Dreams vrs. Reality is about this architectural firm being honest with its Clients about budgetary ranges of cost versus the widespread practice of simply doing what the Client says, only to have a major disconnect when the real prices are discovered.
What would you prefer? To have your Architect simply nod his/her head and say: “Sure, whatever you want,” to your every desire, with you imagining that all of those goodies are going to be included in your project for whatever lowball price you are hoping for, or have your Architect be honest with you from the beginning, devising creative strategies to empower you to make informed choices?
What does that mean, exactly? For this architectural firm (HOME ARCHITECTS®) it means: that they inform their Clients that the construction costs are increasing beyond their financial goals, whenever they ask for certain expensive features to be added to their projects. But they don’t want to destroy your dreams. So they have invented a creative Bidding procedure that separates the exotic (i.e.: expensive) items into an Owner Optional Upgrade bid list, while keeping the basics in a Base Bid package.
Does this mean that their Clients do not get what they want? No, it does not mean that. It simply means that their Clients will know, in advance of signing an agreement with their Builder, how much each of their higher-end features will cost to include in the project. Does anyone think that isn’t a good idea? Knowing what your “goodies” are going to cost? When would you like to know? Earlier or later?
What’s the alternative? What many architectural firms practice. And what is that? They simply include whatever their Clients ask for into the design and do Not separate the higher end features from the basics. In other words, their Clients are Not empowered with the knowledge of what their hoped-for, but budget-busting desires do to their costs? And then what happens? A lot of anger, shouting and dismay, on the part of the Client (on Bid Day).
Then: cuts. It has been the experience of this firm that it is a lot more painful to make cuts from a project during a financial crisis, than it is to carefully plan and design a basic project, with optional additional items, any of which can be added, if the Client so desires, if they wish to pay their Contractor to include those extra items.
In other words, this architectural company imagines their Base Bid Package like the “meat and potatoes” in a restaurant. Can you guess what the Owner Optional Upgrade list is like? You guessed it: the dessert menu. Once you have the main meal and know the costs for that, you can then decide if you have the economic appetite for dessert and how much. If you decide to pay for and consume the entire dessert menu, good for you! However, most Clients are always amazed at how much the Base Bid Package costs. This sobering pricing usually gives them pause, when ordering the extras from the “dessert” menu.
But: the Client is in charge: this firm has armed them with the knowledge of what each of their extras will cost (by having the Contractor price them in a separate list), rather than having a much larger number for everything all combined together and only seeing one huge price tag. What would you prefer? To have one big, dumb number? Or to have the intelligent breakdown of of the Base Bid and what each of the options costs? That puts you in the drivers seat.
Any Architect that does not manage the pricing in this manner, is, in this firm’s opinion, not providing essential information to their Clients. Early in the project, simply to make the Client happy then, they don’t have discussions about all the extras their Clients want, simply cramming them all into the design, without heed of the greatly increased costs involved. And that’s a disservice to their Clients.
Why? Because every Client thinks they are going to build their house, with whatever expensive features they want, for about 1/2 to about 1/3 of what the actual, real construction costs are going to be on Bid Day. Do you really think you are going to get a slate roof, heart pine floors, high-efficiency HVAC system, Wolf/SubZero appliances, cedar siding, decorative stone driveway pavers, exotic landscaping, large porches, and a 3-car garage for $100 per square foot? “No way, Jose’ ” as they used to say, back in the day. Maybe decades ago. Not today.
Some Architects believe they are “not supposed to upset their Clients” by “stepping on their dreams” by informing them that all of these goodies are never going to fit into their hoped-for budgets. This might, at first, seem polite and politically expedient. However, it is like lighting the fuse to a time bomb. When the Contractor’s price comes in around $200 to $350 per square foot (or more), months later, on Bid Day, chances are the Client is not going to be very happy. And, they are more likely going to be downright angry, getting red in the face and pointing to the Architect, and saying things like: “I told you I wanted to build our house for $100 per square foot!”
