08/04/2023
Types of construction estimates: which one to choose? 🤔
Currently, there are four types of cost estimates. These are: investor cost estimate, offer cost estimate, replacement cost estimate, and as-built cost estimate.
▪️ The investment cost estimate is a document that should be prepared before the start of construction. It contains approximate values of construction works, which for the investor are an indication of the amount of funds that should be allocated to the construction of the property.
▪️ Offer cost estimate – it is most often prepared for the needs of public tenders. It presents a price proposal and is developed in a situation where unexpected costs appear - it applies only to previously planned items.
▪️ Replacement cost estimate - it is used in a situation where changes have occurred in the previously prepared cost estimate that significantly interfere with the expenses presented earlier.
▪️ As-built cost estimate - should be prepared after the completion of the works. The calculation determines the amount of remuneration for the construction company, which is final and is the basis for the payment of the fee. At the same time, such a cost estimate can be prepared when construction has started, but no similar document has been prepared before. This cost estimate presents up-to-date information on investment costs, broken down by works. On this basis, you can monitor your expenses on an ongoing basis.
The choice of an investor's cost estimate seems to be a natural option, especially when you want to build a house with a bank loan, as well as when you want to optimize the cost or when you are building an object using the economic system.
👉 Which types of cost estimates would you prefer?
