How do you estimate the cost of building a new home?
When you think about building a new home, the first question that comes to mind is how much it will cost to build. This is a common question that arises once the decision is made. But there’s no need to panic. In this article, you’ll find some good methods for estimating the cost of building your new home.
The Unit Price Method
If you really want to speed up your estimates and be more accurate, you need to start doing your estimates using the unit price method. The first step in any estimate is to do a numerical count. Do not estimate by hand. If you print out the plans, use a scale and highlighter, invest in digital software. It will be much more accurate and faster at measuring quantities. If you want more information, click this over here now to learn more about this estimation method.
Next, use unit pricing to calculate your direct labor and material costs for the first time. Add in supervision, overhead, profit and markups if you are working with subcontractors. By doing this, you can see your actual costs compared to “the way you’ve always done things. This allows you to be more competitive with your numbers and negotiate better.
The Rule of Two Method
Most contractors calculate the labor price by “3 guys x 5 days”. They put the project together this way. Labor accounts for about 50% of the cost and if you can get a rough idea of the labor cost, just multiply that number by 2 and add 10% as a safety margin.
When adjusting prices, you need to consider harsh working conditions, field conditions, custom items, complexities, etc. Also, start pricing using the database you would have previously established.