comes. Usually, it’s the standard model homes in the development, like the “Gerda” or the “city villa Gudrun.”
I want to keep control of my build, coordinate it myself, be present as the house takes shape, and have the option to implement spontaneous changes. I also enjoy doing some of the work myself.
NeuerBauherrHE schrieb:But in the end, this means the house will cost as much as if you had bought it from the developer (where the additional construction costs would have been included in the purchase price). The developer would have properly calculated these costs (sorry, but you have to blame yourselves for these high amounts). The only difference is that you would have known this earlier—before signing the purchase contract.
The GC only offers a fixed price for the house.
Additional construction costs such as earthworks, landscaping, and utility connections are no longer the GC’s responsibility. These costs were set far too low.
Lump-sum pricing doesn’t always work either. There are houses built under individual trade contracts that run perfectly in terms of cost and schedule. Or they can end in a disaster. You have the same range of outcomes with a GC or a developer. The forum is full of all kinds of examples.
NeuerBauherrHE schrieb:
These costs were set far too low.The classic case with the term "by the builder" 😉NeuerBauherrHE schrieb:
Ideally, I would sell the house in 3 years and start over by buying directly from a developer. I really don’t want to deal with the stress of building anymore. You think that now :-) but in 3 years, when you are just starting to really enjoy the new house and the garden is thriving, will you want to face the stress all over again? Never ever 🙂
I believe almost everyone who builds or renovates goes through the “valley of tears.” Some more, some less. But for very few will it be a walk in the park—I honestly don’t know anyone for whom it was. Almost everyone has to make compromises, often because of a limited budget. Keep in mind, the stress will soon be over, and then you will get to enjoy your own home!
I’m sorry to hear that you’re going through such a difficult phase right now.
That sentence caught my attention right away…
Hmm, it seems like you didn’t gather enough information beforehand. When buying a car, people usually research various sources, compare advantages and disadvantages, horsepower, innovations, and where to get the best value. They listen to the dealer but also do their own online research. Some spend even more time and effort researching vacuum cleaners than they do when choosing a GC. Yet when building a house, fewer overall details are collected…
Yes, that sounds about right. If you forget earthworks and most other additional construction costs, then add the kitchen and landscaping…
Honestly, I don’t understand why this is so overwhelming. You’re not describing disasters other people have experienced or are currently going through. Somehow, you do get instructions from the GC like: “this is needed,” or “you still have to take care of this…” There are also a lot of positive things and memorable moments, such as the first groundbreaking, the excavator arriving, the first brooming of the shell structure, or product selections…
Why? Then your frustration and all the difficulties you feel would have been for nothing.
Yes, the household income is too low for this house… but we also don’t know enough details about the house itself. Surely there could have been some options to reduce and adjust costs. The positive side is that income usually rises eventually.
But that would be a totally different lifestyle: you have to grow into the role of a homeowner just as much as into a long-term tenant role. You should reflect on that—maybe with a glass of wine together with your wife—what if… and what would life look like in 10 years? It seems you’re currently unhappy with a house. Instead, I suggest you embrace the idea of peace. Reflect on that and remember your reasons for building in the first place.
I assume you are still quite young?!
Regarding your question:
I would build again, and probably again with a GC. Or an architect. Most likely a GC: during our product selections, we had complete freedom. We didn’t have any unrealistic wishes, and despite occasional stressful moments, we had a positive house-building experience. It’s a long-lasting event with ups and downs. After almost eight years, I’m still proud of our home, even though it has its flaws. And we were very proud homeowners at the time. I wouldn’t want to miss that feeling in my life. If we had bought a developer’s house, it would have been more expensive, since all the additional costs are already factored in. On top of that, we would definitely have paid extra for some special requests. And the property transfer tax would have significantly reduced our budget.
NeuerBauherrHE schrieb:
Our general contractor (GC) estimated the house construction cost at €450,000 in 2020. With a bit of a buffer, we based our financing on that.
That sentence caught my attention right away…
NeuerBauherrHE schrieb:
The GC only offers a fixed price for the house itself. Additional construction-related costs such as earthworks, landscaping, and utility connections are no longer the GC’s responsibility. These costs were estimated far too low.
Hmm, it seems like you didn’t gather enough information beforehand. When buying a car, people usually research various sources, compare advantages and disadvantages, horsepower, innovations, and where to get the best value. They listen to the dealer but also do their own online research. Some spend even more time and effort researching vacuum cleaners than they do when choosing a GC. Yet when building a house, fewer overall details are collected…
NeuerBauherrHE schrieb:
With today’s prices, additional costs will probably be around €80,000 to €90,000, especially once you factor in landscaping and utility network/water connections. We will likely have to apply for additional financing.
Yes, that sounds about right. If you forget earthworks and most other additional construction costs, then add the kitchen and landscaping…
NeuerBauherrHE schrieb:
We actually hired the GC to organize everything, but in the end we are still the primary contacts (soil reports, ordnance clearance, utility network/water connections, road closures, portable toilets).
NeuerBauherrHE schrieb:
On top of that, the whole stress with the building authority, building inspections, neighbors, and utility providers forced us to make many compromises during planning.
Honestly, I don’t understand why this is so overwhelming. You’re not describing disasters other people have experienced or are currently going through. Somehow, you do get instructions from the GC like: “this is needed,” or “you still have to take care of this…” There are also a lot of positive things and memorable moments, such as the first groundbreaking, the excavator arriving, the first brooming of the shell structure, or product selections…
NeuerBauherrHE schrieb:
Honestly, I’d like to sell the house in 3 years and start over, buying directly from a developer. I really have no desire to put up with building stress anymore.
Why? Then your frustration and all the difficulties you feel would have been for nothing.
NeuerBauherrHE schrieb:
With a household net income of €4,000, we’re starting to reach our limits—especially since my wife is not a civil servant.
Yes, the household income is too low for this house… but we also don’t know enough details about the house itself. Surely there could have been some options to reduce and adjust costs. The positive side is that income usually rises eventually.
NeuerBauherrHE schrieb:
Could also live comfortably in a bigger apartment without being tied down to anything?
But that would be a totally different lifestyle: you have to grow into the role of a homeowner just as much as into a long-term tenant role. You should reflect on that—maybe with a glass of wine together with your wife—what if… and what would life look like in 10 years? It seems you’re currently unhappy with a house. Instead, I suggest you embrace the idea of peace. Reflect on that and remember your reasons for building in the first place.
I assume you are still quite young?!
Regarding your question:
I would build again, and probably again with a GC. Or an architect. Most likely a GC: during our product selections, we had complete freedom. We didn’t have any unrealistic wishes, and despite occasional stressful moments, we had a positive house-building experience. It’s a long-lasting event with ups and downs. After almost eight years, I’m still proud of our home, even though it has its flaws. And we were very proud homeowners at the time. I wouldn’t want to miss that feeling in my life. If we had bought a developer’s house, it would have been more expensive, since all the additional costs are already factored in. On top of that, we would definitely have paid extra for some special requests. And the property transfer tax would have significantly reduced our budget.