Hard Costs are similar to tangible assets that must be acquired for completing your construction project. Hard costs are mostly consisted of the actual construction costs occurred for creating the project. In general, hard costs are easily quantifiable and can be determined with such certain that usually they are detailed by an experienced estimator. In general, hard costs relate to any part of the work or costs associated with the actual project.
Hard cost should include physical items like Land Cost/Value, Site Prep/Grading, Building Structure, Septic tank/Well, Landscape, Inventory, Contingency, Construction Contract, Change Orders, Cost overruns etc.
Building Structure- Hard costs within a structure should include all labor and material necessary for completion of the whole building or structure.
Site- Hard cost within the site will include all utilities underground, aerial, water systems, drains, fire, paving, grading, etc.
Landscape – Hard costs in landscaping works should include grass, lawns, trees, mulch, shrubs, fertilizer, and every other material found in the construction of the projects based on the architectural drawings.
Contingency- Contingency denotes to the reserved amount of money taking into consideration all estimated unforeseen conditions affecting construction process. Like an amount contingency is not measurable, it is being estimated from historical data between a five and ten percent of the total project costs for new projects and between 10 and 20 percent for remodeling projects.
Change Orders- Change orders will fall under the building structure item in the hard costs. Some builders segregate this item from building structure for accountability process, but it also takes all additional expenses associated with construction projects.
Posted by Rajib Dey
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Global Associates
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