Wednesday, October 27, 2010

Nuts N' Bolts: Guess-timating 101

After another blogging hiatus, I'm back and with some content that can hopefully be useful to each and everyone one of you. 


Having a solid background in construction has given me the 'privilege' of working on many different types and sizes of estimates over the years, including some as large as $25M. No matter how big or small the jobs have been, there always seems to be a common thread when it comes time to actually build the project. Something was always missed or overlooked. There are three things that are certain in life for an estimator, taxes, death and missed items in a job estimate. The name guess-timate was developed by my fellow field personel who would receive the budget and often discover those 'hidden jewels' that the estimating department had ignored.


When you sit down to begin your latest project/renovation on your house you NEED to put together an estimate. I always get a good laugh out of shows like Property Ladder when you hear these lavish plans with limited time frames and minuscule budgets. Immediately I know that one of three things is true 
1) They have never thought about actual costs or time frames in an estimate 
2) They are construction virgins 
3) Maybe they're just plain delusional.


I must admit that I was guilty, when we attacked the basement, of just flying by the seat of our pants. Since it was a "spur of the moment" renovation, we neglected to put together an estimate or even a definite plan. Although we were very cost conscious of the things we put into the basement, we were just trying to get it finished quickly in order to qualify for the tax rebate incentives available at the time. Now having put that out in the open, if I had to do it again I most certainly would have writen up an estimate and developed a budget for my plan although it was constantly changing throughout the construction process.


The estimate will give you a quantity of items that you need in order to complete the project, which you can then take with you to the building center to compile your costs. These costs are what will create your budget.


The biggest difference between putting a budget together for a say a new addition vs. a renovation of a bathroom, is the amount of contingency you want to include. Contingency is a line item or percentage used towards the grand total to help cover any screw ups or omissions in your estimate. When doing a renovation your contingency should be higher because your unknowns are increased. Who knows what lurks behind that old drywall or plaster? My basic #1 rule for estimating is if you're unsure, round UP! Its better to have a few extra pieces that can probably be returned, than be short a few screws and scrambling back to the store to finish the job, it will save you a lot of time and frustration.


Construction can seem like a complicated process but if you break it down by its divisions its really basic. It is typically divided into the following 16 divisions: 1 -General Requirements 2 -Sitework 3 -Concrete 4 -Masonry 5 -Metals 6 -Woods and Plastics 7 -Moisture Protection 8 -Doors and Windows 9 -Finishes 10 -Specialties 11 -Equipment 12 -Furnishings 13 -Special Construction 14 -Conveying Systems 15 -Mechanical 16 -Electrical. Categories 10-14 are not used as often in a residential application but its helpful to know these things if say you wanted to put a decorative spire on your new addition, it would fall into the Specialties category.


If you take these categories and start at #1 and ask yourself how is this project going to start? Is there going to be any demolition? How will I dispose of it? How will I deal with the dust? It is helpful to write down any and all questions and run it by a friend or significant other (hopefully someone with some experience in construction) so that they can elaborate on your questions which will lead you to a proper work plan which will help develop your estimate.


I will list our budget below by category and then do a follow up post with the actual costs and you can see where I made my wins and losses.


I didn't add in any contingency as a line item but I did round up on most items and was very conservative in my lump sum items. I was also fortunate to have leftovers from the basement such as drywall and vapor barrier which equated to zero cost for me. Since I will also be doing all the labor work myself and with a few helpers those costs will be limited to cost of beer and meals.


Be sure to check back in a few weeks to see how my guess-timate compares to the actual costs we have incurred so far. I hope this gives you a good starting point of how to get started on a budget. Feel free to ask any questions! Estimating and putting together a budget can be very time consuming and boring but it's essential to a successful project!

6 comments:

  1. Great post! Whenever we start a project all we say is "Now let's not go all crazy and spend too much" Yikes!

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  2. Where's the budget item for "scope creep"? You know, when you say "well, since we have the walls open and we have the electrical guy here, we might as well ask him to do blah blah blah as well"? That always happens with our projects!

    Great post. I'm interested in seeing how you did vs your budget.

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  3. I'm impressed, very impressed! It's obvious you have a background in construction.

    I'm interested in seeing how it turns out too. Good luck!!

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  4. Good post! Can't wait to see how it turns out.

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  5. Thanks everyone! B is pretty good about this stuff... which is perfect, because I'm not! The good thing is, he puts these things together and then I know what my spending limits are!

    @Jennifer - hilarious... everyone knows that stuff comes up for sure! I think that would be our contingency though... that we never added! ha!

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  6. It's nice to know that you have improved over what the old man used to do. I just started the project and whatever it cost, that's what the bottom line was. However, I did cost conscious things like shopping at Re-Store and the "oops" paint section at Lowe's or Home Depot. I'm so proud of what you've done and accomplished in such a short period of time! Keep up the good work.

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