Homeowners or clients who are ready to remodel their houses are asking for as much detail as possible when it comes to getting the job completed for the dream project of dream projects in their lives. However, there are so many things involved in home remodeling and finding the right contractor for the job is just one of them.
A contractor in any industry, especially those in the construction business specializing in home renovation, repair or complete remodeling projects should be prepared to write a cost estimate template for the task. As you probably know, estimates vary depending on the job and the type of project a contractor takes on. For instance, a minor home renovation estimate is not going to have the same breakdown as that of a large-scale remodeling project. To get your estimates right, start out with the following elements:
1. Contact Information: One of the first things you should include in any estimate is your firm’s contact details. Obviously, the customer should know how you can be reached easily if they consider you for the project. Moreover, you would want to know how to reach the client as well. This doesn’t only help you know more about the task at hand but it also a good sign for the customer, showing them that your needs are prioritized on the estimate.
2. Project Summary and Plan: Home remodeling usually demands more within the overall project such as when you have to install the lighting and take care of the plumbing in the property. Moving parts takes time and work so it’s a good idea to summarize and plan how the work should be done. It’s also best to outline how you and your men are going to do the work and perform risk mitigation before issues happen.
3. Payment Specification: As far as costs go, it’s better to be upfront with the potential client and let them know how much money they need to prepare to complete the project. This also helps clear up any confusion with the costs, before any work is started, so let the customer know about payment policies such as late payments, mode of payment, schedule and how you plan to handle payment for materials needed. Providing information from the very beginning will do both parties a favor, to ensure work and payment are done at the dates set.
4. Costs: This is arguably the most important part of the estimate for obvious reasons. In this section, you need to be as detailed as possible and any miscellaneous items should be accounted for. Below is one example of the things you shouldn’t miss when coming up with an item list for home remodeling costs:
A cost estimate is more than just your average itemized list of costs because it also details the assumptions behind each cost. These assumptions are then organized into a project report to serve as the basis of the estimate, detailing what the cost includes and what it doesn’t. The usefulness of a cost estimate relies on its accuracy. Follow these steps to write a quality cost estimate:
1. Be accurate: Any cost estimate only proves its worth when it is accurately given. You may have got the most accurate estimate strategies but you can improve its accuracy by revising your estimate templates as the project is defined. Make allowances for shortages in resources, project evaluation, and contingencies.
2. Provide documentation: Construction project leaders are naturally held responsible for the cost estimates they release so it is crucial the assumptions behind the estimates provided are properly identified and put on file. Documentation helps avoid misunderstandings and helps parties understand the varying versions of estimates in the future.
3. Detail risks: Any home renovation project can be affected by negative risks so it is vital to have allowances in your cost estimates. Identifying risks and allocating contingency plans is the best and most common strategies. This is also why estimates should actually be overestimated rather than the opposite and those who prepare them should be able to establish the level of tolerance for deviating figures.
4. Apply uniformity: Be consistent. If you specialize in home remodeling projects around the area and they’re loosely the same type, having a consistent unit cost across your projects is reasonable. You can make adjustments based on trends and inflation but this type of uniformity in your estimate is possible especially for construction companies that are taking many similar projects which allows them to develop lists for recording recommended and average unit costs.
Cost estimation is arguably the cornerstone of every building construction and having an estimation of material labor costs can save your company thousands of dollars when done properly. Here are some tips you can follow to make sure your estimate will offer an accurate benchmark price:
An estimate in the construction sector is a document that contractors develop before or during the bid or proposal-writing process. The cost estimate may include an accounting of taxes, overhead costs, and subcontracts for large-scale projects and added costs for equipment.
The cost varies depending on location but the national average for a remodeling project on multiple rooms is $42,852 with a typical range of $17,407–$68, 659.
An estimated cost in any trade may just be a ballpark figure. But in the construction business, you could be on your way to make a neat profit off a home remodeling project if you get it right. Get it wrong and you could easily lose money by overspending on your materials and overhead costs. Creating an accurate and credible cost estimate is tough, especially when you’re new to the trade. No two remodeling projects are exactly the same and there’s no shortage of risks and pitfalls if you don’t plan right, so it pays to be accurate before you start the actual work.