ᐅ Would you choose to build your own house again or go with a developer?
Created on: 7 Dec 2021 16:19
N
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.
I believe it’s like with many things. If a person is satisfied with their decision, then that is naturally the ultimate outcome. Whether it’s the type of house construction, the kitchen appliance, etc. If you end up with a faulty product or problems with the general contractor, architect, or developer, it often leads to saying "never again like this!" However, this is usually purely subjective and based on one experience being generalized to a fundamental level. And is renovating an existing building, for example, necessarily better? Pitfalls can also be lurking there.
H
hampshire8 Dec 2021 08:04Ysop*** schrieb:
I think this is like many things. If a person is satisfied with their decision, then of course that is the ultimate. Ysop*** schrieb:
But this is mostly purely subjective and often based on one experience generalized to a principle. And whether renovating an existing building, for example, is better? There can be pitfalls there as well. What stresses people or makes them satisfied can vary greatly. This is a very important and not easily transferable key factor in the decision-making process.
Those who focus on “pitfalls” and are safety-oriented benefit from different approaches than those who have no fear of mistakes or even failure. And this is only one of many aspects.
Generalizing a “better” or “worse” path to homeownership is obviously nonsense, within which polarizing and teasing can sometimes be quite fun (though not for everyone).
Ysop*** schrieb:
I believe it’s like with many things: if someone is satisfied with their decision, then that’s naturally the best possible outcome. Whether it’s the type of house construction, the kitchen appliance, etc. If you end up with a defective product or problems with the general contractor, architect, or developer, it often leads to the feeling of "never again like this!". But that is usually purely subjective, or a single experience is generalized. And is renovating an existing building, for example, actually better? That is true, but one thing is fundamentally different between hiring subcontractors individually and building with a general contractor (GC): The trades work for you. If you’re not satisfied with a particular trade or you’re having difficulties reaching an agreement, you can replace them—setting aside the current tight availability situation. With a GC, the trades work for the GC. Ultimately, they are accountable to the GC, not to you. This can be an advantage later on when it comes to warranty issues because you have only one contact responsible to you, but during the construction phase being completely dependent on a single partner can be difficult or even unbearable for some.A developer, on the other hand, is suitable for those who don’t want to deal with anything during the building phase, or who simply have no interest in engaging with these issues. For people who consider being limited to five different tile and grout color options at the sales office a blessing.
So, a general recommendation can be made to some extent depending on the buyer’s type. But, of course, the details always matter.
A
Alessandro8 Dec 2021 09:42For me, the main advantage of using a general contractor (GC) is that you have ONE point of contact, and the specialized subcontractors know each other well from years of working together and understand what each party values.
Most of these are local companies, which is convenient as I can easily reach out to them if needed.
I don’t have these advantages with hiring individual contractors, and it’s also questionable whether that would be cheaper.
Our GC retained the usual discount (sconto) from each trade for coordination work, which typically ranges between 2-3%.
Most of these are local companies, which is convenient as I can easily reach out to them if needed.
I don’t have these advantages with hiring individual contractors, and it’s also questionable whether that would be cheaper.
Our GC retained the usual discount (sconto) from each trade for coordination work, which typically ranges between 2-3%.
Alessandro schrieb:
For me, the general contractor (GC) clearly has the advantage of having a SINGLE point of contact, and the specialist subcontractors know each other well from years of working together and understand what each values.
Most of them are also local companies, so I can quickly reach out if something comes up.
I don’t have these advantages with individual contracting, and it’s also questionable whether it would actually be cheaper...
Our GC retained the respective discount (skonto) from each trade for coordination work, which usually ranges between 2-3%. In our case, the GC offers us a 1% discount (skonto), which amounts to over €3,000 (about $3,200). Of course, it’s unclear if this was factored into the price beforehand.
Regarding regional subcontractors, that usually only applies to smaller GCs. The larger ones often have subcontractors from other states or even abroad, which isn’t necessarily a disadvantage.
We built with a small general contractor, and after reading some of the reports here, we realize we were lucky because this contractor built our house with relatively little stress. A building savings contract representative was regularly on site and confirmed the quality of the house. Minor corrections were carried out immediately, and small issues did not turn into major problems 😉 The contractor was recommended to us by the brick manufacturer, who had a small regional positive list of general contractors.
Similar topics