To predict construction costs when a new project is conceived, contractors will use a rough estimate. So what exactly is the concept? How is it calculated? Tan Phat Construction will answer the above questions for you through the following article, stay tuned!

## What is an estimate

?Actuation is a calculation to estimate how much the total investment in a construction project is. To be able to calculate the approximate total investment, the investor needs to be based on many different bases. Or the contractor can calculate through his experience and statistics from similar projects.

After a lot of works and conducting detailed summaries, the contractor can easily find a statistical function that correlates the cost of a certain variable. Usually contractors will base on a construction price list for a specific total area. For example, the construction price for housing projects is currently 2.8 – 3 million VND/m2.

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However, each construction site is completely different, in the inner city or outside the province there is a significant difference in price. In addition, there are works in the provinces where the soil structure is weaker, the construction unit price will increase significantly. Normally, the reinforcement of the foundation will increase about 20-30% compared to the common ground.

Estimation is a calculation to estimate the total investment in a construction project

## What are the characteristics of the calculation method

?The usual calculation is based on experience as well as the actual unit price price/m2. If based on the statistics, it will certainly not be accurate, even the error is extremely large. Many people still depend on the quantity and quality of statistical samples to get the most perfect numbers.

In addition, contractors also rely on works with similar shape and quality in terms of structure, geology, and stratigraphy to be able to calculate. Usually, the error of this calculation method is quite high. Even the possibility of error is more than 10%, there are isolated cases where the error is up to 50%.

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That’s because currently there is no construction business or an organization that can gather and analyze this data. Therefore, small contractors are facing numerous difficulties in providing the most reliable data.

Normal calculation based on experience as well as actual unit price

How is it calculated?

To be able to calculate the approximate approximate number of estimates, the current construction contractors will conduct detailed estimation. But in order to have an authentic estimate, the work must be completed with detailed designs, specifically:

Procedures for geological exploration; Architectural exterior documents; Structural exterior records; Design papers for water supply and drainage systems; External records of electrical systems, telephones, computers, security cameras…

In addition, the estimating staff also relies on external drawings to calculate detailed estimates for construction projects. In which, this estimate is included by 3 important tables: prediction table, total table. Consolidation of material costs and a summary of the estimated cost.

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### Establishment forecast table

The forecast table will represent the most accurate volume for many tasks and items that need to be done of the project. Specifically in the work will have to build how many m2 of brick walls as well as how many centimeters thick bricks will be, how many concrete blocks of floors, columns …

### Summary of material costs

As the name implies, this table has the main function of listing the exact quantity and market share of all the materials used. For example, how many tons of cement and shaped steel must be used, how many bricks and tiles, and how much does it cost?

### Summarize the estimated cost

The estimated cost will show the cost of materials, labor and necessary selling prices for the construction work. This is the estimated result that is considered to be the most accurate, with an error of only about 5% for the project’s valuation.

To be able to calculate the estimate, the construction contractor will make a detailed estimate

Epilogue

Through the above article, we have shared with you what the concept is and how to calculate it. Depending on the importance of the project, depending on the risk tolerance and error, investors will choose the most reasonable calculation plan. You are wondering how to estimate for your project Tan Phat Construction will guide you. Contact us to get all your questions answered!