Then the Architect will say: “yes, but you asked for all of these expensive features, so I put them into the project.”
Then the Client replies: “Well, why didn’t you tell me that they were going to blow my budget?”
How lame at this point, is it for the Architect to then reply: “Well, you said you wanted those things and I didn’t want to spoil your dream.” Lame indeed.
Then the Client might say: “How lame is that? Why didn’t you simply tell me that all these things we wanted were too much for our financial abilities?”
Okay. Now we’re getting somewhere. HOME ARCHITECTS® doesn’t have this happen any more. It used to, but not now. Why? Because they inform their Clients from the beginning that their budgets are unfortunately, usually not realistic. This might temporarily upset them, but they then either do one of the following things:
COURSES OF ACTION
1). Increase their budget.
2). Not believe the Architect and plod forward (only to discover what the Architect said is true, months later).
3). Cooperate with the Architect, with the Architect assigning the basics to his/her Base Bid Package and the extras to the Owner Optional Upgrade package.
4.) Go somewhere else, mistakenly thinking that the Architect is the one who totally controls the construction cost, only to be severely disappointed when a Contractor finally provides the real price to build their dream house.
Let’s think about item 3). above: Does this in any way mean that the Clients can’t have the extras?
No. They can have any or all of the extras, as they wish.
Does item 3). above in any way provide less information to the Client?
No. In fact, it provides them with the most information possible about how much each of their dream items will cost to incorporate into the project.
Does item 3). make any of the Client’s hoped for “dream” items cost more?
No. In fact, because these extras are priced by each of several competing Licensed General Contractors on Bid Day, these options are priced in the most competitive circumstances possible.
Does item 3). mean that all of the upgrade items must be added?
No. The Client can select, one, two, three, all or none of them, as they deem appropriate for their budget and desires.
Now we need to mention something important: while just about any Architect knows when a project is going to blow a Client’s budget, they really should not be providing detailed cost estimates. Why? Because they are sure to be wrong. Why? Because an Architect is not a Contractor or a professional cost estimator. Architects deal with general ranges of costs, like $100/HSF (Heated Square Feet), $200/HSF, $300/HSF, $400/HSF and up. However, they really don’t know for sure (and neither will you) until one of your bidding Contractors provides their bid price.
Any Architect who provides a specific cost guarantee to build your project before you receive a quote from a Licensed Contractor is placing themselves in a highly libelous situation. For that reason, this firm doesn’t provide detailed construction cost estimates, nor any guarantee as to what your project will cost to build. However, they do know: when your desire for extras is exceeding your very low desired cost to build. And they do inform you of that. This is valuable information. Why? So that you can decide to take one of the 3 courses of action listed above. The only logical path is item 3). Why? There is no downside. It provides complete flexibility.
Okay, we have now revealed a dirty secret: your Architect really doesn’t control your construction cost and they also don’t really know the actual cost to build it until your Contractor signs their name in blood to a contract with you to build it. What really controls construction costs are…can you guess? YOU! And all those things you want! Don’t blame others for the price your Builder puts on your dream house. You’re the one who asked for all those features, size and materials. And you bought your land, with all those characteristics that make your project cost what it does. You did that. No one else. Be responsible for the choices you made.
Why don’t Architects know detailed construction costs better?
A. Because estimating construction costs is an extremely detailed process that takes hundreds of hours to research and to mathematically calculate.
B. Chances are, you aren’t paying your Architect to create a cost estimate, are you? So don’t expect one.
C. Costs are a moving target. They are constantly changing. Some costs change dramatically, almost overnight. Want an example? Not many people are aware that structural steel prices will be going up by about 33% during the next couple of months (spring-summer 2016). This information has not been published. Only whispers of it in the steel industry exist at this point and this is going to rattle this market sector hugely this year. In other words, not even most steel fabrication companies are aware of this right now, and anyone basing their construction costs on today’s steel prices are just about guaranteed to be about 1/3 too low during the coming season. This could mean a total price variation of hundreds of thousands of dollars (or millions) on a project that has a great deal of structural steel. The same thing could happen with wood, petrol-chemical products (which includes a large percentage of house construction materials), based on the price of a barrel of oil, which as we all know, can be very volatile.
