We consider it part of our job at New Avenue to share crucial information with everyone — customers, architects, designers, and contractors alike. To that end, we share the knowledge we’ve collected from the 10,000+ projects and over 500 builders and tradespeople that have used our project-management platform.
Construction is hard. That’s just a fact of life. Planning rules change. Agencies you’ve never heard of pop up and want permit fees. Design is creative and easy to run with, but 2×10 rafters are always heavy and rarely straight. Plus, any construction project is probably one of the most expensive and meaningful investments you’ll ever make.
In any big project, it’s critical to have a master checklist.
Think of your project budget as one big checklist. It’s the one guiding force that defines what you are going to do and what it will cost.
In developing our budgeting tool, we have tried and tested countless formats for our budgets. To provide our users the best possible tool, we needed to optimize the number of line items to include. We have arrived at 57 design and permitting activities and 173 construction items, for a grand total of 230 line items that you might use in your design/build project.
How we arrived at that magic number, 230 line items
At one point we fantasized about a modular home that was just one fixed price, but we quickly saw that a fixed price was not in the best interest of our clients. Most people want or need to customize, and we found that custom home building, when managed well, delivers both better quality and better value. We will bid competitively to prove this every time.
We looked at the Construction Specifications Institute “CSI Codes” and found they have an overwhelming 45,000+ codes to choose from. Respectfully, we believe only an engineer would appreciate that kind of list. 45,000 rows is beyond the limits of normal human patience, and property owners usually don’t have the time to review that many items.
So we tested. We experimented with different numbers of line items until we found just the right balance. Then every time a change order popped up, we added it to the budget as well. We stabilized at 230 rows years ago, and we now make minor additions and modifications to our process as needed.
How our clients use our budget tool
Most people don’t need to use all 230 rows. In fact, our clients generally only use one quarter of them. It’s important to review them to make sure you aren’t forgetting something major, like windows or landscaping, but you won’t need to address all 230 items individually. It’s painless to see something on the list and decide not to use it (e.g., a new driveway). It is very painful to realize mid-construction that your kitchen cabinets were not included or that 20 different things are “allowances” that you have to pay extra for.
For example, one recent design budget for an entire home used only 22 of the 57 design items, and the construction bid used only 86 of the 173 construction lines. Even a $1,500,000 custom home we recently started used only 40 rows.
The budget, like all projects, is broken down into five key phases:
- Pre-design which includes feasibility research and program development
- Schematic design and planning permits
- Design development
- Construction documents and building permits
Here are some snippets from a master budget:
The construction phase gets much more detailed: