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WHY AVERAGE SQ. FT. PRICING WILL NOT WORK
Following are some examples of the problems with using average square foot pricing to project the cost of hypothetical houses or conceptual drawings. Many builders today quickly quote some sq. ft. cost to prospective clients but how can one sq. ft. price be the same for all areas of a home project and exactly what does it include? |
Example 1: |
Corners, Curves, & Complexity |
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DIFFERENCES |
House A |
House B |
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CORNERS |
16 |
8 |
CURVED WALLS |
30 FT. |
0 FT. |
FOUNDATION |
COMPLEX |
SIMPLE |
FRAMING |
COMPLEX |
SIMPLE |
ROOF SYSTEM |
COMPLEX |
SIMPLE |
HOW CAN THESE TWO HOUSES BE ANYWHERE NEAR THE SAME COST TO PRODUCE ?
Example 2: |
Shape vs. Volume |
TYPE |
10 X 10 BUILDING |
2 X 50 BUILDING |
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AREA |
100 SQ .FT. |
100 SQ.FT |
FOOTING |
40 LN. FT. |
104 SQ.FT |
EXTERIOR WALL |
40 LN.FT |
104 LN.FT |
ROOFING |
1 SQUARE |
1 SQUARE |
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CONCLUSION: The Smith House has 260% (2.6 times) the amount of Footing and Exterior Wall area of the Jones House. Cost Impact Categories: Excavation, Footing, Stemwall, Wall Framing, Wall Sheathing, Siding and LABOR! Management Time? |
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Example 3: |
Effects of Site Topography |
Two 3,800 sq ft homes are being estimated
Same Floor Plans, Finish Specifications & Allowances
Base Estimate For Both Houses: $415,000
Additional Costs Incurred By Lot B Due To Extreme Grade Conditions:
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Lot A is Flat |
Lot B is on a Steep Lot |
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1. |
Site Engineering : |
N/A |
$1,850.00 |
2. |
Topographical Map: |
N/A |
$625.00 |
3. |
Excavating & Rough Grading |
N/A |
$11,000.00 |
4. |
Retaining Walls |
N/A |
$13,000.00 |
5. |
Foundation |
N/A |
$7,200.00 |
6. |
Finish Grading |
N/A |
$4,200.00 |
7. |
Driveway |
N/A |
$4,650.00 |
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Building Cost Difference |
N/A |
$41,525.00 |
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Add To These Increased Building Costs The Extended Construction Time And Associated Costs: Project Supervision, Finance Costs, Builder Margin |
| CONCLUSIONS: |
Base Estimate $415,000 |
or |
109.00 /sq ft |
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Total Revised Costs With Site Work $456,525 |
or |
120.13 /sq ft |
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| Example 4: |
Effects Of Owner Selections |
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Two 3,800 sq. ft. homes have been estimated
Same Floor Plans, Lot Conditions, Subdivisions & Exteriors
Base Estimate Amount For Both Houses: $338,500
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Owner A Selections |
Owner B Selections |
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1. |
Windows |
$7,200.00 |
Std. |
2. |
Plumbing Fixtures |
$3,400.00 |
$500.00 |
3. |
Electrical Fixtures |
$2,700.00 |
Std. |
4. |
Humidifier |
$750.00 |
Std. |
5. |
Generator |
$3,200.00 |
Std. |
6. |
Carpeting |
$2,800.00 |
$700.00 |
7. |
Cabinetry |
$7,600.00 |
$740.00 |
8. |
Counters |
$3,100.00 |
$1,200.00 |
9. |
Appliances |
$4,240.00 |
$775.00 |
10. |
Cherry Flooring |
$6,400.00 |
Std. |
11. |
Ceramic Tile |
$3,050.00 |
$860.00 |
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TOTAL SELECTIONS DIFFERENCE |
$44,498.00 |
$4,775.00 |
CONCLUSIONS: |
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Base Estimate $338,500 |
or |
89.07 / sq. ft. |
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Owner A “Adds” |
11.71 / sq. ft. = new cost est. $382,998 |
or |
100.78 / sq. ft. |
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Owner B “Adds” |
1.25 / sq. ft. = new cost est. $343,275 |
or |
90.33 / sq. ft. |
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Years of estimating experience have enabled us to develop a much more scientific method of quickly and accurately estimating a project during the conceptual or schematic stages. This enables us to confidently answer the clients questions concerning the balance of the design vs budget in turn guiding the architect in the development of the plans. The end result being a plan that meets both the clients expectations and their budget. We call this our Rapid Reckoning method of estimation, and will be more than happy to explain and demonstrate its superiority to previous methods when we meet to discuss your project. |
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Coulter Construction Company 3750 Peakwood Drive Roanoke, Virginia 24014 Phone:540-581-0500 Fax:540-581-0500 |
Copyright © 2006 Coulter Construction Company All rights reserved |
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