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Ways to reduce construction cost during recession

Total cost of a project can frighten one from even starting a building. This is especially so for one who does not have all the money he needs. Coming up with an estimate of your total building cost can be a very complex process. It is even worse when you are doing it for the very first time because the slightest difference between your estimated cost and actual construction cost can cripple the building project. If a building project fails, it won’t matter if it is a residential or commercial property. The role of effective and efficient construction cost management cannot be overemphasised but you can still find some smart ways to reduce your construction cost.

Customised designs are often more expensive. If your goal is to reduce your construction cost, it is in your best interest to avoid custom designs. You should focus on a simple design and make the plan minimal so that you don’t bloat the cost. To avoid shooting up your construction cost, you can go for a small floor plan with a rectangular or square layout. This sort of plan will cost you less time and less money to accomplish. You also use fewer materials per unit built-up area and this forces your construction cost down.

However, no matter how you want to cut down cost, do not do that with some materials like cement. If you have less cement than the measurement, you may eventually embark on a penny wise, pound foolish project. This is because the building designed to last long may eventually collapse without serving its purpose. If you’re aiming for a minimal cost, consider cutting down on the number of rooms and bathrooms in the house. What this does is that it leaves you with a reduced area, brings your budget for building materials down, thus, reducing your overall construction cost.

It is also not wise to use money you just hit to start a gigantic building because you see it now. You should consider the area

you want to build because areas where you have affluent citizens always attract high cost of man power and labour. Those going to work, say in Banana Island, always go with a mind set that those there do not know how to spend money. Since they have got more than enough to spend, not many of them are judicious in their spending. In this wise, if you want to build your home in such areas with your meager income, you will be bitting off more than you can chew. Your location is particularly crucial if you want to drive down your construction cost. It is fine to opt for locations that offer affordable land but don’t do this blindly. You will be better off, for instance, if such a location is not just cheap but also has a strong potential to experience development in the future. Again, no matter how cheap the land is, don’t buy if the level of the plot is lower than the level of the road. The reason for this is that you’ll end up spending more money buying materials to fill the land. This drives up your construction cost. Plots of land that are the same level as the road are the best.

Construction costs are very stable in the current market due to especially low interest rates, static material prices and abundant skilled construction workers. This is only when the local exchange rates are favourable and especially during recessions. But the question is, how long will that kind of condition prevail? Regardless of market conditions, there are always some practical solutions that can further reduce costs on your project. Construction projects traditionally take many months to design and often, the construction of buildings commence in a different market cycle from when they were designed. It is, therefore, important not to rely on the current market conditions to achieve competitive tender results.

While we are experiencing some relief from inflated construction prices for some years, there is still potential to further reduce costs by driving out poor value design in order to maximise these improved market costs conditions. There are many ways that costs can be reduced on projects resulting in increased value at no loss of quality. However, many excellent ideas are often not realised during the design development. The challenge, therefore, is managing the emerging design so that saving options can be reviewed and incorporated during the design phase.

Facing a recessionary housing market, home builders know they need to adjust to meet today’s economic realities. Home buyers are no longer lining up around the corner trying to outbid one another for a new home, and current business models need to reflect that. With at least another 12 months of sales price declines ahead, readjusting for a new sales environment is essential to survival.

According to a building consultant consulting in Littleton, Columbia, Chuck Shinn, while builders would like to make a few big moves to lighten their financial load with minimal effort, the best move may actually be a continuum of smaller ones. Build what the customer values, not what the builder values, Shinn says. Crown molding has high value in certain areas, such as in a first-floor living room and other public parts of a house, Shinn says. But when builders put crown molding in every room of every floor, it ups their costs and reduces the visual impact, and buyers will not pay extra for it, Shinn says.

Estimating the overall cost of building construction is a complex process. A mismatch between anticipated costs and actual expenses can lead to project failures, irrespective of whether it is a residential or a commercial property. It is also a crucial component of the total housing cost, the magnitude of which is very high in most big cities in Nigeria and outside Nigeria. Effective cost management and value engineering are keys many professional builders rely on for ensuring a profitable business. If you have decided to construct your own house, you should make out your outline and see where you can cut or where you must necessarily increase material quantity to give solid structure. Whenever you decide to customise your design, you should be ready to increase your budget because custom designs are costlier.

A small floor plan with a square or rectangular layout will require less time and money, while consuming fewer materials per unit built-up area, thus, reducing the overall expenditure. Think about having reduced area by minimising the number of rooms and bathrooms. Building a two-storey structure over a one-storey building, is a smart strategy. High front elevation with the use of structural elements for beautification can burn a hole in your pocket.

You can also select your building materials choosing some makes that are lowly priced but can give you the required service. There some materials that have low maintenance and so it will help in cutting the cost if you buy low-maintenance construction materials.

Work with your contractor to source the right materials at lower prices which include locally avail- able bricks, cement, etc.Old or reclaimed materials could also be used, particularly for staircases. Perform judicious selection of products, for instance, RCC (Reinforced Concrete Cement) door frames are much cheaper compared to wooden door frames. Negotiate with various stakeholders for discounts while buying materials in bulk.