The rise in construction prices has contributed to significant construction material shortages, leading to enormous delays and even the cancellation of home projects by multiple contractors.

But what is set to change in the coming year, if anything? Will the industry see a reprieve, or will construction costs climb unabated?

Rising material costs felt across the market

Unfortunately, the rising cost of just about everything has caused a massive stall over the summer as inflation tightened its grip on the Australian construction industry. The slowdown follows an enormous boom in the construction market before mid-2022. At that time, folks used COVID relief funds to invest in properties – property acquisition exploded, up 56% on the previous year.

No matter what part of the home construction industry, building material prices skyrocketed this year. The steelmaking industry saw a massive 42.1% increase in cost, followed by timber at 20.1%; up over 10% were electrical, plumbing, glass product and aluminum.

Why are building material prices rising?

Building industry material prices across the construction industry have skyrocketed for a few reasons. Whether you’re talking about concrete blocks, gypsum sheets, or even laminate flooring, prices are up. Experts see some consistent reasons why building material prices have risen steadily.

Shortages

There’s been a general shortage of raw materials across the construction industry. A rush on the housing market has primarily caused this, followed by the inability of Australia to produce its materials, which results in the sky-high price of importing materials.

For example, steel has a price increase that has left customers uneasy. The lack of iron ore production in China, upon which Australia depends for its steel-making material, further compounds already rising steel prices.

Other shortages include sand in the country’s southwest. Used as an aggregate for concrete, sand shortages cause supply chain distribution issues in the concrete industry that drive up the cost of houses. As a result, Australian building supply companies must increase their overheads that pass on to the customer.

Volatility of material prices

One of the most significant factors contributing to housing shortages in the market has been the volatility of material costs. In particular, there have been increases in the cost of lining walls, including the cost of sheetrock and gypsum sheets.

As the unpredictable nature of the global economy continues, with inflation biting hard, the cost of materials appears in a near-constant state of ebb and flow, which isn’t good for construction costs in any part of the supply chain – from the source to the end-user.

What are the cheapest building materials right now?

Concrete and concrete products represent the lowest overall increase in building materials in 2022. The average cement block price in Australia is $2.98+GST per unit.

The next-cheapest material is cement – with cement products making up only a 7.1% increase in material costs.

Producer Price Indexes (PPI)

What are Producer Price Indexes?

Producer price indexes are cost comparisons curated by the Australian Bureau of Statistics. The ABS releases this data annually to reflect the change in price from when a product leaves the manufacturer and begins its journey until it reaches the end consumer.

Key statistics 

A few key statistics encapsulate the current state of the Producer Price Index and give some idea of the state of the costs-of-production for multiple producers across the construction industry.

• Input prices have risen by 2.9% in house construction, which means that it costs, on average, almost 3% more to put products into building a home.
  
• Over the last 12 months, input prices have risen by 16% across the construction industry.
  
• Timber prices, board and joinery (wood product) have increased by 2.8%. Timber-framed windows have increased by 6.8%.
  
• Aluminum windows and doors are up by 3.8%. Meanwhile, other metal products have increased by 3.5%
  
• Plaster products have increased by 3.0%.

Building costs crisis and increased prices

Australians now face some of the worst building costs in the country’s history. And price increases are not set to slow down anytime soon. August reporting indicated that soaring building material prices caused house-building prices to increase by almost $80,000.

Shortage of materials

Material shortages contribute to this. For example, wildfires have knocked off native supply of basic building materials. This has caused losses of an estimated $600M worth of native timber, the building blocks of most Australian homes. Timber shortages have led to increasing costs for available product.

Other material shortages, such as previously mentioned steel have been blamed on the war in Ukraine, China’s economic downturn and the lack of iron ore mining. This has left Australian construction companies with no choice but to import steel, which has caused massive price increases to the end-users build cost.

Labour shortages

The new report, 2022 Arcadis Construction, predicts 100,000 unfilled skilled labour roles by 2023, and according to the Housing Industry Association, labour shortages will only grow worse. Other statistics indicate that Australia’s greatest skilled-labour need is construction management. The direst shortages in the industry are civil, electrical, mechanical engineers and surveyors – another critical part of the home building process.

How construction companies cope with price changes

Given that the country faces a considerable housing shortage and those building companies that haven’t been forced to shut down still need to do the work regardless, how are they coping with the exorbitant price changes in the industry?

Shop around

When you’re shopping for something and see a price you don’t like, you shop around until you find the product in a price range that works for you. Construction companies are doing the same.

Before, construction companies would have the luxury of choosing from domestic suppliers of certain materials. Things like PVC ceiling board pricing – made partially from gypsum, was previously created in Australia in the necessary quantities for demand. Unfortunately, like many other building materials, Australian construction companies must shop for the best price for their bottom line.

Minimise wastage

This has led Australian construction companies to seek new ways to use different materials and ensure that they order what they need for a job. Philosophies like “measure twice, cut once” are heavily employed on job sites to reduce material waste and rely on better technology to provide accurate measurements. This includes the use of technology such as digital blueprinting software.

Look for alternate materials 

Supply chain issues have made the use of commonplace materials sometimes impossible, so companies have had to get creative and use alternative materials that are more readily available.

Given the intense environmental impact of currently-popular construction materials, it’s no wonder that industries are looking for alternative ways to deliver to their customers.

Alternate materials can even be used for larger projects – with timber skyscrapers built from the inside out becoming popular in Australian cities, reducing the load on concrete and steel workers and their increasingly-strained supply chains.

