1. Chapter 13 Estimates for Remodeling Work

2. Introduction
The remodeling business is different from new-home building in a number of ways.
The remodeling contractor usually deals far more closely with the customer.
There are generally no architects or designers between the homeowner and the remodeler.
Often, there are no drawings to inform the builder what is required.
The remodeler is dealing with structures that are in place.
Much of what is required may be seen and physically measured, but some items cannot be properly assessed because they are concealed.
There is generally more uncertainty with remodeling.

3. Contracts for Remodeling Work (1 of 2)
Lump sum contracts
If the scope of work is well defined and the owner has no wish to get involved in the construction process, this is probably their best option.
The builder needs an accurate estimate to make a profit because of the the risk involved.
Cost plus and management contracts
This makes it easier to make changes. The owner can even design the project as it is built.
Builder/construction manager works for a fee.
There is less need for an accurate estimate up front.
A rough estimate may be called for before work begins.
Or possibly, the builder agrees to a maximum price.

4. Contracts for Remodeling Work (2 of 2)
Unit price contracts
It is used when the amount of work required is uncertain.
Builder will quote a series of unit prices and be paid for the actual quantities of work completed multiplied by these unit prices.
In addition to the cost of the work, unit prices have to include the builder’s overheads and profit.
Combination contracts
For example, the builder is paid a lump sum for the main part of the work; paid unit prices for underground work; and paid cost plus for extra work.

5. The Remodeling Estimate
Steps in preparing an accurate lump sum estimate
Clearly identify all the work to be done.
Measure the work to be done.
Price the work.
Because scope can be uncertain, estimator needs:
A clear outline of what the owner wants
A detailed analysis of the existing building
A detailed plan of what has to be done, and how it is to be achieved

6. Measuring the Work
Measure the work in accordance with the rules described in previous chapters.
Measuring demolition work
Work is measured from information available. Where information is lacking, the estimator shall specify any assumptions made.
Dust curtains, temporary partitions, and such are described and measured in square feet.
See Chapter 13 for further rules of measurement for demolition work.

7. The Remodeling Takeoff
Make lots of sketches.
To define the existing conditions
To outline the new construction required
Specification notes are also useful to indicate what has been allowed for in the takeoff.
It is important to inform the homeowner about what work is included (and not included) in your quote.
On larger jobs with multiple buildings, it is best to proceed building-by-building; then room-by-room in each building.
Sometimes estimators use a simple checklist to ensure all aspects are considered for each room on the project.
See next slide for an example.

9. Pricing Labor and Equipment
In the remodeling sector, much of the work is completed by the builder’s own workers.
Productivity of labor and equipment depends upon two main factors.
Job factors and labor and management factors

10. Job Factors Weather conditions Access to and around the work area
Especially roofing and landscaping
Access to and around the work area
Poor access may limit equipment use.
Size of the project
Larger jobs are generally more productive than smaller jobs.
Complexity of the tasks involved
Complicated work will be less productive.
Location of the job
Availability of materials locally, etc.

11. Labor and Management Factors
The estimator needs to be aware of these factors and adjust prices according to project circumstances.
Quality of supervision
Good supervision is very important to attain high productivity.
Motivation and morale of the workers
High productivity is possible only with good workers.
Good tools and equipment
Productivity suffers if tools are too old or poorly maintained.
Experience of supervisors and workers
If supervisors and/or workers lack experience, high productivity will be difficult to achieve.

12. Labor and Equipment Productivities
Productivity records from past jobs are the best source of productivity information.
Otherwise, you can resort to publications such as Means Cost Data.
Keep a summary chart of historic productivity rates.
See next slide for an example.

14. Pricing and Summarizing
Pricing materials
A list of materials can be compiled from the takeoff onto bill of materials, or recapped with labor and equipment onto pricing sheets as described in Chapter 9.
Pricing general expenses
General expenses should be similar to a housing job.
Use a general expense sheet as a checklist.
Price the items required.
See example (next slide).
The summary and bid
The estimate is summarized and the bid prepared in accordance with the principles discussed in Chapter 12.