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Understanding Building Cost Estimation Process

Learn how to estimate residential building costs using square foot and cubic foot methods. Discover how preliminary and final estimates are generated, along with cost variations and tools like computer software. Explore architecture, green building, entrepreneurship, and methodologies for accurate material, labor, and other cost assessments. Utilize MasterFormat and UniFormat systems to organize estimates effectively.

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Understanding Building Cost Estimation Process

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  1. Chapter 35 Estimating Building Costs

  2. Objectives • Explain the process of estimating the building cost for a residence. • Prepare a preliminary estimate of the cost of a residential structure using the square foot or cubic foot method. • Generate a final estimate for a simple structure.

  3. Introduction • Estimating is an organized effort to determine total cost of materials, labor, and other services required • Made after house has been designed, construction drawings completed, specifications prepared

  4. Preliminary Estimates • Preliminary estimate created at design stage • Estimates probable costs and to place limits • Design contingency indicates how much cost overrun may occur on project • Two manual methods of estimating building costs are square foot method and cubic foot method

  5. Square Foot Method • Estimate based on total area of house • Compute number of square feet in house • Multiply square footage by constant value, determined by local conditions • Garages, porches, basements figured separately, at about one half of living area cost • Square footage determined by multiplying house length by house width

  6. Square Foot Method Example • 24' x 60' house, 20' x 20' garage • Living area 1440 square feet, garage 400 square feet • $100 per square foot building cost for living area • 1440 x $100 = $144,000 • $50 per square foot building cost for garage • 400 x $50 = $20,000 • Total cost: $144,000 + $20,000 = $164,000 • Price of land not included

  7. Cubic Foot Method • Based on volume of house • Volume found by multiplying area by height • Height is distance from floor to ceiling for each level of house including basement • Attic volume included, calculated by multiplying area by 1/2 of rise

  8. Cubic Foot Method Example • 24' x 60' house • Living area 1440 square feet, height 8' • 1440 x 8 = 11,520 cubic feet in living area • Attic area 1440 square feet, rise 4' • 1440 x 2 = 2880 cubic feet in attic • Total volume is 14,400 cubic feet • $10 per square foot building cost for living area • 14,400 x $10 = $144,000 • Total building cost for house, $144,000

  9. Cubic Foot Method Example • 20' x 20' garage • Volume 400 x 8 = 3200 cubic feet • Garage attic rise, 3' feet, 400 x 1.5 = 600 cubic feet • Total garage volume, 3200 + 600 = 3800 cubic feet • $5 per square foot building cost • 3800 x $5 = $19,000 • Total estimated building cost, $144,000 + $19,000 = $163,000 • Price of land not included

  10. Employability • Entrepreneurship • Entrepreneurs are people who start and run their own businesses • Work for themselves, feel a sense of accomplishment, can be financially rewarding • Entrepreneurs do their own work, plus all the work for the business (marketing, accounting) • Do your research before committing to entrepreneurship

  11. Architecture Green • Costs of green building design • Initial building costs for green building are higher than costs for traditional construction • An experienced estimator can help a client build a sustainable home for little more than traditional building costs • Keeping up-to-date on available products, processes, and guidelines allows estimator to provide green solutions that may not increase cost of home

  12. Final Estimates • Preliminary estimates can vary considerably from actual cost • More accurate cost estimate is final estimate, or material takeoff • Created by outside company specializing in estimation

  13. Materials Estimate • Estimator compiles list of materials required • Once listed and priced, total material cost calculated

  14. Labor Estimate • Can range from 60% to 89% of total building costs • Costs vary widely throughout United States • Use publications that provide detailed information regarding labor costs for various areas of country • General contractors and subcontractors can also provide help in projecting costs

  15. Other Costs • Insurance • Fees for permits • Environmental impact fees • Other fees • Once evaluation of costs is complete, total building cost can be calculated • Variations from preliminary estimate may be due to materials price fluctuations, labor overruns

  16. Computer Estimates • Software programs for estimating save time • Floor plan is imported, analyzed, and costs are automatically calculated

  17. Computer Estimates • Estimate for electrical work required on a residential construction project.

  18. Organizing Estimates • Organized according to work breakdown structure (WBS) • Common systems are MasterFormat and UniFormat • UniFormat system more commonly used for preliminary estimates • MasterFormat system used for final estimates

  19. MasterFormat System • Numbered divisions and titles identify construction requirements, products, activities • Not all divisions apply to residential construction • Some divisions reserved for future use • Divisions are organized under groups and subgroups

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