So a buddy of mine is doing a residential development - subdivision type of thing. It's not supposed to be anything high-end, something really low like $80/square foot. He asked for some consulting on my part. I'd love to help, however, since I've only been working for a couple of years, I'm not too well versed in what things cost and whatnot. I'm assuming that it is one of those skills that comes with experience. I wanted to know if there was a handy book/site/whatever than I could reference for some numbers and information on this type of residential development. Any thoughts?
haven't used it but it seems to be appropriate for what you're doing.
i'd get it first, and then start talking to a contractor to verify any uncertainties or answer questions.
not sure where you live, but where i'm at $80/SF is really cheap... so i'd be shooting for low grade finishes like p-lam cabinets, carpet, orange peel finished gyp board walls, etc....
if you don't have experience to rely on or are not willing to hire a professional, then you're just shooting in the dark. if i were you, here is what i would do (if you're going to shoot in the dark, at least use a shotgun). i would take the asking price of houses in the same area (comparables in real estate parlance) with similar sf and finish and divide that cost by the total sf. this is a real, real rough estimate but hopefully you'll be on the high side. you could take the same figure and multiply by .8 to get construction cost. the 20% difference subtracts the contractors profit and market profit from the construction costs. if you think $80/sf is low, then work with $100/sf for now.
don't forget about escalation: 1.5-2% per month depending on the area you're in.
one other thing to think about with production homes - those homes tend to rely on very 'standard' details based off a bastardized, traditional motif. the reason why is that the sub-contractors can fill in the gaps in the drawings themselves and it lends itself to speedier construction (you can cover up a lot of finish work with trim).
also, most of those homes are really optimized for their constructability - walls tend to be as high as standard lumber lengths are (that's 92 5/8" vs. 96" for example). they really try to eliminate waste, use standardized products, etc.
point being, the second you deviate from that formula, the sub contractors are going to scratch their heads. every itch they have costs you $1/sf or more. so, if you're willing to work within some very, very tight parameters, great. enjoy the experience and do something worthwhile. if you're thinking more 'cool' factor, get out now...
an aside, but i know of a residential and commercial builder here in NM that builds single-story type-V homes for $55/sf (their cost). They build them on their lot and truck the sections to the site and set them on conventional foundations and bolt the pieces together. Sure they're nothing pretty, but they're not 'manufactured housing' either that lose their value from day 1.
The secret is keeping their crews busy and on their jobsite since they invest a bit in training the crews on their standard framing details.
They do their own permitting and the inspectors just periodically drop by their lot to walk through a bunch of permit cards.
$55.00 sf can't build a dog house for that little money, so it would be near impossible to build a whole house for people to live in. The low end around here would put a one in front of the fifty-five. What you get is a vinyl sided, gypsumboard, asphalt shingle low end spec house.
You can always go in to your local building department and request to see the permits for a recently built house or one under construction
and see what the builder is saying it is costing, as his cost are directly tied to the building permit fee. Just don't forget to look at
the electrical permit and mechanical permit just so you can factor in those cost. Usually they are pulled under seperate permits. You should also keep in mind, the cost you are looking at are void of
sewer hook up fees, water hook up fees, electrical hook up fees.
Once you have all this information boost it by 20 percent and you will be in the ball park, because the cost given to the city is most likely lower than the actual build out cost.
The information that you are juggling here is extremely precarious and impossible to judge. why don't you post a line item breakdown and the units (SF's, LF's, CY's, etc.) and then we could help you with unit costs, ratios, etc.
Working from these absurd ballpark numbers will get you killed - or bankrupt if your fee is ties to a percentage of cost of construction.
Also, the books are fairly useless - especially in today's market environment...