Manage building material prices with software

To save vast amounts of time and money, Australian construction companies are also turning to technology to do their inventory of materials. Given that the computer doesn’t lie and doesn’t make mathematic mistakes, inventory management software represents the way of the future for Australian construction.

Buildxact is one such software, a construction management software uniquely designed for residential builders and trades to help them manage projects more easily.

Key features include job management with equipment tracking, profit insights, benchmarking, project scheduling and quote management; and Supplier Connection which allows you to provide faster quotes and win more jobs by facilitating faster collaboration and more accurate pricing.

Improve the accuracy of estimates

A construction company’s estimate can be the difference between its quote being accepted or rejected. Given that the company knows the state of the industry beforehand, it has to vastly improve the accuracy of its estimates to ward off competition. Given the industry’s material shortages, construction companies are going to ensure that their estimates are accurate and they’re not over or under estimating material cost.

Track costings

When cost is as unpredictable as it currently is in the Australian construction business, keeping track of every penny is even more important for businesses. This means utilising technology to track costings and make cost analyses of projects, before Australian construction businesses quote on projects.

“Pick your battles” seems to be the order of the Australian construction business at the moment. Every piece of material is itemised into a construction materials price list in order for companies to better keep track of their expenditures.

How much does it cost to build a new home in 2022?

Building a new home is a big task for construction companies and the prospective homeowners alike, but with the cost of materials on the up-and-up, it will cost somewhere between $1,300 and $3,900 per square metre, depending on the number of rooms and the cost of materials at the time – building material prices have risen more than 16% in the last year.

How to manage delays and shortages

Managing delays and shortages can be a real challenge for construction companies. Customers have paid them to deliver a specific product in a specific timeframe and if they’re late on delivering that end product – it doesn’t look good on their company’s reputation.

Due to rampant insolvency within the industry, builders left a record number of homes unfinished this year. The Australian Bureau of Statistics reported 241,396 unfinished homes in June of 2022.

Managing delays and shortages comes down to be honest with clients and crucially providing alternatives to their preferred building materials, if there is a significant delay in acquisition.

Will building costs go down in 2023?

There’s plenty of market uncertainty ahead in 2023, however, the pace of increased costs should slow down slightly, with decreases of between six, four and three percent in the Gold Coast, Melbourne and Sydney respectively. This flows from what some experts see as easing pressure on global supply chains and increasing stability to a construction industry starved of good news of late.

Learn more how software can help manage rising material building costs

Today, builders like you use modern software to keep up with the latest material prices. Buildxact offers an all-in-one platform for takeoffs, estimating, quoting and job management.

Learn more about Buildxact pricing, or begin working today with a Buildxact representative. Book a demo or start working with Buildxact right away with a 14-day risk-free trial.

The post What to expect from building material prices appeared first on Buildxact AU.

Augmented reality, digital representation, drones and battery-powered backhoes may make for interesting reading about technology trends, but it’s important for home builders like you to focus on the technologies that improve traditional home construction methods with little investment of your time and effort.

That’s why home builders, when evaluating the latest new construction technology, should first look at cloud-based job management software to better face the challenges of today’s home construction industry. 

Today’s challenges demand construction workers save time and money

You already know that rising material prices and labor shortages make the cost of doing business more expensive and complex. Home construction jobs simply take longer to finish when materials and the experienced trades needed to install them are in short supply. 

Working on a drawn-out job that may wind up losing you money is a tough spot all home builders and construction companies try to avoid.

As you realize a job might lose money, odds are as the weeks turn to months, your enthusiasm and ingenuity for the job will drop. This can lead to poor customer service and frustrated clients who can damage your hard-earned reputation. 

What is the role of technology in the construction industry?

The trick to working profitable jobs is to use technology to stay in your wheelhouse. You need to focus on the kind of construction job that matches the strengths of your home construction company. When you stick to your niche, you become better at finding the clients that your home construction team serves best. 

Of course, finding those clients requires proper marketing and networking, but ultimately, you also have to adopt a construction process that allows you to estimate and quote more jobs in less time so that you find the jobs that serve you best.

Accurately quoting more jobs using the right construction technology gives you the confidence to grow your business’ profits.

Also, many home builders use the quoting process to evaluate the nature of the potential customer as well as the job scope.

Discussing material and labor prices with homeowners often reveals red flags about the future client. People who excessively haggle your estimate or expect you to cut corners on quality may not be right for your business. When you are quoting more, you have the power to say “no” when the fit isn’t right for you. 

Builders like you are discovering the path to increasing their capacity to quote lies with modern job management software. Modern software designed for the home construction sector lets you learn a set of basic computer skills that do multiple construction management tasks from one software platform. 

Construction management software offers end-to-end improvement for your construction jobs

Successful builders in today’s market have a clear method for forecasting the cost to build a job. Once those costs are understood, the builder sends out professional quotes that quickly lay out all the tasks, labor and materials needed to finish the job.

Clear customer communication about costs and scope is one of the quickest paths to winning more jobs. Construction technology is then used to manage the job to its final completion and invoicing.

New technology in construction saves upfront admin time

Builders using modern software don’t lose hours behind a desk quoting and closing customers because modern construction technology serves as a one-stop-shop for takeoffs, estimating and quoting. In some cases, the time needed to do a takeoff can be reduced by as much as 80%. The software also offers customizable templates that make writing a quote letter a less time-intensive task. 

Construction technologies can ease planning complex jobs

Once you have the proper customers onboard, running your jobs smoothly helps turn a consistent profit and makes for a satisfied customer. Here again, new construction software can help. 

