![]() As a result, it’s critical that your educated guess is as well-informed as possible. If you guess too low, you don’t get the profit. If you guess too high, you don’t get the work. You have to estimate the cost of building something that has never been built before. “Estimating” really sums up both the difficulty and opportunity of being a contractor. Read more: What to include in a construction budget And that calculation is the construction estimate. But the contractor has to determine how much the building will really cost. Owners typically work from a budget, which is the amount they expect (and hope) the building will cost. Every bit of it must be accounted for, because if the owner doesn’t pay for it, you will. Temporary shoring, project accounting, equipment rental, insurance…the list goes on and on. This means it should include every single item on the plans and in the specs.Īn estimate will contain many factors not shown on the plans and specs, but still required to realize the building. A good estimate accounts for every single expenditure associated with a project. ![]() Avoiding Common Construction Estimating MistakesĮstimating is the process of forecasting the total costs to complete a construction project.Level 4: Construction Document Estimate.The Five Levels of Construction Cost Estimates.
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