Planning of Construction Costs

Useful Information regarding Planning of Construction Costs which i studied in the Hindu Newspaper I am sharing with you. 
I think this information will be helpful for the people who wants to construct their home.

You can organise your construction costs better, by planning your expenditure in advance.

To calculate your budgetary requirement initially, use tentative estimates and then detail the requirements, item wise and work wise. However, actual estimates will depend on the design proposed by the engineer / architect for your home and the prevailing cost of raw materials in the market.

Assume that you buy 1200 square feet of land at Rs. 250 square feet. The cost of land is 250x1200 = Rs. 3 lacs. Consider that your house will have 200 square feet of open space and a total construction area of 1000 square feet. There are three categories of construction. A superior finish would cost between Rs. 600-900 per sq. ft.; economy finish Rs. 400-600 sq. ft. and low cost finish Rs. 300-400.

The chart provides you a tentative estimate for ground floor and duplex constructions. The finishes mentioned indicate types and quality of flooring, electrical works, sanitary & fittings, paints, timber, doors & windows.

For instance, if you decide to build your house under the second category, the cost per square foot will vary from Rs. 400-600. Hence you total cost, including cost of land, will be Rs. 7-9 lacs.

(However, for the sake of clarity we will take the Economy Finish construction as Rs. 5 lacs, excluding the cost of land, for future calculations.)

Estimating the cost of construction: From the example given above, you can now distribute your construction cost. The standard ratio of material cost, labour cost and other expenditure is approximately 60:30:10. Therefore, you could incur Rs. 3 lacs on matrial, Rs. 1.5 lacs on labour and Rs. 50,000 on other expenditure. This excludes Rs. 3 lacs invested for purchase of the plot.

Stage wise cost of construction: You can also find out the expenditure to be incurred stage wise. This can help you plan your financial requirement during the entire period of construction.

Planning material requirements for each job: 

Please plan your requirements for each job. (See Table A for estimation purposes)

1) Slab casting (slab size 900 square feet, thickness 4 inch.

Concrete ratio: 1: 1.5 :3

Now refer to Table A and calculate the required quantity of all the ingredients:

Slab work:

Concrete quantity = 900x4/12 cubic feet = 300 cubic feet = 300/35.3 cubic metres = 8.5 cubic metres

Please refer to Table A and calculate the required quantity of all the ingredients:

Cement = 8.5x8 = 68 bags

Sand = 8.5x0.42 = 3.57 cubic metres

Gitti = 8.5x0.83 = 7.01 cubic metres

The Concrete Grade shall be vary between M15 to M40 for normal Construction works. The requirement of cement also vary depend upon the ratio of Concrete.

2) Brickwork (300 square feet, wall thickness is 8 inches)

Mortar ratio: 1:6

Please refer to Table B to calculate the quantities:

Material requirement for one cubic metre of brickwork

Note: Approximately 0.25 cubic metres of mortar and 500 bricks are required for 1 cubic metre of brickwork.

Brickwork

Brickwork quantity = 300x8/12 cubic feet = 200 cubic feet = 200/35.3 cubic metres = 5.67 cubic metres

For this, refer to Table B to calculate the quantities:

Cement = 5.67x1.4 = 8 bags

Sand = 5.67x0.299 = 1.7 cubic metres

Bricks = 5.67x500 = 2835 numbers

3) Plaster work (200 square feet, half inch thickness)

Mortar ratio: 1:4

Refer to Table C to calculate the quantity of construction materials:

Material requirement for 100 square metre of Plaster of 12mm (1/2 inch) thickness

Plaster work:

half inch thick plaster area = 200 square feet = 200/10.76 square metres = 18.6 square metres

Refer to Table C

Cement = 18.6x12/100 = 2.23 bags

Sand = 18.6x1.6/100 = 0.3 cubic metres

Remember to add 5 to 8% for wastage always

Cost control measures: You can save considerably on construction expenses by taking a few cost control measures. Here are some cost effective and qualitative inputs to help you build you dream home.

* Assess present and future requirements of your family and plan your house accordingly. You can construct the ground floor, and the 1st floor later according to the enhanced needs of your family members.

* Calculate approximate estimate of your budgetary requirements in terms of cost and quantity. Also, calculate stage wise cost to avoid any cost over-run while your project is at advanced stage.

* Ensure that the design of your proposed home is simple.

* Check and compare the cost of financing through a home loan with other available finance options.

* If all you pillar sizes are the same, you can economise on shuttering requirements.

* Evaluate the terms & conditions of payment to contractors, suppliers and service providers. But, never compromise on quality. Quality pays more than you pay for it.

* Make use of locally available materials.

* Make adequate openings for ventilation and natural light.

* Do not hold large stocks of building materials at the construction site.

* Judicious choice of construction options i.e. ground floor or ground floor + 1st floor, along with future additions of rooms should be clearly communicated to the engineer / architect. This will ensure economies in plot selection and construction design.