Today’s best software also offers scheduling and budgeting tools that you set up using your original estimate. This eliminates duplicative work and overly complicated spreadsheets that lead to costly errors.

Imagine scheduling tasks straight from your estimate so that you can see it all on a single chart. The best software allows you to set due dates and assign tasks by email all from the same platform, and this saves you the time and hassle of learning multiple apps or managing confusing spreadsheets.

Construction companies can schedule tasks more efficiently using technology

Once a job is up and running, you can adjust tasks with the click of a mouse and email your team updates quickly and easily. Having the right trades on your job sites at the right time is critical to running a successful job. 

When using modern technology, those successful jobs also pay dividends in the future. You can create templates from your most successful jobs so that you don’t have to start estimates and schedules from scratch with every job.

And because tracking actual costs is straightforward and doesn’t require confusing spreadsheets, you can track your actual costs to your original estimate to identify areas of your build that had unexpected price increases or needs better supply chain control.

With the right software you can create a cycle of continuous improvement that makes you far more efficient than using a traditional method of job management.

Modern technology enables greater supplier collaboration in the home construction industry

As home building become more challenging, builders and suppliers are collaborating more closely to meet the needs of the construction industry. Modern cloud-based tools are giving builders a way to communicate online with their suppliers so that quoting customers is not only easy but highly accurate. 

You know how frustrating unreturned phone calls and emails can be, especially when trying to talk to suppliers about basic things like material pricing and availability.  Waiting on unreturned calls leaves little time for true collaboration among home construction professionals.

How modern technology helps boost collaboration

Modern software makes all of this so much easier because it’s shared online within common workflows that eliminate the need to endlessly email or call your suppliers. Imagine sharing your job details with your supplier straight from the same platform that you used to build your estimate.

Now, imagine that the supplier has shared the material pricing with you in an online file that you can access at any time you need it—even from your construction sites. In some cases, data collected by modern software can offer material prices in real time.

This frees time for you and your supplier to collaborate on other things than pricing. A supplier can suggest different material options that you might not have considered that speed up your job without sacrificing the quality and performance of your build.

If you want to learn more how modern technology can help you work more effectively with your supplier, check out this resource.

Why do we need new technologies in the construction industry?

Many home builders put off learning new technology out of fear it takes too much time. However, with the latest home construction technology, it’s never been easier for construction managers like you to learn how to use construction management software. 

With the same point-and-click mouse and keyboard skills you use to surf the internet and use your favorite phone apps, you can learn how to quickly set up a customized account to perform digital takeoffs, material estimates and job schedules for all your construction jobs. 

To learn more, why not schedule some time with Buildxact? Or visit Buildxact’s website where you can learn how easy it is to get started with a low monthly subscription. Or start today with a free trial or demo.

The post Focus on new technology in construction to improve home building appeared first on Buildxact AU.

In this video, award-winning architect and builder David Pollard offers ways to reframe the negative thoughts customers can have about renovating. By better understanding your market and your customer needs, you can manage your customers’ expectations and face down these common renovation stigmas: 

1. The project will cost more than expected 

2. The project will take longer than expected 

3. Emotions get in the way of smart decisions 

4. The renovation cost is out of line with the property’s value 

5. The renovation cost is unfairly priced 

6. My renovation project will just make me miserable 

Renovators like you can combat each of these by clearly communicating your project’s purpose, scope, pricing and scheduling. 

To learn more about how you can use software to quickly create project estimates and schedules, why not book a demo with a friendly Buildxact team member? Imagine how much easier your customer conversations will be when you have all the material pricing and labor clearly listed.

For more details, check out Buildxact pricing, or begin working right away with a 14-day trial that is free to use.

David Pollard is co-founder of LivCo, a U.S. renovation company based in Illinois that has won multiple industry awards and recognitions since its founding in 2012. 

The post Break through customer renovation fears  appeared first on Buildxact AU.

In fact, one in three pro builders switch material brands at the time of purchase and make this decision increasingly via online ordering, according to a 2022 industry study from The Farnsworth Group.

With inflation expected to keep the cost of construction materials high well into 2023, builders will need to continue to advise their homeowner clients on how building materials impact the final cost to build their home. Builders having quick access to the latest pricing on new construction materials will have an advantage over their competitors when it comes to accurately quoting customers.

As you track the latest material trends, keep in mind that 66% of homebuyers rate sustainability as important to their purchasing decisions. Here are some of the product categories homeowners are likely to ask that you research and price in their quote:

New building materials for sustainable roofing  

Solar

Homeowners increasingly ask about rooftop solar panels as an optional material for boosting the sustainability of their new home. By 2030, about 13% of U.S. homes will have a solar photovoltaic system to generate electricity.

This is fueled in part by mandates that builders in some states need to be aware. For instance, in California, new single-family homes up to three stories must have enough solar generation to meet the home’s annual power needs. Builders can install smaller solar systems if battery storage or other energy-saving initiatives are part of the home’s design. 

Worldwide, other countries are adopting solar into residential construction at a pace largely based on local electricity prices and area weather conditions. In Australia, 31% of homes have some kind of solar system for generating power, and that country’s government hopes to grow the percentage to 50% by 2030. 

Solar panels have expensive upfront installation costs and can be tricky to finance with a mix of government incentives; so many homeowners interested in environmental sustainability opt for more traditional material choices. Included among these are:

Insulation

Renewable and recycled materials like sheep’s wool and denim are increasingly becoming options for insulation, but builders can consider certain plastics and spray foams because of their greater efficiency to resist heat and to seal leaks and drafts.

