What is the cost of a prefabricated house?

Are you thinking about realizing your dream of owning your own home and planning to build a house? You have probably already informed yourself about basic questions and made some initial decisions. One of the most fundamental questions when building a house is first of all deciding which construction method you want to choose – solid house or prefabricated house? The number of new prefabricated residential buildings completed in Germany is rising steadily. A significantly larger proportion of people in Germany who want to buy or build a new building prefer the precast construction method to the traditional construction method.

Not only the cost factor often plays a major role in the decision for a prefabricated house. But even if there are many other reasons that speak for a prefabricated house, the question of cost is quite decisive and decisive for many builders. Prefabricated house providers often offer complete houses at a fixed price. But builders should not rely on these prices to actually cover the entire cost of building a home. In addition to just the cost of the house, there are several other factors to consider.

More and more builders are now opting for a prefabricated house and for good reasons!

So if you have decided to realize your own home as a new building in prefabricated construction, you are now surely asking yourself: What will my planned prefabricated house really cost in the end and what are the major cost points to consider?

We know that the price is often the most important question for you as a builder to clarify, before intensive construction planning. We want to answer this question for you and have summarized an overview of the most important information and points for you to consider.

Basically, the price of a prefabricated house depends on numerous determining factors and is as individual for each house as each building family.

To set a benchmark for the price of any prefabricated house is almost impossible and would mislead many builders. Therefore, we try to give you an overview of the most crucial factors that can influence the final construction price. This will give you an overview of what costs you can expect for your individual dream home.

In addition to the price of the actual house construction, there are several other cost factors to consider that contribute to the final total price. The biggest factors that should be considered when planning a budget are:

1. What is the straight house price?
2. What are the ancillary construction costs?
3. How much does the property cost?
4. What are the costs for the outdoor facility?

What is the straight house price?

In most cases, the largest portion of the total cost is the house-only price. As a guideline for its share is considered about 35-60%, depending on the planned prefabricated house. At the same time, this is a control lever that builders can greatly influence with individual decisions.

For the sheer cost of construction, builders should expect a price of about 700 to 2500 euros per square meter. On average, builders pay about 1800 euros per square meter for the construction of their own home in prefabricated construction. These values obviously leave a lot of leeway for the final price per square meter. We would like to explain to you as clearly as possible what this depends on and how this large price range arises. The most important factors that we would like to examine in more detail are:

How much do different types of houses cost?

From a simple, one-story bungalow, to a traditional country house, to a professional architect’s home, there are no limits to your individual ideas here. Accordingly, the cost also varies greatly depending on the type of house chosen. Also the decision whether your dream house should be planned as a single family house, semi-detached house or terraced house has a great impact on the final building price. By far the most popular dream home for Germans is still a single-family home. But the bungalow also enjoys relatively great popularity. Rough guide values in € per square meter, to which they can adhere here are:

Please note that these are only approximate values, which can vary significantly depending on many other factors.

What influence does the size of the house have?

It is obvious that the size of your planned house can significantly influence the total price. If one considers the above-mentioned reference value of up to more than 2500 euros per additional square meter, it becomes clear that an increase or decrease in living space of only a few square meters can already have a considerable influence on the final total price of a house. Therefore, here, especially if the budget is limited, it is necessary to realistically determine its real needs for space and stick to it when building a house. In this way, you can already avoid the first additional costs that are not absolutely necessary.

Which expansion stage is suitable?

One of the biggest factors influencing the pure construction price of a prefabricated house is its finishing level. The stage of completion defines the degree to which a house has already been completed at the time of acceptance and which work the building owners still have to carry out themselves before moving in. The more personal contribution you as a builder make to your own home, the lower the price you have to pay to the developer for his work. This price difference can reduce the price of the house up to more than one third. We distinguish here, ascending according to the degree of completion, between ready-to-build, ready-to-engineer and turnkey houses, whereby it should be noted that ready-to-build houses are really only suitable for builders who have great craftsmanship and experience.

As a guideline, for the price differences of the various stages of development, you can save about 18% of the construction price for a ready-to-use house and about 35% of the construction price for a ready-to-expand prefabricated house, compared to a turnkey house. However, it is important to note that you can save money on houses with a lower production level, but you will also have to spend considerably more time on doing the work yourself. However, the meaning of the individual expansion stages is not clearly defined; each manufacturer can interpret them differently. Therefore, always ask exactly which specific services are included in the price for the selected expansion level. Neither “turnkey” nor “ready to expand” are legally protected terms. The common definition of different expansion stages for prefabricated houses is therefore only an orientation.

Prefabricated houses ready for finishing

Prefabricated houses ready for finishing are characterized by a low level of production. Here, builders have to do a large proportion of the work themselves. Accordingly, the house price that must be estimated. In return, builders have to spend a lot of time and skill to do a lot of the work themselves. In the case of ready-to-build houses, the construction family, in principle, takes care of all the interior work itself. At the time of acceptance, usually only the basic framework of the house, i.e. the shell, with foundation, masonry, exterior walls and the facade, as well as ceilings, stairs and the framework of the roof are completed. The work that the construction family undertakes itself in the case of a house ready for finishing accounts for approximately 75% of the total construction activities. If you choose a ready-to-build-out house, it is important to bear in mind that the total cost of the construction project can hardly be planned in advance and can rise to unexpected heights due to individual mistakes. Therefore, this stage of expansion is recommended only for builders who are very skilled craftsmen and can largely avoid major mistakes when working on their own.