How can Architects possibly be expected to be knowledgeable about such “insider” pricing information? They are mainly designing houses and buildings, not estimating their costs (that’s what Contractors do). So: it’s a question of specialization.
D. In this lifetime, it’s hard enough to become very good at one main thing. For Architects it’s DESIGN. For Contractors, it’s: PRICING and BUILDING. Contractors don’t make good designers and Architects don’t usually make good estimators or builders (unless the company is an integrated services Design-Build company).
However, any experienced Architect CAN tell any Client that when they indicate that they want to build their house for a lowball number (like $100/HSF), and that they want all-wood interiors, lots of stone outside, multiple fireplaces, multiple garage bays, huge kitchens and bathrooms, large porches, steep slopes and other features, that their budget is too low. See “Courses of Action” above. Telling a Client that their budget is too low, is not providing a detailed estimate. And there is not much liability in that. It’s simply being honest and providing very useful information. And suggesting that the Course of Action to follow in item 3), is really the only reasonable thing to do.
Which is why that’s exactly what this architectural firm does.
Is anyone out there offended that an experienced Architect knows more about construction pricing ranges than you (even though this doesn’t involve detailed estimating)? Are you offended that someone has informed you that your wanting to buy a brand new Porsche for $15,000 isn’t going to happen? And that you can’t even get a Chevy for that these days? That’s a pretty good analogy.
Consider item 3) in the Courses of Action. Only: very few Architects are familiar with doing things this way. Why: because they believe it offends their Clients to be told that all their goodies aren’t going to be included in their hoped-for price. However, they are missing the bigger point on Bid Day: your anger when you discover the truth from the Contractor. Would you really rather have a wimpy Architect that tells you: “sure, whatever you want?” only to have a major explosion when you get the Builder’s prices? Or would you rather have a forthright and honest Architect informing you up front what’s more realistic and having them assign the extras to a Options list and the basics to the Base Bid Package?
Painful: it is psychologically painful for owners to be faced with the realities of construction costs. The one thing that is usually true: whatever a future homeowner hopes their construction costs to be are often only 1/2 to 1/3 of what they will eventually end up spending to get what they want. See: Psychology of Construction Cost Denial.
Many Clients regard their Architect as all-knowing magicians who will make happen whatever they want. In terms of design, this is true. However, in terms of cost, it is not. The Contractor has to feed his family and his workers and material providers and he/she is not going to give away the “goodies” for free. They will also require a profit on those items and in fact on all of the aspects of your project. Why: because what they do has value. Does what you do have value? You certainly think so, don’t you? So have the same respect for your Contractor (and Architect).
This Architect believes it is irresponsible to not inform their Clients that their hoped-for lowball budget is not realistic. Even if it tarnishes their dream. Allowing your Client to live in a Pollyanna alternate universe until the realities of bids intrude is no favor. Which kind of Client are you? One who wants to delude themselves with fairy tales, then discover reality at a heart-breaking “Come to Jesus” meeting (on Bid Day) or who wants to know the truth from the beginning? This company is going to assume that its Clients want the truth. They will try to deliver this message as gently as possible, but will not sugar-coat reality as if somehow, some magical price-cutting Tinkerbell is going to swoop in and take away the big, bad, old costs and leave all the goodies. “Ain’t gonna happen,” as your Builder will say.
This architect is here to make your design dreams a reality. Construction costs are the department of your Builder and are based on what you want.
tags: Dreams vrs. reality, Cashiers, Atlanta, Sevierville, Columbia, Chapin, Hendersonville, Telluride, Aspen, Houston, mountain, post and beam, timber frame