Radiant barriers 

Many custom home designs now call for radiant barriers beneath the outermost roofing material. Silver-colored barriers help reflect heat away from the attic, where the temperature rises as heat flows to the interior space from the outer building material.

Modern shingles and tiles

Homeowners are increasingly asking for more options beyond asphalt shingles, which are a byproduct of oil refining. Metal roofs do a good job reflecting heat, can be made from recycled material, and offer different designs using options like rugged, lightweight corrugated sheets.

Other composite building material made from recyclables like plastic and rubber mimic the appearance of shingles made from cedar, clay and slate. These materials come from naturally occurring resources but have drawbacks. Cedar is subject to mold and mildew, while clay and slate are both supremely durable but are heavy and difficult to install.

The wider construction material landscape

Concrete alternatives

Cement needed to make concrete for constructing buildings emits a large amount of carbon dioxide (CO2) during the manufacturing process. In fact, climate researchers say up to 8% of global carbon emissions come from concrete manufacturing. Alternatives to concrete to combat carbon emissions include ByBlocks made from plastic waste, bioconcretes like the one from Prometheus Materials that uses microalgae as a binding agent, and Ashcrete made from the byproducts of coal-fired power plants.

Other concrete advancements are helping reduce the overall need for the building material. For instance, there is bendable concrete, also known as Engineered Cementitious Concrete. Developed by a team at the University of Michigan departments of civil and environmental engineering, this fiber-reinforced material has greater strength than traditional materials.

Bendable concrete under extreme stress is better able to hold a structure, such as load bearing walls, without cracking because it can “give” in much the same way as plastic.

Another concrete advancement is self healing cement or self healing concrete. The idea behind self healing concrete is that naturally occurring proteins added to the material give the concrete the ability to form calcium carbonate. The calcium carbonate forms when exposed to CO2. The material fills the small cracks as they appear over time in concrete.

Redefined finishing materials 

Designers and builders commonly use wood, stone, brick and glass for the architectural finishes that give custom homes thier unique look. Increasingly homeowners are looking to materials like bamboo and cork for flooring and wall coverings and engineered quartz for countertops.

Because bamboo is fast-growing, requires little water, and can have the same appearance as wood, it also is an increasing option among engineered flooring products. 

The changing uses of steel and wood

Steel increasingly is becoming an alternative to aluminum and plastic when manufacturing doors and windows. Steel window frames and doors are stronger, do a better job insulating against moisture and can be made from recycled materials to reduce carbon emissions.

Because steel is energy intensive to manufacture and transport, the construction industry is looking for new ways to replace structural steel with lighter engineered wood building materials, know as mass timber.

One new thought is to use mass timber to replace steel and concrete support structures. Glue laminated timber can create support beams, and cross laminated timber forms strong building panels for floors and walls.

Yet another possible future use of wood is surprisingly in the manufacture of window glass. Transparent wood is made possible by chemically treating thin layers of balsa wood and is said to have greater insulation properties than traditional glass.

 Sourcing sustainable materials

Finding a trusted supplier of sustainable building materials can be time-consuming. It’s best to begin with your current network of suppliers to see what sustainable products they offer. Before researching and quoting with any reputable supplier, it’s best to know precisely the type and amounts of material you need for your project.

It’s important to know your project’s material counts before you request a quote because some suppliers have minimum and maximum order quantities when it comes to purchasing sustainable construction materials.

Be sure you have detailed plans from which to work. With modern construction estimating software, you can quickly perform a material takeoff to calculate all the various materials needed. With this in hand, you can then begin speaking to suppliers about sourcing materials.

Keep in mind that third-party organizations, such as the Forest Stewardship Council, certify timber and wood products to ensure manufacturers source in a manner that best prevents deforestation. Ask your favorite supplier if they provide these certified construction materials.

Supplier collaboration is key

As you can see, collaboration with your supplier is critical when purchasing sustainable construction materials. But supplier collaboration can help with all facets of your project.

Today, online software tools allow you to submit material quotes online so that you can have the latest pricing information without all the wasted time that comes from leaving unreturned phone messages and emails that get lost in the shuffle. 

When you hear back from your supplier faster, you can accurately quote your customers with a professional, detailed estimate that beats the competition.

Revolutionizing the Construction Industry

Today, home builders like you are using modern software as their go-to source for estimating. Buildxact offers an all-in-one platform for takeoffs, estimates, quoting and job management.

Learn more about Buildxact pricing, or begin working today with a friendly Buildxact team member. Book a demo or start working with templates right away with a 14-day free trial.

The post Learn how new construction materials impact today’s custom home projects appeared first on Buildxact AU.

Builders often struggle establishing this winning reputation because traditional estimating demands so much time. Understandably, builders don’t want to be pinned down by paperwork. They itch to be on the job site managing their teams and solving the daily problems that go with every build.

Successful builders have learned a trick for getting more time on the job site while also writing the estimates that grow their business.

These builders use estimate templates to simplify the preconstruction phase of their projects, leaving time to work directly with their home construction project teams. Having some free nights to spend with family and friends rather than writing estimates doesn’t hurt either. 

It’s easy to get started with free templates. You’ll find abundant samples on the internet that you can download and use to write estimates. But it pays to be careful. Using confusing spreadsheets or online documents can lead to trouble down the road.

More on that to come, but first let’s review some of the basics:

The benefit of estimate templates

Whether just starting out or well-established, builders need a thorough, accurate estimate. Estimate too low, and you lose money on a project. Estimate too high, and you may not win enough jobs to generate the cash flow you need to carry your construction company forward. After all, you’re in this to make money, right? 

