Agenda - 09-02-2008 - 4e - Laserfiche WebLink

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Cost includes the total cost of construction incurred by the builder whether preliminary to, during the course of, or after completion of the construction of a particular improvement. Among these are material, labor, all subcontracts, contractor's overhead and profit, architectural and engineering fees, consultation fees, survey and permit fees, legal fees, taxes, insurance, and the cost of interim financing. There are various methods that may be employed to estimate cost. The methods widely used in the appraisal field are the quantity-survey method, the unit-in-place or component part-in-place method, and the model method. The Quantity-Survey Method involves a detailed itemized estimate of the quantities of various materials used, labor and equipment requirements, architect and engineering fees, contractor's overhead and profit, and other related costs. This method is primarily employed by contractors and cost estimators for bidding and budgetary purposes and is much too laborious and costly to be effective in everyday appraisal work, especially in the mass appraisal field. The method, however, does have its place in that it is used to develop certain unit-in-place costs which can be more readily applied to estimating for appraisal purposes. The Unit-In-Place Method is employed by estimating in- place cost estimates (including material, labor, overhead and profit) for various structural components. The prices established for the specified components are related to their most common units of measurement such as cost per yard of excavation, cost per linear foot of footings, and cost per foot of floor covering. The unit prices can then be multiplied by the respective quantities of each as they are found in the composition of the subject building to derive the whole dollar component cost, the sum of which is equal to the estimated cost of the entire building, providing, of course, that due consideration is given to all other indirect