Prefabricated houses ready for technology

In a house ready for technology, all the building equipment is installed ready. On the one hand, this saves the builder a lot of work, and on the other hand, a house that is ready for technology also requires significantly less craftsmanship on the part of the builder. In the case of ready-to-engineer houses, construction companies do about half of the construction work, and the rest is done by the construction family itself.

This can save some of the often considerable labor costs involved in interior construction. But here, too, it should be noted that individual errors in independent activities can ultimately make the engineered house more expensive than originally planned.

Turnkey prefabricated houses

In a turnkey house, all the activities of building a house are carried out by a professional construction company. The builder himself, therefore, does not have to do any work himself. Accordingly, you have to budget more if you opt for this expansion stage. However, the turnkey house also has a positive aspect on the cost side: the costs are usually higher, but can also be calculated with greater certainty in advance. Accordingly, the turnkey stage is suitable for builders who can spend as little time as possible on the construction of the house, are laymen and generally want as little risk as possible in the construction of the house. Of course, the corresponding financial resources must be available to the developer for the desire to build a turnkey house.

What is the impact of the construction region?

The location in which you want to build your house is decisive for the total price of your building project, not only because of the very different land prices throughout the country. Also the pure building price of your own home can differ extremely regionally throughout Germany. Up to one-third of the cost can be saved just by choosing a different region to live in. In general, there is a clear disparity in pure construction prices between northern and southern Germany, which is partly due to extremely divergent costs for labor. The gross wages of employees in all sectors in Germany differ, in some cases extremely. The average labor costs per employee hour in Western Germany are over €15 higher than those in Eastern Germany. This is also the case, of course, in the construction industry and in the skilled trades. Accordingly, depending on your building region, higher or lower costs will be incurred for tradesmen’s labor hours during your home construction. Regions with relatively low labor costs are often found in eastern Germany, while workers in metropolitan areas such as large cities and especially in southern Germany are usually paid more.

What are the ancillary construction costs?

In addition to the actual pure construction costs, the ancillary construction costs are by no means to be neglected when building a house. On average, these can account for up to 20% of the total price and should therefore be included in the financial planning from the outset. Incidental construction costs are incurred for the land, for the construction site and also during the construction of the house.

Some examples of the most important factors for ancillary construction costs are brokerage and notary fees, taxes such as land transfer tax, development costs.

How much should be budgeted for incidental construction costs depends on the individual situation, but a guideline can be identified: 15% for incidental costs is common, but it is not uncommon to plan for up to 20% of the total cost of building a house.

How much does the property cost?

A very large cost of building a house comes from the purchase of a suitable plot of land. It is extremely difficult to define a reliable benchmark, especially for prices of building land. Hardly any other thing fluctuates regionally in price as extremely as land prices. Land prices start at around €20 per square meter in Saxony-Anhalt, but can also rise to €2,500 per square meter in Munich, for example. Obviously, it is difficult to give a universally valid benchmark for land prices. However, the average price per square meter of building land in Germany is around €180. Thus, there is a relatively large range of 25-55% of the total construction cost that you should factor in for the appropriate building site.

Price of land ready for construction in Germany by federal state in 2019 (in euros per square meter)

What are the costs for the outdoor facility?

Another major cost you should not forget in your financial planning is the cost of the desired outdoor facility. A guideline for this is approximately 5% of the total cost of your construction project. These costs include all work that needs to be done outside the house, such as work in the garden, on the terrace or the garage. Think carefully about which of these additions you need or want to afford, and consider less expensive alternatives such as a carport instead of a garage. Indeed, the construction of a garage may well exceed 5 times the cost of a carport. Gardening work is also often an activity where additional costs can be saved, since it can be done by the owner himself, even for less experienced builders.

Conclusion

To get a ballpark figure of what budget you should plan for your home construction, you should consider the cost drivers discussed above.

Think about which class of house you want and in which stage of completion you want to purchase the house – in other words, how much of your own work you want to or can do yourself. You should also have defined the square footage your home will require in order to reliably estimate rough costs.

The product of these factors forms a good guide to the pure cost of the house.

To get an overview of the land prices in your desired residential area, you can use this table. Of course, prices in metropolitan areas and large cities may well exceed the average for an individual state by a considerable margin. Depending on how large you want your land area to be, this will determine the land costs that you should factor in.

In addition, you should calculate about 15% for ancillary construction costs and another 5% for your outdoor facilities. With these estimates, you can get a good overview of the costs that you will incur when you plan to build a house.

To get a detailed overview of the expected costs for your individual dream house, you can use our free prefabricated house calculator.

Autorin Sarah Völkl

Sarah Völkl hat Architektur studiert und ist seit Jahren das Gesicht von a better place. Mit ihren Videos ist sie bei YouTube vielen Personen schon länger bekannt. Sarah teilt Ihr Wissen jetzt auch bei den Bautipps von Almondia.