Making money means more than covering your expenses. It means adding some extra income to give you a fair profit. Good builders know customers will pay for their expertise, and a detailed estimate explains the entire build package to the homeowner. 

The construction estimate covers all your labor and material expenses, overhead, permits and profit margin while delivering an on-time custom home project to the customer. Accurate estimates include all the tasks required to complete the job, from site prep to site cleanup, and give the homeowner power to make informed decisions on financing their project before you turn the first shovel of dirt. 

Finally, a clear estimate prevents misunderstandings down the road as the frame goes up and your subcontractors shift to different subtasks of the build, such as electrical, plumbing and HVAC systems. Builders with complete estimates often have to deal with less change orders.

Estimate efficiency

Now that you’ve reviewed the benefits of estimating, let’s turn to how you can do it quickly. To estimate quickly, builders like you use templates to save time.

Templates prevent you from starting from scratch when working similar projects. Whether it be single or two-story houses, or specific renovating or home extension projects, you jump start the estimation process using saved templates of your most successful jobs. 

Templates can list tasks and pre-price materials to avoid repetitive data entry that wastes time and leaves you open to making needless errors. More sophisticated templates, typically offered in construction estimation software, allow you to also pre-populate custom quote letters and generate basic construction project schedules to give your client a solid idea of a project’s length. With today’s labor shortages, having an estimate of cost and length of time is critical information.

Different types of construction estimate templates 

Estimate templates can take many forms. Builders swear by anything and everything, from notebooks scribbled with pencil, all the way to the latest cloud-based software. As mentioned previously, it’s good to be aware of the pros and cons. So let’s review. 

The tried and true ways of estimating a construction project

Obviously writing an estimate on paper is the basic way to get the job done. It’s especially tempting for experienced builders who, after years of working, have all the figures in their head. Sure, it may seem faster to just write estimates down from memory, but there are hidden hassles. 

First, you have to make a copy of your customer estimate for your own records, and then you have to file that in your office so you can find it later. And even if you find it months from now to use as a template for a new job with similar specifications, you then have to rewrite and update that estimate. Do you really have time to work so inefficiently?

Today, you have too many better options to notebooks and pencils that require less time and are more accurate.

The trouble with some free construction estimate templates

Spreadsheets and word documents offer a second way to use free construction estimate templates. No doubt you’ve seen these on the internet. Typically, they offer a free download with some basic instructions. 

Yes, these are better than writing things on paper. But You should keep in mind that free offers for estimate templates are typically just a way to rope you into a sales conversation about another, fee-based tool for construction projects. Free downloads typically require you to enter contact information and answer some questions that prequalify you to speak to a sales person so they can upsell you to another product.

Even when you put off the sales pitch and stick to the free products, there are hazards to using these spreadsheets and document tables. Typically, there are formulas hidden behind the rows of numbers that you enter. As a home construction business owner, you really need to understand what those formulas are calculating. You have to be sure what others have built for you is right for your business, and that can be time-consuming.

Also, a free construction estimate template is often isolated from other parts of your work. For instance, you have to perform material takeoffs as an entirely separate process and then copy the material counts into your spreadsheet. That leaves you open to make costly errors that can cut into your profit margin.

The same holds true for material prices. You have to take time to look up pricing from your supplier and then copy those figures into your spreadsheet or table. When you think about it, it could take days of emails and phone calls just to get those material prices. That’s just added delay and frustration.

Software offers a better construction estimate template

In today’s world of fast-moving labor and material prices, construction management software offers your best option for a construction estimate template.

Yes, there is a recurring cost if you subscribe, typically paid monthly. But the best software comes with a no-obligation trial period and ongoing subscriber support and service.

And unlike with free downloads, you know exactly what you are using because it’s explained in clear language and graphical interfaces that show you how labor and material costs are calculated.

Cloud-based software also allows you to either use standard templates that are ready-to-use once you login, or you can create your own estimate templates based on your favorite jobs. All of it is stored in one central place that you can access from anywhere that has an internet connection.

Because the best software is easy-to-use, builders can rely on it no matter how detailed the estimate or the type of estimate they want to show the customer.

Multifunction software offers more than cost estimation

But software does more than offer templates. It connects those estimates to digital takeoff tools and supplier catalogs that help you accurately estimate and quote customers 5x faster than with notebooks, pencils and confusing spreadsheets.

Takeoff software that’s included in the same monthly price calculates material counts from digital plans. No more hunting for plans on a crowded desk that you rarely have time to organize. With a simple point-and-click, material counts load directly into your estimate, which eliminates the manual errors that occur when copying figures by hand. And the best software also includes options for supplier catalogs and prices that ensure you are working with the latest information.

Learn more how software meets your estimate template needs

Today, builders like you are using modern software as their go-to source for estimate templates. Buildxact offers an all-in-one platform for takeoffs, estimates, quoting and job management.

Learn more about Buildxact pricing, or begin working today with a friendly Buildxact team member. Book a demo or start working with templates right away with a 14-day trial that is free to use.

The post Custom home builders earn homeowner trust with estimating templates appeared first on Buildxact AU.

In a slowing market for single-family homes, custom builders are reducing home prices to attract the fewer potential buyers that can afford today’s mortgage rates. As prices fall, home builders of all sizes find they can guard against money-losing projects even as the cost and complexity to build in the current construction industry remains high. They are getting the job done by strengthening how they identify and address construction risk management within their business.

Each stage of the build requires a different focus

Manage your construction risks early to protect profits 

For the client, building a custom home is a very emotional experience. Custom builders like you know that the most successful home construction project begins with clear expectations as to how long it’s likely to take and the costs that the homeowner pays along the way. Working with the homeowner as a trusted advisor makes decision making and the risk management process easier.

