Creating a budget for your construction project is one of the first steps toward completing the project. As construction projects can get overwhelming with all the logistics and moving parts, it’s best to know the common categories expenses can fall under. This helps ensure all the i’s get dotted and the t’s get crossed.

The Fundamentals   

The first category of costs, the fundamentals, includes costs that almost every construction project will have. While more intricate projects will have a few more added costs, these are thbudgete bare minimum every project should budget for.  

  • Insurance- There are a few options you’ll have to decide between, based on the nature of the project. General liability works in a lot of cases, but sometimes job-specific or industry-specific are needed.
  • Blueprints- This covers the costs of architects and, if needed, structural engineers.
  • Permits- Checking the zoning laws, surveying the land, and squaring away the electrical, plumbing, and mechanical needs.
  • Site Prep- Land will need to be cleared if this is a new construction project, which requires heavy machinery and labor.
  • Contingency- Anything that can go wrong will. So, tack on an extra 5% to account for any Murphy’s law related costs.
  • Materials- This is where your options really open up and you can either save or spend a lot of money. The cost of doors, windows, walls, insulation, floors, and other building materials will make up a large portion of the budget.
  • Labor- Lastly, is the cost to put all those materials together.

One additional concept that’s helpful to consider when budgeting for construction, is the difference between hard and soft costs. Hard costs include costs like labor and materials, which are fairly easy to budget for because the cost of these items is set and can be estimated if you know where to look. Soft costs, however, refer to the cost of insurance and fees, which are harder to estimate since these can fluctuate.