Material Requirement For 1 Cubic Metre of Concrete
Table A
Concrete Mix	Water & Cement Ratio	Water in litre per bag of Cement	Cement (Bags)	Sand (cubic metre)	Stone Aggregates (cubic metre
Material Requirement for 1 Cubic Metre of Brickwork
Table B
Mortar	Cement (Bags)	Sand (cubic metre)
Material Requirement for 100 square metre of Plaster of 12 mm (1/2 Inch) Thickness
Table C
Mortar	Cement (Bags)	Sand (cubic metre)
Conversion Table
Table D
1 metre = 3.28 feet
1 square metre = 10.76 square feet
1 cubic metre = 35.3 cubic feet
12" = 1' (12 inch is equal to 1 foot)
1 metre (m) = 100 centimetres (cm) = 1000 millimetres (mm)

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Different types of Contract

Some People are doing the construction works without having any proper agreements and later stage they themselves are facing lot of problems to solve the matters involved in the construction activities.

For the best convenient construction works, any one should do with proper agreements mentioning all the items of works involved in the project. Hence the disputes may be reduced to minimum and can be solved easily.

For the best agreement procedures, one should do their planning of construction activities very well.

Planning of Construction is very essential to decide how we want to construct, how the things of Manpower, Money, Materials, Machinery, Management. If these five "M" is planned very well, you can easily achieve your project in time. If any one of the above five "M" is affected, then the project will face disputes.

Common types of contracts are used in the engineering and construction industry

• Lump Sum Contract
• Unit Price Contract
• Cost Plus Contract
• Incentive Contracts
• Percentage of Construction Fee Contracts

Lump Sum Contract

With this kind of contract the engineer and/or contractor agrees to do the a described and specified project for a fixed price. Also named "Fixed Fee Contract". Often used in engineering contracts.

A Fixed Fee or Lump Sum Contract is suitable if the scope and schedule of the project are sufficiently defined to allow the consulting engineer to estimate project costs.

Unit Price Contract

This kind of contract is based on estimated quantities of items included in the project and their unit prices. The final price of the project is dependent on the quantities needed to carry out the work.

In general this contract is only suitable for construction and supplier projects where the different types of items, but not their numbers, can be accurately identified in the contract documents.

It is not unusual to combine a Unit Price Contract for parts of the project with a Lump Sum Contract or other types of contracts.

Cost Plus Contract

A contract agreement wherein the purchaser agrees to pay the cost of all labor and materials plus an amount for contractor overhead and profit (usually as a percentage of the labor and material cost). The contracts may be specified as

• Cost + Fixed Percentage Contract
• Cost + Fixed Fee Contract
• Cost + Fixed Fee with Guaranteed Maximum Price Contract
• Cost + Fixed Fee with Bonus Contract
• Cost + Fixed Fee with Guaranteed Maximum Price and Bonus Contract
• Cost + Fixed Fee with Agreement for Sharing Any Cost Savings Contract

This types of contracts are favored where the scope of the work is indeterminate or highly uncertain and the kinds of labor, material and equipment needed are also uncertain. Under this arrangement complete records of all time and materials spent by the contractor on the work must be maintained.

Cost + Fixed Percentage Contract

Compensation is based on a percentage of the cost.

Cost + Fixed Fee Contract

Compensation is based on a fixed sum independent the final project cost. The customer agrees to reimburse the contractor's actual costs, regardless of amount, and in addition pay a negotiated fee independent of the amount of the actual costs.

Cost + Fixed Fee with Guaranteed Maximum Price Contract

Compensation is based on a fixed sum of money. The total project cost will not exceed an agreed upper limit.

Cost + Fixed Fee with Bonus Contract

Compensation is based on a fixed sum of money. A bonus is given if the project finish below budget, ahead of schedule etc.

Cost + Fixed Fee with Guaranteed Maximum Price and Bonus Contract

Compensation is based on a fixed sum of money. The total project cost will not exceed an agreed upper limit and a bonus is given if the project is finished below budget, ahead of schedule etc.

Cost + Fixed Fee with Agreement for Sharing Any Cost Savings Contract

Compensation is based on a fixed sum of money. Any cost savings are shared with the buyer and the contractor.

Incentive Contracts

Compensation is based on the engineering and/or contracting performance according an agreed target - budget, schedule and/or quality.

The two basic categories of incentive contracts are

• Fixed Price Incentive Contracts
• Cost Reimbursement Incentive Contracts

Fixed Price Incentive Contracts are preferred when contract costs and performance requirements are reasonably certain.

Cost Reimbursement Contract provides the initially negotiated fee to be adjusted later by a formula based on the relationship of total allowable costs to total target costs. This type of contract specifies a target cost, a target fee, minimum and maximum fees, and a fee adjustment formula. After project performance, the fee payable to the contractor is determined in accordance with the formula.

Percentage of Construction Fee Contracts

Common for engineering contracts. Compensation is based on a percentage of the construction costs.

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