The best advice to provide the homeowner comes in the form of a clear and detailed quote at the very beginning of the build. This ensures that the homeowner understands the scope of work and the associated expenses because the detailed quote serves as the basis for the written contract. The contract is the common starting point when discussing any future disputes over variations.

Yes, homeowners are more likely in today’s economy to negotiate upfront materials to reduce construction costs, but you should always have processes in place when the homeowner changes their mind and asks for more expensive options on materials and appliances.

Document customer communication for greater risk control

Variations in particular present a significant project risk in an inflationary economy where material costs can widely fluctuate during the course of your project. Clearly documenting the impact of a variation on both the timing and budgeting of a home build is a great step toward mitigating risk and fostering greater client loyalty. Also, complex projects run more smoothly when financial documents are clear and easily referenced.

Accurately documenting costs does more than help you with potential homeowner disputes and strengthen your construction risk management. Upfront planning helps you ensure that you make money on your build. Clearly outlined costs help you manage your material and labor budget and calculate the right amount of markup to manage the financial risk your home construction business must confront in today’s economy. As you consistently document these expenses, you also learn to spot future opportunities for profitable projects.

As a project proceeds from the preconstruction phase and enters the build phase, you also should track your actual costs against your estimate to better understand how material costs can change over time. Using the right budget documentation, you will spot areas of future project risks—whether it be lumber, equipment rental or a labor cost associated with one of your tradies. 

Evaluate the safety of your team working at your construction sites

The health and safety of your team should be a primary concern when you think about risk assessment. Home builders like you constantly worry about the potential for injury or death. The list of trouble spots to look out for should be thoroughly reviewed on a regular basis with your team. As you know, a simple fall from a ladder can cause injury. Of course, the best way to face any safety risk is head on.

There are many online resources available to help you plan and prevent job site injuries but don’t forget—to begin planning against any type of safety risk, you must know who will be on your job site and when.

To understand this, adopt a clear schedule of job tasks as early on in your project as possible. Over the course of a build, you can have up to 20, 30 or more tradespeople on site at different times. It’s up to you to know when these different people will be at the job site and inform them of your risk management plan by having them attend regularly scheduled safety meetings. 

Include material management as part of your risk assessment

While employee safety at your construction sites is of paramount concern, proper scheduling also brings you benefits that help you reduce financial risk. By having a set, clear schedule you can ensure that the right materials are on site when your work team needs them.

Having to reschedule a subcontractor due to material delays or shortages can wreak havoc on your schedule. Subcontractors are often spread thin across multiple construction projects and can’t always quickly return to your project to finish a task on time. Also, unpredictable material prices could bust your budget if you have to make too many last-minute purchases and rushed deliveries. 

Software improves how you implement risk management for your business

Today’s economy of high interest rates and rising costs leaves little room for the errors that project managers can make when using pencil and paper. And when it comes to spreadsheets, and who has time to build or to copy all the custom formulas needed to estimate and quote your custom projects?

Top performing construction risk management software provides a single platform that tracks your projects from the earliest material takeoff to the final customer invoice. Administrative tasks that may have kept you pinned behind your desk take far less time using software, and it stores your documents in a single, online environment that keeps you organized and on track.

And today’s modern software also integrates your project budgets seamlessly with top accounting software like Xero so that keeping up with your financials has never been easier.

Ready to improve your risk management plan?

Have confidence that you can improve how you manage your home construction risk. Learn more how software can improve your construction risk management by visiting Buildxact. There you will find information about pricing and how you can sign up for a 14-day risk-free trial or book a demo of Buildxact. Speak to one of our expert team members and improve your risk management plan today!

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Builders know that demand for home construction remains. The global shortage of new housing units remains high, according to Goldman Sachs.

Also, builders like you have noticed, in response to recent developments, many homeowners now opt for a renovation instead of a new build. In fact, 79% of homeowners say they would renovate before buying a new home, according to a recent Discover Home Loans survey reported by Better Homes & Gardens.

With new home builds and renovations still in demand, builders need to be ready to estimate and quote jobs as quickly as possible. Successful builders know that to maintain responsiveness to the customer requires them to act as an efficient project manager. They must improve their overall efficiency and focus on specialized areas such as subcontractor management.

Builders need their labor networks to be ready and able to accept work and have the agility to steadily move from job-to-job. When doing so, you keep your subcontractor relationships fresh and avoid scrambling for skilled workers amid ongoing labor shortages. 

Subcontractor management processes and benefits

There are many tasks involved with building a home. Framing, painting and installing flooring are just a few of the jobs that benefit from a specialist. 

In most cases, as a home builder, you don’t pay benefits to a subcontractor to complete this type of work done. However, you still have job management issues to consider. You need to have clearly written terms and conditions that govern scope of work, safety standards, variances, compensation and worker protections for your construction project. 

You will also likely need to discuss with an attorney any subcontractor agreements that govern payroll taxes, liability and insurance. It’s important to get the negotiations right because subcontractor expenses often total three-fourths of the cost of a home build.

Also, in today’s market you need to properly plan and schedule the work done by subcontractors. You need to confirm subcontractor availability, and project materials need to be onsite when the subcontractor needs them. Any delays in one subcontractor task can throw off the schedule for subsequent contractors and work teams. It’s also important to remember that rushing to catch up on a schedule can compromise safety standards.

