Controlling Costs

When considering a large renovation/addition project, cost is always a primary concern (and a big stressor). Cost creep/unknown costs are some of the things people most want to avoid. Most people have either had a bad experience, or heard horror stories from friends of remodels turning into nightmares. So how can you make the best of this situation, and come out on budget, scope intact, and with a great end result?
It may seem that going into construction with a simple set of plans, like the permit set is all you will need to build. But many people, especially those on their first remodel go in underestimating the amount of design, planning & communication that are needed to make a project successful. Or they look at design services as a place to cut costs.
Going into a project with basic code complying drawings may be enough to get you permits, but these represent only a small portion of the scope. There often is quite a bit of missing information that will be needed.
This really starts to become a problem during bidding. If we go into a project with Uncertainties, and not enough information, then the less the builder knows about the project scope during the estimating/proposal stage. This open ended situation can result in either inappropriately high, or low bids. The high ones have. The low ones exclude much of the materials & labor that will ultimately be needed for the project. If you have multiple contractors bidding, their bids are not apples to apples. You end up with bids that are either too high, with a lot of buffer room built in; or too low, with lots of exclusions which will manifest as change orders or additional fees. Either way, end costs often end up higher than if you’d gone into pricing with a complete scope.

Industry saying: “If the price seems too good to be true, it is too good to be true”

And there is much less control over the final consistency & quality of the project, as most of the important decisions were either rushed or made on the fly, or made by the contractor without your consent.
If we want to control costs (and quality), two key requirements are:
  1. An accurate prediction of final costs
  2. A clear & comprehensive set of instructions to builders
  3. Thorough vetting of the contractors & their bids.

 

The best way to do this is to consider & account for as many of the steps & materials as possible that will need to go into the project. Some things this includes:

 

  • Accurate & thorough site assessment
    • Geological – foundation red flags?
    • Utilities – need to upgrade?
    • Existing structure – any hidden issues that need to be corrected 
  • Finishes, fixtures should be chosen
    • Tile
    • Flooring
    • Lighting
    • Counters
    • Cabinets
    • Fixtures
    • Hardware
  • Systems & components
    • Space conditioning
    • Electrical
    • Home automation/entertainment
    • Insulation/envelope
    • Windows & doors
  • Design
    • Well vetted options, and a developed design (so wo don’t need to make changes during construction because we didn’t plan well enough)
    • Required features: we have considered all the building components
    • Specialties: Any custom fabricated items or non-standard sub-contractors
    • Details
  • Bidding instructions & construction requirements
  • Process foresight
    • Any red flags
    • Foresee less obvious requirements & conditions

 

Industry saying: “The most expensive thing you can do on a construction project is hire a cheap architect (or engineer)”

 

Being an architect, I realize that this suggestion may seem self-serving, but I can assure you that the homeowner’s pain is real over runaway projects that have ended up costing quite a bit more than if the proper effort was put into planning and vetting contractors bids. I can confidently say that the best path to cost/quality control includes:
  1. A comprehensive, and inclusive design process
  2. Skilled guidance in contractor selection & support during construction
Ideally done by an experienced professional who knows from experience what is needed.