"Also, the books are fairly useless - especially in today's market environment..."
this has been something i've assumed to be true for the last 3-4 years, but i'm not so sure it is now true. the material costs escalation craze seems to have died down. do you really still think these books are useless?
jeffe I think so, but it ultimately depends on the degree of accuracy that you are after. there are so many factors putting pressure on any kind of pricing and bidding situation that are outside of the books parameters that it is difficult to use. however, if you know this, use your contingencies appropriately, have full disclosure with your client and are level headed and realistic they can serve as guidelines for a decent ballpark estimate. what i use are field sources that are willing to give me prices on all line items, and usually i have more than one source if i have not worked or built anything that the source priced. they books are usually a way to bridge the anxiety of things being overly general or overly detailed - yet ultimately unreliable, as the only real price is the one in the construction contract. anything before that is an approximation tool to make informed decisions with.
i think devil dog's suggestion is probably the way to go, and maybe using means as a real time reference when you are designing (don't forget to add 20-50% to everything depending on your location. means always estimates way low for me).
Construction cost estimates will vary tremendously by locality, especially for the full builder not able to tap into national supply chains... local code particularly for site-work requirements/grading/etc etc, unionized versus non-unionized labor,lumber, steel (if applicable) other materials... $80-90 is reasonable for random outer Las Vegas subds for generic balloon frame stuff. Just south of twice that for some places in coastal California....
The development is going to be in Northern Michigan, so I'm assuming $80/sf will go longer there than in other areas. Starting price will be $150,000/house with a cap of $220,000. I'm guessing 3-4 bedrooms and roughly 2,000 s.f., give or take. It's most likely going to be wood frame construction-maybe balloon framing. Fees to the city for sewer, water, etc. are already taken care of.
I know this is a tight project, but very little room to move, but at the same time it's an opportunity to learn, which is always good. I just don't want to start thinking of cool things that would never be possible with the budget constraints - build myself a framework so to speak.
Good on ya. Learning is what it is all about. I would discuss with your developer freind that you (and all architects) are not liable or accountable for estimating hardcosts. I typically estimate on the high side of things for clients, and let the GC varify. Developments cost a lot, and put off a lot of money. As as you know money can do strange things to friends. Just be careful what you are saying and what advice you offer.
Devil dog and Bakema bring up some very good points.
Out of the gate your hardcost budget is challenged. It is fairly low. Material costs are on the rise everyday, leveling off for sure, but still rising. The current versions of Means and 07 Cost Book will have a margins of error in them. One way contractors (typically bigger firms) are trying to control costs is working with material brokers and locking up certain quantities of materials at a specific price. Due to the length of construction project the costs for the first home may be sig. less than the costs for the last home. Development is very tricky. Inflation, escalation and material costs need to be accounted for.
Also need to look at the bigger picture:
How many homes are you building?
What is the rate of return on the investment?
Over how many months or years?
How big will the debt load be? for how long?
Permiting costs, grading fees etc.
All of these things (and many more) will impact the over all project and costs of the development. Some can determine the success or failure. Development is complicated, not rocket science, but darn close. Be careful, read as many books on construction costs as you can, and ask a lot of questions.
And lastly, the creative aspect will be on how you use 'off the shelf' efficiently. I wouldn't expect great design opportunities here. Production construction is exactly that- NOT CUSTOM- many repeat details, finishes, etc.
another option to keep construction cosy down, since you have a low price point is "modular" we have recently been producing custom modular designs for a small development here in florida and we tried everything to v.e. the project down to meet the clients price point and we ended up with crap so we have been doing modular for a higher end, energy efficient resolution and decided to see what we could do on the lower end and still get the design result we wanted and we are at 93/sf which includes site work (minimal though) the foundation is plies and are drives are gravel (gotta love the minimal approach in north florida). but anyway we have had great success with the quality of the product we get from the mods and we got the added bonus that these meet the 155mph criteria for fortified homes (tax credits), FGBC (green, since LEED residential in only a pilot program rightnow) (tax credits) we are certified EnergyStar homes (energy bill credits) and for a few bucks more we have convinced the owner to go healthy home as well...