That’s why it’s important to always have a high-level view of the progress each subcontractor is making on the jobs assigned to them. The sooner you know a job is slipping from the agreed schedule, the quicker you can solve the problem so that it doesn’t impact all the subcontractors on your job site.

Finally, you need a centralized place to track and store subcontractor agreements, documentation of a subcontractor’s performance and subcontractor invoices. This is vital as you track costs against your budget. Keeping subcontractor costs under control is critical to maintaining your profitability.

Use the right software to improve subcontractor management

Document control

Today, builders like you need to spend more time on the job ensuring quality work proceeds as planned. You have less time for critical administrative tasks like takeoffs and estimating. Modern software helps cut administrative time because there is less paperwork 

Imagine not having to thumb through stacks of paper and files looking for important documents. With modern software, important subcontractor management documents can be stored centrally online for easy reference. Builders can also assign work orders to specific subcontractors to document expectations and deadlines. Work orders also can be used when it comes time to review a subcontractor’s work.

Job management

Once you’ve won a job and arranged for material and labor, it’s time to schedule your project. Keeping track of multiple subcontractors can be difficult and is particularly important as the length of time it takes to complete a home increases. Because of current labor and material shortages, it takes more than eight months to complete a home.

But modern software can help you manage this. Advance software allows you to create custom schedules directly from job estimates so that nothing is forgotten and all third party vendors are considered. You can store schedules for all tasks in one place where dependencies and progress can easily be monitored at both a high level and in detail using graphical software tools.

The best software also allows you to schedule jobs to specific subcontractors and notify those subcontractors contractors by email or text from the same tool.

Cost tracking

Of course, a critical part of your subcontractor management beyond scheduling is ensuring your supplier delivers quality materials to your job site on time and under budget. In this way, you are acting as the coordinator for all the trades needed for your home build.

Modern software again helps. You can access software tools today that create budgets straight from your estimate so that you can compare actual costs to your estimates. A single tool allows you to create work orders and receipts that directly connect to your budget so that you can have real-time updates as your project progresses.

Using the right software also saves you the time and hassle of importing data into different spreadsheets by connecting to widely used accounting software such as Quickbooks or Xero.

How to quickly improve your subcontractor management process

Whether just starting out or a seasoned veteran, builders like you need to constantly reassess your relationship with subcontractors and the tools you are using to manage these important resources.

Today, builders like you are more frequently turning to modern software to assist them. Buildxact offers an all-in-one platform for performing takeoffs, estimating material and labor costs and generating project schedules.

Learn more about pricing or begin working today with our friendly team at Buildxact. Book a demo or start right away with a 14-day free trial.

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This meeting—typically among you, the homeowner and architect—provides opportunity for the project team to ask questions and address concerns. Taking time to thoughtfully plan and prepare your home construction project saves you from numerous change orders and last-minute material substitutions and orders.

This meeting should take place soon after the homeowner and designer have drafted a scope of work and budget. As a builder, you want to discuss these two important documents to avoid signing on to an unprofitable project or committing to a schedule that you cannot meet.

You should also be careful when agreeing to jobs that have a lot of gaps in design detail. Negotiating projects like these often requires a cost-plus contract that carries a lot of administrative time for you to manage. 

With all this in mind, it may seem obvious to hold preconstruction meetings, but many builders neglect them. Let’s review why you should prioritize them.

Know the basics of preconstruction meetings

When planning your next preconstruction meeting, keep in mind three fundamental goals – review the job scope, define the job schedule, and optimize the budget and associated costs. 

Scope review

You need to review the project scope with your project manager, tradies and suppliers. This includes an onsite inspection of the construction site and confirmation that drawings have the detail necessary to determine what you can affordably build at the site. Additionally, you also need to ensure your dealer can supply all materials included in the specifications when needed.

Scheduling review

Accurate material deliveries depend on a detailed schedule. The project manager or general contractor needs to ensure the schedule maps out the availability of each subcontractor and trade team so that major components like trusses arrive to the construction site when needed.

This involves reviewing both internal project deadlines and project aspects as well as any external constraints. As a builder, it’s critical that you plan material deliveries with your dealer. Material shortages can cause you to miss the times when your tradies plan to be on your job site. You must remember to properly sequence work. No team should wait idle while material or equipment arrives to the job site

On average, material delays cost builders up to $5,000 per project.

Budget management

Having a preconstruction meeting will help your overall budget management. Expectations and dollar limits set beforehand ensure that all stakeholders remain informed of major milestones and their funding. This ensures proper cash flow to complete the project, and you lose no time to last-minute material substitutions. And remember, make sure the homeowner knows to approve all cost and material decisions for the entire project.

For example, it may be many weeks before interior work begins, but you and the homeowner must be clear on materials, associated costs and budget. You and the homeowner need to clearly itemize choices about doors, windows, flooring, paint.

When you do have to make changes, you raise your customer service when you use a system that easily incorporates costings, change orders and customer communication. Modern construction management software offers these capabilities typically at an affordable monthly cost.

Other benefits of a preconstruction meeting

Once you’ve agreed on the scope, schedule and budget, you have still other topics you can cover in your preconstruction meeting to boost productivity.

Set job site expectations

Throughout the job, you will be working with many different trades. Before a project starts you want to clearly establish quality expectations and explain to how your job site will run. You can discuss what time work crews should arrive and depart, safety procedures, and what clean-up should be done before a team leaves each day. Take the time to explain things clearly. Make sure everyone feels like engaged with the process.

Have transparency and clarity

It is important to be transparent with your team about your expectations and how they communicate to you. This means communicating your vision for daily operations as well as telling your team how they can provide regular feedback. Modern software designed for quick adoption by you offer features—like note tracking, online schedules and client portals—that make constant communication easy.

