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Estimating Construction Costs for New Commercial Building Projects (continued)-

Market Forces-

As with any business or industry, the construction field can also be subjected to the same market forces of supply and demand which can effect the types of estimates or bids you obtain.  When the economy and housing market is strong, prices will be higher.  When things slow down, bids may be more competitive.  But one observation I have made specifically about the Central Coast of California is that the very high cost of living versus the locally available good paying jobs, puts a special pressure on construction costs that other areas may not generally experience.

If an experienced carpenter can get the same wage in some other part of the state, or even some other state, but can afford to buy a house for his family, which fewer and fewer people are able to do in this area, then he will leave.  This leaves a smaller pool of experienced people to draw from in this area, and the wages and costs to you will be higher.

Doing Some of the Work Yourself-

Almost every client I have had has asked me if they can save money by doing some of the work themselves.  Often, these are the types of things that many people even have some, if not a great deal, of experience doing such as painting, buying and delivering materials themselves, even plumbing and electrical work.  And there have been instances where clients actually have saved a great deal of money by undertaking some of these tasks.

I don't want to go too far to discourage people from taking on some of the work involved with their project, but I would like to share my own personal experiences as a contractor in this regard which has been confirmed time and time again by other contractors with whom I consult on an almost daily basis.

Easily Underestimated-

When working with clients over the years, by and large having them attempt to do significant portions of the work themselves, or even to have someone else they know do the work, has been problematic and, in my opinion, not really saved money in the long run, and has often diminished the quality of the overall project.

I know this is not what you want to hear.  But, I think most people tend to highly underestimate the amount of work it takes to, for example, do the painting work on their project.  It is one thing to paint a couple of rooms in an existing house.  It is another thing entirely to start with fresh drywall, interior doors, trim, cabinets, etc. and to do all the necessary prep work, priming, and all of the other steps it takes to do a quality job that you won't have to be re-doing too soon, or that just doesn't turn out the way you'd like, or that is consistent with the rest of the professionally done work on the project.

And when the general contractor handles these things, it is also a matter of scheduling, having things done in the right order and in a timely manner to stay on schedule with the project.  Staying on schedule will save you money.  If you underestimate the time required to accomplish your end of the work, you may throw the schedule off for the completion of the rest of the project.  That can force re-scheduling of work by future subs, the general contractor may have to leave the job idle until they can return, etc., and that will inevitably cost you more money one way or another.

My Own Experiences-

In my earlier years as a contractor, I was much more open to allowing clients to do some of this work themselves.  As the years went on, and I gained more experience, I became more and more reticent to agree to this, especially when my clients had full-time jobs, and children to care for, etc.  It didn't always turn out poorly, but more often than not I think it was a mistake.  I think almost all contractors eventually come to this conclusion.

So, if you are serious about attempting to do significant portions of the work on your project yourself, think long and hard and take a very honest look at whether or not you have the time, experience, or capabilities to accomplish it in a timely manner, and with results you will be happy with.  Also keep in mind, it is one of the most common bones of contention between owners and contractors.  It should not be considered a magic bullet to solve any budget problems.

I offer a low cost feasibility analysis that can help you get started in the right direction with issues such as estimating construction costs, and many other issues that you will need to know about proceeding with any construction project.

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