Take automated construction cost estimating tools with a grain of salt

By Lorianna Kastrop, Vice President, The Kastrop Group, Inc. Architects

A new tool has become available to the public:  automated construction cost estimating.  This tool is available on websites where you can enter your zip code and the number of square feet you wish to add on or remodel, and then the website estimates the range of construction costs for your area.  These costs are often wildly inaccurate.  You should be aware that there is a huge margin of error to these figures.

For one thing, even within the same zip code, the jurisdiction may be different (e.g., unincorporated zones that fall within the County’s jurisdiction, rather than the City’s).  A project in an unincorporated area could have additional costs and fees associated with it, such as power, water or sewer line extensions, etc.  A project might be governed by a specific local zoning ordinance, homeowners’ association, or city precise plan that has not been taken into consideration by the website.

Also, the site conditions matter, such as the slope of the lot, amount of off-street parking available on the site, lot coverage, year the house or building was originally constructed, the type of foundation, and so on.  These are important factors in calculating the cost to add on to an existing building.  Second floor additions, in particular, can trigger structural concerns that may not be accounted for on the automated website.

Don’t forget about market conditions.  Depending on your material selection, and the availability and expertise of contractors, you could go from a routine cost per square foot to a much higher cost.  Custom finishes and cabinetry, and high-tech or energy efficiency features will add to the cost.   Excellent contractors who are in high demand will charge more for their work than “the going rate”.  In some areas that are experiencing building booms it may be difficult to find skilled subcontractors for a particular project (such as historical restorations).  One analogy that we use is that it is less expensive to do repairs and get parts for a used Honda or Ford than for a vintage luxury or sports car.

Lately we have encountered potential clients who are convinced that the automated information they received anonymously from a website algorithm is 100% correct and argue with us about what their project is likely to cost.  Having over 35 years of architectural experience in a wide variety of local projects and an in-person site visit gives us a far more accurate picture of what the project budget should be.  We believe in giving you a realistic picture of not only the costs of the project, but also the possible timing of design, permitting and construction.  Upon hearing estimates that are not as optimistic as you believed, we understand that you will experience some disappointment.  Still, we think that it is better to deal with the news in advance of making the decision to move ahead with the project, instead of when you are in the midst of it.

Also, we want you to be happy with your project at the end of the process.  You are certain to be unhappy if you proceed with rose-colored glasses and then find out about costs you did not anticipate.  So, please take automated estimating tools with a grain of salt.  They can help you get a start on your research, but they are not the final answer.

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