It is also important to be proactive in your communication and to keep everyone updated on the project’s progress. To be productive, it is important to have meeting minutes and notes that everyone can refer. Client portals make it easy to store notes and project photographs from a central location that everyone can access via laptop at your job site.

Avoid re-working jobs and costly delays

No one wants to constantly revise and re-do their work. This, of course, wastes time and money. As a builder you need to be on the job site supervising work, ensuring the right materials arrive as promised. Many builders like you use cloud-based construction software to cut down on administrative tasks that keep you pinned behind a desk. For example, integrated material supplier pricing, speeds up the time needed to submit orders with your preferred suppliers, and when needed, can the builder can place research orders from anywhere that has an internet connection.

Identify potential issues

Avoiding complexities and expenses during the construction process saves you money in the long run. Many builders find that learning how to use software tools like Buildxact makes them better builders.

Ready to learn more?

For more information about how construction management software can help you run preconstruction meetings, try Buildxact. Book a demo or free 14-day trial today!

The post For long-term success, invest in the preconstruction meeting appeared first on Buildxact AU.

Imagine a situation where the more you work, the higher chance your business goes bust. The problem becomes even more pronounced in periods of high interest rates, slowing activity and rising construction costs.

In spite of all of this, and no matter the urgency, for many home builders construction cost forecasting proves too time consuming. Others find forecasting difficult and don’t know where to begin. This doesn’t have to be you. Today, tools exist that make forecasting a simpler, more predictable process.

What is construction cost forecasting?

A construction forecast, or construction cost estimate, lies at the foundation of a profitable construction project. It contains project design, labor and material costs, while also outlining job schedules and any indirect costs that arise.

To create an accurate construction forecast, you must break down the project into individual tasks. These tasks have associated labor and material costs that you line item based on a takeoff. Once done, you have a forward view of costings and associated milestones. From this, you can create material deliveries and schedules for tradies.

With this information in hand, you now can consider the risks and associated indirect costs that often go unseen when a project first begins. For example, often the rising cost of living, inflation and associated pay rises are forgotten when costing. Working this out in advance gives you time to prepare. Now, you have an accurate construction forecast that you can clearly communicate to your client. More upfront client communication means less surprises and less change orders.

Further benefits of construction cost forecasting

Imagine knowing the profit margin of all the jobs you have planned and have under way. This can inform you on what additional jobs to take on and the ones to avoid. Picking the right projects for your business is critical to managing long-term financial risk. Other benefits include:

Cost control, not cost spirals

Making sure your project costs are under control and on track throughout the construction process is vital to keeping a budget. With cost forecasting, you can quickly spot overspending and make immediate changes. Very often, a basic lack of planning leads to going over budget. Whether they are direct (like labor costs) or indirect costs (like insurance or rent), you need to know your limits in advance.

Plan more, react less

Having a cost estimate makes for better-informed decisions. You may determine that the project plans are too ambitious or that the client’s preferred materials prove too expensive. With construction project forecasting and risk assessment, you also can determine if specific projects need to start at a particular time of the year—perhaps due to weather or the geographic location of the job. Well-constructed cost estimates will guide you in making the best decisions for you, your clients and your employees.

Cash flows, not cash crunches

Very few construction jobs, especially for builders like you, give you an unlimited amount of money at your disposal. With real-time data, you can pinpoint potential budget blowouts quickly. By ensuring milestones are met, you can be sure projects proceed as plan and their associated revenues come in as they were planned. The last thing you need for proper cash flow is to have payments withheld from dissatisfied clients.

Digital forecasting for construction projects

By now, you probably understand why forecasting is important. Today, modern tools are making this critical step easier than ever before. Here are a few examples:

1.    Let’s say you have an estimate for a small residential community. Because all 10 of the units are the same, you can prepare one detailed estimate and multiply that by 10 to calculate the overall cost. Today, you can use modern cloud-based software to help you create that estimate. The best software on the market integrates with your favorite material suppliers who can assist you. Your suppliers can ensure no critical items are missed because, in this case, mistakes are multiplied. Imagine having an estimate where you forgot to include interior doors. With five doors to each house, that is 50 doors that haven’t been budgeted. And because you missed the order, they may not be available when you need them. With modern software, you can avoid pitfalls like this.

2.      At other times you will have a single job that actually repeats something you did months or years ago. With modern software, you can easily use historical data to quote for the new project because software allows you to create templates from past jobs. The templates save you time because you don’t have to build a forecast from lost notebooks or a faded memory. The templates also give you the flexibility to make adjustments based on current events. Say, you realize you hadn’t considered how higher fuel prices have impacted material delivery costs or that labor shortages require a shift in your material choices. With modern software, making those changes to your original template are no trouble.

With this mind, take a look at Buildxact. The software makes estimating quick, easy and accurate.

Construction management software eases cost estimating

A good platform like Buildxact offers many benefits for small builders, construction companies and tradies. In one place you can:

• Perform your cost estimation 80% faster and more accurately;
• Communicate and collaborate with suppliers;
• Centrally store all project documents, information and change orders;
• Track job progression, tradies and laborers;
•   Integrate your accounting software and manage project budgets;
•   Access your projects from anywhere that internet connection is available.

With Buildxact, you will finish your construction cost forecasting much quicker. If you are not sure how the software can help you, why not try a 14-day free trial and see how Buildxact can help you develop better forecasts?

Good data, entered into good construction estimating and management software, propels your building business into the future. Don’t waste your precious time or money and get in contact with Buildxact today.

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