Owner Builder Estimating: How To Get it Right

What is estimating
Cost estimating involves two fundamental steps. Firstly quantify and secondly costing. After completing a take off and estimate of your plans you will have an idea of the cost associated with building your home. While the cost of your home is extremely important it is believe it or not just as important as your bill of quantities which also comes from estimating your home.

Why it’s vital
Performing a proper take off and costing of your home is important for the following reasons.
• It ensures the home you are trying to build can be built on your budget.
• Will enable you to better predict your money flow during your project.
• Suppliers will find it less stressful and more willing to help you.
• With a bill of quantities you can ensure all trades and suppliers and quoting on the exact same work. Making it easer to decide which is best.
• To successfully schedule your works you need a bill of quantities.
• Ordering the wrong quantities of materials can stop your construction dead in it tracks, and in turn cost you potentially thousands of dollars.
• Your finance lender will in many cases be more inclined to help you should you require further financing. Showing you have planned will save you money in the long run.

What you need
Before you can take off and estimate your home, or have it done professionally you must have the following.
• Detailed plans and drawings (site and footings & house plans)
• Any engineers notes and details relevant to the build.
• A building specification detailing the level of fit out you hope your home to have.

How to do it
We only recommend performing your own take off if you are 100% confident in reading plans, the mathematics required to perform the take off, and the ability to look at plans and think in 3D. This is because when creating your bill of quantities the smallest error in measurement or understanding will have a domino effect throughout
your entire BOQ. Re calculating figures over 30 pages is not the most fun, and your time is better spent on other things.

The first step in creating your take off and estimate is the take off. This will give you what is commonly referred to as a Bill Of Quantities.When performing your take off you always do it in the order in which you will build the home. This means you start with the site preparation and work your way right through to the numbers on the letter box. No
detail is to small to be accounted for. While there are some software packages you can use you will find them to be generally quite expensive. So in many cases you will perform it manually with a ruler, pencil, and pad.

There are two ways in which you can cost your bill of quantities…

• send out requests to trade contractors and suppliers getting them to quote on each part. (please note your BOQ should be flawless to do this)
  or
• apply rates for supply and labor.

The domino effect
The domino effect is something many owner builders don’t even think about until it is to late. Unfortunately when it happens few escape injury free. While owner building is a chance to do things differently and hope for the best you should do everything you can do avoid the domino effect. So what is it... While it might be lots of fun to watch thousands of dominos fall down one after the other the same can’t be said about it happening in your project.

So what is it? The domino effect in relation to your Bill of Quantities refers to when one measurement is used to calculate another, however the one calculated previously was measured in correctly. Now you have two quantities that are in correct and are potentially setting yourself up to have not enough product delivered to site. While in some cases ordering the additional amount might be easy you may find there may be a lead time associated with the product to be delivered or manufactured. If as a result you are unable to go to the next stage of construction which is common you will find you have to
reschedule trades, change delivery dates to match the new schedule and in the process loose time. Remember time and money in residential construction are just as valuable as each other.

How to avoid it
> ensure your BOQ is clear, concise & above all accurate.
> check, double check and triple check measurements that have a bearing on other take-off quantities. Not just when they are taken off initially but each time they come into play.
> create your BOQ with another person.

and above all follow theEstimating Rules.

The rules

• No detail is too small to be considered.
• Check once, check twice, then check again.
• Don’t rush. If you are in the “get it done” mindset then you shouldn't be doing it. If you are finding you are flying through your estimate use the time you save to check your work.
• Your estimate should be set out in an order that anyone involved with your project can follow it and see where you got your measurements from. This will also make your checking much easier.
  For example: next to your dimensions of calculating a wall area your
  description should be something along the lines of “Exterior wall running N>S”
• When exact rates for supply and labor are not known always over estimate.
• Each day you come back to your estimate read from the beginning to where you are up to. You can never read the details enough.
• Hand written is best at first for the purpose of becoming familiar with your project. Type it up at the end.