DEVELOPING A BUDGET FOR YOUR PROJECT— *Pandemic Has Changed much of This

Clients often have questions about budgeting for their projects. Budgets are very personal, and how you get to a number you are comfortable with can be achieved in several ways. The current value of your home and the market comps in the area are a good place to begin. If you are thinking of adding a family room, you may want to investigate what similar homes in your neighborhood with a family room are selling for. In some cases, clients are adding on to or renovating their homes based on how they want to live and resale is a minor concern. 

We have found the information presented about costs here to be realistic and we hope that you find it helpful, illustrating costs vs. value on several different projects in different regions as well as mid-range vs. upscale. Many clients are looking to us to tell them how much it will cost. Construction cost vary based on complexity and site conditions (i.e. perched on a hill, limited access) as well as the current condition of the home. They are also regional and depend on the amount of detail and complexity. Cost of construction is best determined when you have a set of drawings in your hands from a professional that call out the details and level of attention you are looking for. As skilled architects, we can guide you based on current data for project similar to yours that we are currently working on. Be warned, your neighbor is probably not your most reliable source. I have overheard the conversation at parties where the former client tells the potential client some crazy number….the number needs to be qualified. There is what the contractor charged and then there is what you put it it like cabinets and counters and plumbing fixtures and appliances and …the list goes on. They also might not be including the painting of the entire house when they were finished with the new part or the fact that they had to upgrade all the systems or structure once they got into the project. So be certain you are getting a qualified number…and if you are serious about your budget, be certain to check out the increase in taxes and permit fees you will incur in your town. The Pandemic of 2020…2021….20__ has done a number on the supply chain and that together with natural disasters and demand for housing and renovations has driven the cost well above what is quoted in these articles. The prices are consistent with the rise in the cost of the purchase prices we are seeing. There are typically three components that drive the cost of your project: 1. your timeline, 2. your budget and 3. the design. It used to be you could only pick two….today, you can pick one and the other two will be driven by that….or, you can work to keep them balanced. That is where we come in. Here at Clawson Architects we work to help you work with the lead times on items, honor your budget by making recommendations and creating design solutions that solve your problem.

Any Budgetary Limitations

Clawson Architects does not provide quotes. Building Materials are a commodity and pricing changes daily. Clawson Architects does not provide construction services or construction pricing. We will work with you and your contractor and guide you to solutions that may be more economical if required, however, we are not responsible for the escalating cost of materials or delivering your scope of work for the budget you share. We work with you to align your scope of work and budget during our process by seeking pricing early on in the process. Please note that we do not include our fees as part of the budget as we are working with you to drive the budget to align with your goals.

BUDGETING FOR YOUR PROFESSIONAL FEES

Wikipedia States the following and we have found this to be accurate—

Architects' fee structure was typically based on a percentage of construction value, as a rate per unit area of the proposed construction, hourly rates, or a fixed lump sum fee. Combination of these structures was also common. Fixed fees were usually based on a project's allocated construction cost and could range between 4 and 12% of new construction cost for commercial and institutional projects, depending on a project's size and complexity.

Residential projects ranged from 12 to 20%.

Renovation projects typically commanded higher percentages such as 15-20%.[20]

Overall billings for architectural firms range widely, depending on their location and economic climate. Billings have traditionally been dependent on the local economic conditions, but with rapid globalization, this is becoming less of a factor for large international firms. Salaries could also vary depending on experience, position within the firm (i.e. staff architect, partner, or shareholder, etc.), and the size and location of the firm.

Budgets need to include your professional architectural design fees as well. Many want to know upfront what our fees will be and are uncomfortable with the per hour model we use and are looking for a fixed fee. We completely understand that visceral reluctance to enter into such an agreement. For years I have collected data on projects and researched on line to help people budget for the unknown. Understand, the Architect is working to understand your goals and to exceed your expectations. It is not always clear if the stakeholders are on the same page with their goals for the project. How visual and how quickly the client can make a decision and stick with them. During construction administration, having a competent contractor plays a huge role in your fees. A contractor that is 25,000 less could cost you 25,000 more in architectural fees based on the need to constantly be on watch to make certain the drawings are being followed. It is typically an indication that there will be no project management from a construction superintendent that is on site daily. Recently, I found a website that calls it all out. Our fees are in alignment with what is stated here. Note that if you read through the entire article, it goes on to discuss additional services. These might include, documenting what you already have, models, renderings, 3D drawings, zoning variances, finish and furniture selections. So client beware. The fixed fee being offered by others is for fixed service. Additional emails, phone calls and site visits are more. In the end the professionals must be compensated for their services they provide if they are to continue to exist. They must be fair in their billing or word will get around. A good question might be how many return/repeat clients does the firm have. The hourly contract allows you to participate in ways that could reduce your fees as well as being and incentive to do your homework with the stakeholders and get on the same page about budget, true needs and wants—being prepared to make decisions.

THE CLIENT/ARCHITECT/CONTRACTOR RELATIONSHIP

A successful, efficient project considers the client’s needs, well being, and budget. The Client, the Architect, and the Contractor have very specific and necessary roles. The CLIENT should have specific goals, expectations and a budget that is in alignment with these goals and expectations. The ARCHITECT must guide the client, propose reasonable, sustainable design solutions, and provide accurate detailed drawings. These must meet the client’s requirements as well as applicable building codes and zoning criteria. The finalized construction documents will become the client’s contract with the contractor. The CONTRACTOR must be a responsible craftsman with expertise and the experience necessary to manage the trades and to build the project as designed and documented.

All three parties must work together in concert, the same as the legs of a three-legged stool. They must maintain open dialogue and be able to troubleshoot as a team in order to respond to unforeseen issues or client-initiated changes. Limiting or eliminating any of these components will leave the client with a compromised solution.

Ultimately, the client has two contracts, one is between the client and the architect and the other is between the client and the contractor. The architect works for the client during the construction phase to observe that the construction documents are being interpreted correctly. The architect, as the author of the drawings, is the sole interpreter of the drawings. The contractor is in charge of means and methods. The architect and owner are not to direct work. It is the general contractors responsibility to lay out and direct the work. Beware the contractor that does not want an architect involved. Remember that the architect works for the client to ensure that the investment in the contract documents—also known as drawings and specifications— is realized. This “Three Legged Stool” model also creates checks and balances that have been the successful basis for the many projects Clawson Architects has completed.