when you say you used modular, do you mean simply using mdoular components or that the entire house was a modular home? if it was just components, is there room to get creative in terms of design?
when i say modular i mean whole house, but we have been designing the house and "modularizing" it, basically i know the parameters of the modular building process and design accordingly. the component system or "panelized" doesn't seem to be both time and or cost effective.
the ultimate beauty of the modular system is that it doesn't change the design process, what it does is change the building process. as a builder rather than stick building your homes over a 8-12 month span. the modular process reduces that process to 3 months, so that even if you are near 120/sf what really makes it cost effective is that you don't sit on the lot that entire time, pay the intrest, they (if market willing) will sell off their house before they even order the house and before closing the house is there and finished. i can go on and on with this, i am really buying off on this process because we can demand and get a superior end result in 1/4th the time. e-mail me if you want to talk further and see examples of what we are doing...
Judging from your statements I am going to assume that you are either a young architect or an intern. Keep in mind that part of your professional responsibility is to either;
A. Notify the client that the services are beyond your abilities and they should solicit another professional.
or;
B. Use the problem solving skills that should have been taught to you in architecture school to learn your trade.
Hence, your best option is to work as a liaison between your client and a construction professional or real estate developer to glean current market data and experience from their process.
This means that you need to learn all you can from those individuals in order to enhance your professional abilities and expanding your services so that in the future you can offer these services to a client with the legitimate means to accomplish them.
Feb 20, 07 11:30 am ·
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cost estimate
So a buddy of mine is doing a residential development - subdivision type of thing. It's not supposed to be anything high-end, something really low like $80/square foot. He asked for some consulting on my part. I'd love to help, however, since I've only been working for a couple of years, I'm not too well versed in what things cost and whatnot. I'm assuming that it is one of those skills that comes with experience. I wanted to know if there was a handy book/site/whatever than I could reference for some numbers and information on this type of residential development. Any thoughts?
a phone book?
Thanks. el jeffe. I'm assuming you've used it before. Was it helpful?
haven't used it but it seems to be appropriate for what you're doing.
i'd get it first, and then start talking to a contractor to verify any uncertainties or answer questions.
also, The Architect's Portable Handbook has some basic rules of thumb for most materials...
not sure where you live, but where i'm at $80/SF is really cheap... so i'd be shooting for low grade finishes like p-lam cabinets, carpet, orange peel finished gyp board walls, etc....
That book is tough to use if you haven't done any estimating before. Rules of thumbs (googled or otherwise) might be easier.
I don't think $80/sf is reasonable in anywhere...
Is that the total cost - framing, finishes, etc??
if you don't have experience to rely on or are not willing to hire a professional, then you're just shooting in the dark. if i were you, here is what i would do (if you're going to shoot in the dark, at least use a shotgun). i would take the asking price of houses in the same area (comparables in real estate parlance) with similar sf and finish and divide that cost by the total sf. this is a real, real rough estimate but hopefully you'll be on the high side. you could take the same figure and multiply by .8 to get construction cost. the 20% difference subtracts the contractors profit and market profit from the construction costs. if you think $80/sf is low, then work with $100/sf for now.
don't forget about escalation: 1.5-2% per month depending on the area you're in.
sano,
one other thing to think about with production homes - those homes tend to rely on very 'standard' details based off a bastardized, traditional motif. the reason why is that the sub-contractors can fill in the gaps in the drawings themselves and it lends itself to speedier construction (you can cover up a lot of finish work with trim).
also, most of those homes are really optimized for their constructability - walls tend to be as high as standard lumber lengths are (that's 92 5/8" vs. 96" for example). they really try to eliminate waste, use standardized products, etc.
point being, the second you deviate from that formula, the sub contractors are going to scratch their heads. every itch they have costs you $1/sf or more. so, if you're willing to work within some very, very tight parameters, great. enjoy the experience and do something worthwhile. if you're thinking more 'cool' factor, get out now...
an aside, but i know of a residential and commercial builder here in NM that builds single-story type-V homes for $55/sf (their cost). They build them on their lot and truck the sections to the site and set them on conventional foundations and bolt the pieces together. Sure they're nothing pretty, but they're not 'manufactured housing' either that lose their value from day 1.
