“THE BUDGET” Third in a Series
A Budget is not the price of the project! It is an articulation of the resources available to create the proposed Home or Cottage. The budget creates parameters in which the builder and the homeowner need to work within, not how much “things cost”.
Often when we discuss budgets, many clients assume that the budget is the price of the job, but it is not.
THE PRICE IS HOW MUCH THINGS COST TO BUY OR MAKE.
Budgets are the resources that are available to produce the home or cottage. The work is reconciling how much things cost with what is affordable. Collectively we work towards understanding the decisions that must be made to stay on budget.
HOW DO WE CREATE A BUDGET?
Through our experience and data that we gather on all the jobs we produce, we are able to create reasonable estimates on projects, taking into account size (square footage), type and size of rooms and spaces (kitchens, basements, great rooms etc..) andfinally our understanding of the quality expectationsthat the homeowner has.
Given, the data required to produce a reliable budget, the sketch is critical to this step.
Typical question. Why is my sister’s house is bigger and cheaper?
Without details on the construction, understanding of room composition, layout, site costs implications and finishes throughout the house it is difficult to make direct comparisons without a detailed analysis. Often many elements are left out of the equation, garage costs, site costs, HST implications, finish levels. Often some key elements are “high end” granite counters etc. included and other elements are economized (trim finishes etc.). No two custom projects have the same sensibilities to budgeting.
When creating a budget other factors come into play such as the level of difficulty in the design. What does the roofline look like? What is access to the site look like? Have we accommodated sufficient funds for specialty areas, wine cellars, dramatic windows etc? Assumptions must be made at this point in the process, but the better the data, the more reliable the budget.
Some typical items that can be missed in the budgeting process include but not limited to, include:
- Site Costs
- HST implications
- Appropriate level of allowances for specialty items
- Accommodations for change
It is the sketch that drives the production of the budget. Only with a clear understanding of what is involved can we start the task of budgeting the project.
And only with an understanding of budget, can we find the “right” materials for your project and consequently, the “right” price.