Quantity Surveyor Report vs Builder Estimate

Galvatron · Postby **Galvatron** » March 31st, 2011, 3:08 pm

which one does the bank use for a mortgage loan?

if the Builder estimate is higher, what happens?

thanks

Rahtid · Postby **Rahtid** » March 31st, 2011, 3:25 pm

Either of them registered?

rfari · Postby **rfari** » March 31st, 2011, 3:30 pm

QS Report are the bank's people, builders estimate is your people. both required for construction. ur builder tryna pull a stunt it you orr?

Galvatron · Postby **Galvatron** » March 31st, 2011, 4:51 pm

Builder estimate much higher.

He keeps telling me that's so I can get the money, so when my loan is secured, we'll finalize figures.

Do builders usually operate like this?

rfari · Postby **rfari** » March 31st, 2011, 5:09 pm

Well f*q tht. Tell your builder that you don't need any extra money. Because he acting as though he doing you a favour but in the long run, he would be calling variances on the construction cost. Usual thing. He just wants to make sure that when he does his skullduggery, you can jump out the pesos to pay him.

*$kїđž!™ · Postby *$kїđž!™ » March 31st, 2011, 5:19 pm

DRead building is very costrly...have to watch does builders cause they will take yur money......

LAbour cost real high these days....those guys making real dollars!!!

*$kїđž!™ · Postby *$kїđž!™ » March 31st, 2011, 5:19 pm

btw the banks require both.......QS and Builders est...

at least thats what my bank told me....

Postby **toyolink** » March 31st, 2011, 5:22 pm

Most experienced builders maintain some sort of relationship with quantity surveyors as a matter of updating their cost indices.
Actually i have found that when i do an estimate independent of a QS the variation is + or - 10 %.
What i have observed however many builders seem to base their estimates on gut feelings and benchmark prices based on what the last similar job came in at.
Hard computations of quantities can be a real challenge for many small contractors who do not have solid engineering support.
The result could be real confusion for the banks who generally rely on the QS estimate to do their risk assessment.
Actually,i suggest clients seek a QS upfront estimate before they go to their banker and contractor which would assist with the setting of financial benchmarks.
Your QS could even help to revise your scope of the project to match your budget.

Galvatron · Postby **Galvatron** » March 31st, 2011, 5:53 pm

thanks guys, any other opinions, suggestions?

rfari · Postby **rfari** » March 31st, 2011, 6:50 pm

Yeah. Make sure and write up a scope of works based on the breakdown given in the qs report. And make sure ur builder keep to it. As ur builder delivers, pay accordingly. Gud luck!

RGF Asset Management · Postby **RGF Asset Management** » March 31st, 2011, 8:58 pm

In my experience, many small contractors provide some un realistically low estimates especially when competing for the job in question. once the job is secured and the work is underway, they come an hit you with all kinda additional sheit that they never discussed in the beginning.
If banks were to rely solely on these estimates, there would be many scenarios where work starts and then stops due to lack of money. Unless the customer has the resources to finish it himself, or secure additional financing, the project remains incomplete.

A QS report from my understanding goes beyond the rough guesstimate that the contractor provides. The QS goes to some trouble to obtain actual market prices of material and labour so that there is a greater likelihood that the amount borrowed would be able to see the project through to completion.

With most financial institutions, both are required.

MonsterPower · Postby **MonsterPower** » March 31st, 2011, 9:03 pm

op just make sure u sign a written contract on the price agreed .. dont take it when he says he will knock off a couple dollars cuz then u neva know what unforseen work wil pop up costing more

rfari · Postby **rfari** » March 31st, 2011, 9:08 pm

Op, what $/sqft rate the qs used?

Rahtid · Postby **Rahtid** » April 7th, 2011, 4:19 pm

Farf wrote:In my experience, many small contractors provide some un realistically low estimates especially when competing for the job in question. once the job is secured and the work is underway, they come an hit you with all kinda additional sheit that they never discussed in the beginning.
If banks were to rely solely on these estimates, there would be many scenarios where work starts and then stops due to lack of money. Unless the customer has the resources to finish it himself, or secure additional financing, the project remains incomplete.

A QS report from my understanding goes beyond the rough guesstimate that the contractor provides. The QS goes to some trouble to obtain actual market prices of material and labour so that there is a greater likelihood that the amount borrowed would be able to see the project through to completion.

With most financial institutions, both are required.

Yes,,this is basically it,,,

brams112 · Postby **brams112** » April 7th, 2011, 6:01 pm

qs most times check by square feet for labour as a estimate,they will look over plans and come with an exact figure for bricks,, cement, steel, gravel and every other thing possible that a builder most times forget to estimate for,that is their job,,,plus they work with real prices not estimates,that is their qualifaction.

Nighttroll · Postby **Nighttroll** » April 8th, 2011, 1:49 pm

The bank needs both but only the QS figure is what the bank looks at to determine the amount that they will lend you for a mortagage.
The QS report has a built-in material price projected figure for 6 months in advance and expires in 6 months.
Most builders estimate is free while the QS is not

Postby **toyolink** » April 8th, 2011, 2:10 pm

The loan to build in many instance is what is called a bridging loan.What this loan really does is facilitate the construction of a building on land which will become subject to a long term mortgage when the property inclusive of land and building is deemed complete.
Here is where the services of a QS is in most cases mandatory,since the release of funds for various phases would be subject to verification of value reports by the QS.Actually as i said previously the bank would always tend to depend on the QS rather than the contractors report.
To avoid an adversarial relationship between the QS and contractor its always smart for the proposed homeowner to encourage free interface between these players from the onset of the project.
Always listen intently to what conditionalities your banker sets otherwise you may have to depend on learning on the trot and that is extremely dangerous.Your objective must be, to be in charge of all the moving parts otherwise you could end up a casualty.