The secret is keeping their crews busy and on their jobsite since they invest a bit in training the crews on their standard framing details.
They do their own permitting and the inspectors just periodically drop by their lot to walk through a bunch of permit cards.
i thought all houses in new mexico were done in adobe handed down by anashtazi's???
vado, perhaps you're thinking of the casinos.
$55.00 sf can't build a dog house for that little money, so it would be near impossible to build a whole house for people to live in. The low end around here would put a one in front of the fifty-five. What you get is a vinyl sided, gypsumboard, asphalt shingle low end spec house.
You can always go in to your local building department and request to see the permits for a recently built house or one under construction
and see what the builder is saying it is costing, as his cost are directly tied to the building permit fee. Just don't forget to look at
the electrical permit and mechanical permit just so you can factor in those cost. Usually they are pulled under seperate permits. You should also keep in mind, the cost you are looking at are void of
sewer hook up fees, water hook up fees, electrical hook up fees.
Once you have all this information boost it by 20 percent and you will be in the ball park, because the cost given to the city is most likely lower than the actual build out cost.
The information that you are juggling here is extremely precarious and impossible to judge. why don't you post a line item breakdown and the units (SF's, LF's, CY's, etc.) and then we could help you with unit costs, ratios, etc.
Working from these absurd ballpark numbers will get you killed - or bankrupt if your fee is ties to a percentage of cost of construction.
Also, the books are fairly useless - especially in today's market environment...
Good luck!
"Also, the books are fairly useless - especially in today's market environment..."
this has been something i've assumed to be true for the last 3-4 years, but i'm not so sure it is now true. the material costs escalation craze seems to have died down. do you really still think these books are useless?
jeffe I think so, but it ultimately depends on the degree of accuracy that you are after. there are so many factors putting pressure on any kind of pricing and bidding situation that are outside of the books parameters that it is difficult to use. however, if you know this, use your contingencies appropriately, have full disclosure with your client and are level headed and realistic they can serve as guidelines for a decent ballpark estimate. what i use are field sources that are willing to give me prices on all line items, and usually i have more than one source if i have not worked or built anything that the source priced. they books are usually a way to bridge the anxiety of things being overly general or overly detailed - yet ultimately unreliable, as the only real price is the one in the construction contract. anything before that is an approximation tool to make informed decisions with.
Rember Site Work can kill a project when it comes to Costing!
80 sf seems a little low to me, i wonder why kind of structure that is
probably with no electrics, plumbing or finishes...actually we'll leave out the structure too just pay your lawyer directly
i think devil dog's suggestion is probably the way to go, and maybe using means as a real time reference when you are designing (don't forget to add 20-50% to everything depending on your location. means always estimates way low for me).
Construction cost estimates will vary tremendously by locality, especially for the full builder not able to tap into national supply chains... local code particularly for site-work requirements/grading/etc etc, unionized versus non-unionized labor,lumber, steel (if applicable) other materials... $80-90 is reasonable for random outer Las Vegas subds for generic balloon frame stuff. Just south of twice that for some places in coastal California....
sorry.."full builder" was supposed to be "small builder"
The development is going to be in Northern Michigan, so I'm assuming $80/sf will go longer there than in other areas. Starting price will be $150,000/house with a cap of $220,000. I'm guessing 3-4 bedrooms and roughly 2,000 s.f., give or take. It's most likely going to be wood frame construction-maybe balloon framing. Fees to the city for sewer, water, etc. are already taken care of.
I know this is a tight project, but very little room to move, but at the same time it's an opportunity to learn, which is always good. I just don't want to start thinking of cool things that would never be possible with the budget constraints - build myself a framework so to speak.
