How to Estimate the Construction of Buildings

Creating an estimate requires foresight and the complete understanding of construction project.
Creating an estimate requires foresight and the complete understanding of construction project. (Image: calculator image by Randy McKown from

When it comes to constructing a building, figuring out the cost of a project can become a difficult task. Estimates have to include the costs of a building construction operation running from start to finish, factoring in labor hours, materials, equipment costs and a variety of other factors. If you are putting together an estimate for the construction of a building, you can learn the basics of assembling an estimate in a few easy steps.

Calculate the labor hours. You can calculate labor hours at a per-crew basis or by a man-hour basis. A per-crew basis will add up the average amount of hours expected from each construction crew; for example, the amount of hours the plumbing crew will put in. Calculating on a man-hour basis will consider every hour for every person who will work on the project. Using your calculator, add up the amount of labor hours you expect the project to take.

Total your labor cost. Take your labor hours from step one and then multiply that number by your labor rate. If everyone working on your project is working for the same amount of pay, this calculation is very straightforward. But, if people are working on different wages, you will have to separate your labor hours among the different pay scales, multiply a total for labor cost for each pay scale and then add your totals together to get your total labor cost.

Estimate the costs of your materials. When calculating material prices you should consider the material availability, size of your orders, delivery timeframes, physical requirements for the delivery, payment timeframes and exchange rates, if you can buy the material for a lower price from another country. Use your calculator to total up the costs of your materials.

Total your equipment costs. If you are going to rent any equipment for the construction of your building you will need to include the cost of renting that equipment in your total estimate. Using your calculator, total your equipment costs.

Total your subcontractor costs. Many construction jobs often subcontract certain jobs out to different companies. For example, if you are redoing a basement, you might consider hiring a professional basement construction company. That company will give you its estimate for that specific job. Using your calculator, total all the the subcontracting estimates your project will include.

Total your indirect costs. Indirect costs can include design fees, permits, land costs, legal fees, administration costs and any other costs that your project may need such as insurance. Using your calculator, total the amount of indirect costs your project will include.

Using your calculator, add up your labor, material, equipment, subcontractor and indirect costs. This number represents the total estimated cost of your project.

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