Whether you are constructing your home or a commercial building, you need to plan adequately. More importantly, you should have a precise estimate of the expected project cost. However, determining such a value isn’t an easy job. Every single item, no matter how small it is, should be included in the estimated cost. Even the tiny bolts and nuts matter a lot.
It is advisable to partner with a professional estimator, such as CostCertified, to help you get accurate estimates. This article will also enable you to understand more about construction estimates.
Definition of Construction Estimates
A construction estimate is a forecast of the cost expected to be incurred in a construction project. You can use the estimate to determine the feasibility and scope of the project if you are the owner.
Contractors also use it in bidding for construction tenders. By hiring a professional estimator, you can get accurate forecasts. Typically, the estimator will work hand in hand with your engineers and architects to develop the estimate.
How to Use Construction Estimates
A construction estimate is beneficial to several people in the construction project. The project owner needs an estimate in selecting bids. They will compare the costs of different contractors against their calculations.
Additionally, estimates enable property owners to determine unforeseen expenses as well as the long-term upkeep and maintenance costs. Of course, the forecast helps them to know whether or not the project is achievable based on their budget.
Also, the construction estimate is an essential tool for building contractors. It assists them in getting an accurate picture of all costs involved in the project. It shows them what is available at their disposal and what is in limited supply. As such, they are able to organize the work accordingly. For instance, a contractor may decide to outsource workers or hire them locally based on the labor costs provided on the estimate.
Construction estimates are also important to engineers and architects. They use an estimate to determine the feasibility of the project. It helps them to determine whether the construction price indicated in the forecast is truly practical.
Is it sufficient to construct the building up to completion? Is the amount enough to pull through the specific design you want? Such questions can be answered using a construction estimate.
Who is Responsible for Construction Estimates?
Various people can do cost estimation in a construction project. As the property owner, you may decide to handle the estimation work owing to the fact that financial matters are quite sensitive. In this case, you’ll need cost estimation software to get the job done. Better yet, you may appoint your engineer or architect to do the work on your behalf.
The best option is to hire an expert estimator. Construction cost estimators have the right expertise and experience to get an accurate estimate for your project. They may require the input of the engineer, contractor, and architect in developing the estimate.
The Number and Types of Estimates in a Construction Project
Typically, each level of a construction project will have a different kind of estimate. In that case, there are five categories of estimates:
Bid estimate – This estimate is issued by contractors at the tender bidding stage.
Order of magnitude estimate – It is developed at the initial stage of the project; usually, before design work begins. It is used to determine the practicability of the project.
Schematic design estimate – This estimate is created at the stage of developing the building design.
Design development estimate – It is a preliminary estimate that is created when the designs have already been established. It may be used to develop budgets.
Construction document estimates – They are usually the ultimate project estimates. They are created when design work and project documentation have been finalized.
There are various ways of developing a construction estimate. You can build your estimate based on:
Building aspects: Here, certain functions of the projects are considered in creating the estimate. These aspects include site work, equipment and furnishings, services, interiors, shell, and substructure.
Cost of elements: In this case, you will calculate the project cost by adding up the production costs, including overheads, labor costs, and material costs.
Physical construction: Here, you take into consideration all the direct and indirect expenses to be incurred in the construction. They include material costs, equipment costs, labor costs, subcontractor costs, and contingencies.
Historical trends: You can adapt previous successful estimates. You may borrow such an estimate from an experienced estimator or contractor.
Things That May Influence a Construction Estimate
Construction projects are not equal. As such, estimates will differ from project to project. Besides the basic project costs, such as labor and material prices, other factors may influence your estimate. One of them is the location of the building site.
If the site is far from the source of materials and workers, you’ll incur high transportation costs. Additionally, the nature of the construction site will fundamentally affect your estimates. For instance, the type of rock and soil, land topography, and the presence of existing buildings may influence time, material, and labor requirements.
Similarly, local rules and regulations can significantly affect the trajectory of a project and its cost. Some construction designs have more stringent rules than others; hence they are likely to be more expensive.
Project timing is yet another estimated influencer. Usually, a rushed project is costly due to expensive insurance charges and other rush charges. On the other hand, a long project is likely to be affected by inflation and market fluctuations. You need to put into consideration all these factors when developing your construction estimate.
Tips on How to Make the Estimating Process Easier
Estimating the cost of a construction project is intensive and detail-oriented. The surest way to have an accurate estimate is to hire a construction cost estimator. Professional estimators have the necessary market knowledge and experience on prevailing construction trends.
These attributes are crucial in producing accurate estimates. Besides that, they will do all the estimation work for you, allowing you to proceed swiftly and successfully in the project.