Sano:
Good on ya. Learning is what it is all about. I would discuss with your developer freind that you (and all architects) are not liable or accountable for estimating hardcosts. I typically estimate on the high side of things for clients, and let the GC varify. Developments cost a lot, and put off a lot of money. As as you know money can do strange things to friends. Just be careful what you are saying and what advice you offer.
Devil dog and Bakema bring up some very good points.
Out of the gate your hardcost budget is challenged. It is fairly low. Material costs are on the rise everyday, leveling off for sure, but still rising. The current versions of Means and 07 Cost Book will have a margins of error in them. One way contractors (typically bigger firms) are trying to control costs is working with material brokers and locking up certain quantities of materials at a specific price. Due to the length of construction project the costs for the first home may be sig. less than the costs for the last home. Development is very tricky. Inflation, escalation and material costs need to be accounted for.
Also need to look at the bigger picture:
How many homes are you building?
What is the rate of return on the investment?
Over how many months or years?
How big will the debt load be? for how long?
Permiting costs, grading fees etc.
All of these things (and many more) will impact the over all project and costs of the development. Some can determine the success or failure. Development is complicated, not rocket science, but darn close. Be careful, read as many books on construction costs as you can, and ask a lot of questions.
And lastly, the creative aspect will be on how you use 'off the shelf' efficiently. I wouldn't expect great design opportunities here. Production construction is exactly that- NOT CUSTOM- many repeat details, finishes, etc.
Good luck.
Sano,
another option to keep construction cosy down, since you have a low price point is "modular" we have recently been producing custom modular designs for a small development here in florida and we tried everything to v.e. the project down to meet the clients price point and we ended up with crap so we have been doing modular for a higher end, energy efficient resolution and decided to see what we could do on the lower end and still get the design result we wanted and we are at 93/sf which includes site work (minimal though) the foundation is plies and are drives are gravel (gotta love the minimal approach in north florida). but anyway we have had great success with the quality of the product we get from the mods and we got the added bonus that these meet the 155mph criteria for fortified homes (tax credits), FGBC (green, since LEED residential in only a pilot program rightnow) (tax credits) we are certified EnergyStar homes (energy bill credits) and for a few bucks more we have convinced the owner to go healthy home as well...
architorturealist-
when you say you used modular, do you mean simply using mdoular components or that the entire house was a modular home? if it was just components, is there room to get creative in terms of design?
I just took a look at some of the "better" prefab modulars on wired.com and the lowest cost/sf was $120, still over our budget.
http://www.wired.com/wired/archive/14.01/prefab.html?pg=4
when i say modular i mean whole house, but we have been designing the house and "modularizing" it, basically i know the parameters of the modular building process and design accordingly. the component system or "panelized" doesn't seem to be both time and or cost effective.
the ultimate beauty of the modular system is that it doesn't change the design process, what it does is change the building process. as a builder rather than stick building your homes over a 8-12 month span. the modular process reduces that process to 3 months, so that even if you are near 120/sf what really makes it cost effective is that you don't sit on the lot that entire time, pay the intrest, they (if market willing) will sell off their house before they even order the house and before closing the house is there and finished. i can go on and on with this, i am really buying off on this process because we can demand and get a superior end result in 1/4th the time. e-mail me if you want to talk further and see examples of what we are doing...
sanofiSYN...
Judging from your statements I am going to assume that you are either a young architect or an intern. Keep in mind that part of your professional responsibility is to either;
A. Notify the client that the services are beyond your abilities and they should solicit another professional.
or;
B. Use the problem solving skills that should have been taught to you in architecture school to learn your trade.
Hence, your best option is to work as a liaison between your client and a construction professional or real estate developer to glean current market data and experience from their process.
This means that you need to learn all you can from those individuals in order to enhance your professional abilities and expanding your services so that in the future you can offer these services to a client with the legitimate means to accomplish them.
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