Avoiding cost overruns in the construction of your custom home
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4 June 2019

The process of building a custom home requires considerable monetary investment. Therefore, one of the most important decisions when embarking on this adventure is the choice of the architects who lead the construction. The study of the budgets issued is key to this choice because one of the main concerns of the client is that the price of the work varies or increases due to unforeseen events. In order for this not to happen, it is essential to take the necessary precautions and to meticulously coordinate all the activities of the construction process. The planning of every detail about the personnel, the purchase of material or the use of the machinery allows to make the necessary forecasts and thus avoid surprising additional cost.

In this post, we will analyze the most common causes of overruns in the construction of custom houses, the types of houses and the ways to avoid it. We will also describe our Arquifach guarantee.

WHAT IS A COST OVERRUN IN CONSTRUCTION? AND WHY DOES IT OCCUR?

The cost overrun is the difference that occurs between the budget that was initially calculated and issued and the final cost of the project.

Cost overruns in construction can occur for several reasons. Here are some of them: The cost overrun is the difference that occurs between the budget that was initially calculated and issued and the final cost of the project.

Cost overruns in construction can occur for several reasons. Here are some of them:

  • Delays in construction
  • Calculation errors
  • Poor execution of the intended planning
  • Last-minute design changes

It is logical that the client shows concern and expects the final budgets to be in accordance with the stipulations. At Arquifach, architectural firm, we believe that most of these reasons can be avoided by working on the relationship that exists between client, architects and construction company. Above all, we avoid extra costs on the work and maintain continuous control of all processes and phases, and personalized advice.

MOST COMMON COST OVERRUNS IN HOUSING CONSTRUCTION

The construction of a custom home is a complex process that can generate additional costs, among the most common are contingencies, extras, economic deviations and project modifications.

Contingencies, as its name suggests, are those costs that have not been stipulated and, therefore, are not expected. In this section, we find some that cannot be controlled such as earthquakes, floods or storms and others related to administration such as changes in the relevant regulations and laws. And finally, another type that should be easier to control, such as problems with suppliers.

The overruns resulting from the modifications include calculation errors, bad work or simply last-minute changes by the customer.

Construction extras and economic deviations result when there are differences between the actual amounts and those budgeted or simply those materials or resources that have been included at the last minute.

There are cases in which the construction company may spend more than stipulated, for reasons such as differences in the unit cost of materials, labor and sales.

TYPES OF COST OVERRUNS ACCORDING TO PHASE AND HOW TO AVOID THEM

Cost overruns can occur both in the design phase and during the execution of the work. Let’s analyze a little what each one is and how we could avoid or minimize those extra costs.

Cost overruns in the design phase

It is important to know that possible future cost overruns can already be generated at this stage. Some of the reasons may be to propose designs that are difficult to comply with or not to have the qualified personnel to do so. The important thing is to avoid designing something without the experience or resources to do it.

Another way to avoid cost overruns in the design phase is to make a good, thorough plan that includes all the activities and resources needed to build the custom home. The more this phase is studied and planned, the less chance there will be of generating other activities or expenses that are not foreseen and that in the end increase the budget.

In the planning it is necessary to define the problem and the solutions. For example, if we want extend a room of the house but the architect has not specified well all the details, the group of construction is going to execute it interpreting the loose fringes. These are the kind of situations that in the end generate extra costs because the inaccuracy causes that the result is not the expected one neither by the architect nor by the client.

It is not the same to do it in the city where you have access to materials as it is in towns or remote areas that would increase the cost of transferring materials and human resources.

Another factor of great importance that should be stipulated in the design phase is the time of completion of the work, establishing a realistic schedule.

Cost overruns in the execution phase

During the execution of the project, the first factor to take into account to avoid cost overruns is to try to meet the schedule established for the completion of the work.

Another important factor to consider is the unforeseen circumstances that may arise. For example, if it is necessary to transport materials, which generate additional costs.

The important thing is to plan and coordinate these actions in order to make sure that the construction of the work is carried out in a safe way.

ARQUIFACH GUARANTEE, ARCHITECTURAL FIRM IN CALPE

If you are looking for an architectural firm that builds your custom house and, at the same time, guarantees a quality work, Arquifach is the best option for you. We count on specialized architect, with more than 40 years of experience and a qualified and prepared personnel to meet your requirements in a personalized way.

Each project is studied in detail and budgets are presented by items adjusted to reality, minimizing the chances of economic deviations.

Contact Arquifach architects in Calpe, Altea, Teulada, Moraira and the Costa Blanca in general.

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