Adequate knowledge of construction costs before embarking on any construction project is important. It helps to prepare a thorough budget plan of all expenses required to complete the project. This projection should then be compared with available finances so as to determine the feasibility of a project.

Construction costs include the overall construction expenses incurred by a contractor in the course of developing a building, and this includes labour rates of construction workers, prices of construction materials and construction gears, subcontractor quotes, cost of special machinery, etc. Indirect costs as it relates to land acquisition, permits, design fees, office support, temporary on-site utilities, and mobilization, must be equally considered.

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The nature of building codes and soil conditions at the construction site must also be factored in. Information on all these elements must be carefully considered regardless of the construction project size, duration, and simplicity or complexity of design.

Adequate knowledge allows for comprehensive evaluation and the effective management of construction materials. In the instance of labour rates estimation, the estimator must anticipate the chances of overtime labour and some other factors that may affect productivity such as the weather, change in economic situations, level of technology required, etc.

For many clients, these factors may not appear to be crucial; however, these can affect the duration, cost, and even outcome of a construction project. For instance, in areas where extreme weather conditions are rampant, construction projects tend to be prolonged beyond projected time frames. This might mean exceeding the initially set budget.

An equally crucial point to note is the cost of equipment and technology to be used. The estimation should take into consideration several factors as regards the construction equipment and machinery to be used such as how often a certain equipment and machinery will be needed, the capacity of the equipment, the variance of cost when it is rented and when it is owned, etc.

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One other factor is the proper estimation of construction and building materials prices. This aspect is intricate due to the regular fluctuation of prices, usually dependent on the rate of demand and supply in the market.

In estimating construction materials prices, factors to be considered include the quantity of material required (this depends on the size of the project and the efficiency of the workers), the cost of logistics, local availability of these materials and also the going exchange rate (for materials to be imported).

Failure to give this a thorough consideration will affect the construction project development.

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In the bid to effectively cost a construction project, there are some problems that may obstruct progress. Firstly, the location of the site has a very remarkable effect on costing. To illustrate this, take into consideration a project in a rural area which will most likely involve transportation over long distances, low supply of electricity and even temporary access roads.

Also, the construction site condition which is a rather unpredictable factor can make cost estimation difficult. A contractor might encounter hidden conditions that were not included in the project contract. Few scenarios of these site conditions include rocks where soft soil was presumed, buried debris, etc.

The construction cost estimator has to visit the site and instead reverting to making off-site calculations. Like hinted earlier, a site’s natural conditions and location can impact cost in a number of ways.

Another major problem is the lack of access to real time prices of construction materials and equipment required to achieve the construction goal. This creates a situation where property developers either underestimate or overestimate construction expenses.

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One solution is the outsourcing the task to an eligible and professional construction cost estimator or quantity surveyor. This estimator must be experienced and must possess an understanding of architectural drawings, and must also be adept at construction data collection, analysis and synthesis.

The ideal quantity surveyor must also account for factors that might not be easy to quantify. For instance, they should be able to predict regional variances in market value of construction materials. They should also be able to account for fundamental differences in project types – construction materials required for eco-friendly projects will differ from what is needed for a standard project.

For the most accurate budget configuration, the construction cost estimator must physically visit the site of construction.

Strategic overestimation can also be deployed. This is when construction projects are approached deliberately with slightly more financial resources than is required. This is to cater for possible increase in the current costs of construction materials and equipment in the event of unforeseen circumstances.

This is particularly a viable solution to forestall any possible future instance of under-funding which in turn could retard the progress of construction project. Or worse, bring the project to a halt. A case in point could be specific local challenges like those of levies demanded by omoniles ("sons of the soil") in Western Nigerian communities.

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Finally, price index services can also be used to obtain construction news and curate updated information on market prices of construction materials, equipment and services.

LiveVend is the pioneer of this service in the African construction industry. The technology platform offers middleman service of providing an up-to-date, accurate and real time market price catalogue of construction materials and equipment required to complete a wide range of construction and building projects.

It is clear that expert estimation of construction costs is a prerequisite for achieving positive building and construction project outcomes. And the best way to achieve accuracy in this crucial step in the construction process is to approach it “the technology way.”