Forecasting residential building costs in New Zealand using a univariate approach

Construction cost index has been widely used to prepare cost estimates, budgets, and bids for construction projects. It can also be regarded as an indicator of cost level, which makes it valuable to public authorities for understanding the conditions in the construction industry. Accurate forecasting of future construction cost index is essential for construction industry at both micro- and macro-level. To improve the accuracy of the cost forecasting, time series modeling techniques are adopted in this study. The performance of the exponential smoothing models and seasonal autoregressive integrated moving average (ARIMA) models for forecasting the building cost of five categories of residential building (one-story house, two-story house, town house, apartment, and retirement village building) in New Zealand is compared. Exponential smoothing models can produce more accurate forecasts for cost series of the one-story house and two-story house in New Zealand, while seasonal ARIMA models outperform exponential smoothing models across the cost series for town house, apartment, and retirement village building. This study contributes toward the development of the current state of knowledge in the area of cost index forecasting for New Zealand and provides insights that should be valuable from the practitioner perspectives.

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Modelling Residential Building Costs in New Zealand: Time Series Transfer Function Approach

10.20944/preprints201903.0132.v1 ◽

2019 ◽

Author(s):

Linlin Zhao ◽

Jasper Mbachu ◽

Zhansheng Liu ◽

Huirong Zhang

Keyword(s):

New Zealand ◽

Transfer Function ◽

House Prices ◽

Residential Building ◽

Project Planning ◽

Arima Models ◽

Cost Estimating ◽

Cost Index ◽

Function Models ◽

Transfer Function Models

Cost estimating based on building cost index plays an important role in project planning and management by providing accurate cost information. Recently, tremendous advances in cost estimating has been made but serious inaccuracies in it are still too frequently witnessed. This study aims to improve estimating accuracy for residential building costs in New Zealand. In this study, the New Zealand house prices index is involved in the transfer function models to produce forecasts of building costs for one-storey house, two-storey house, and town house in New Zealand. To demonstrate the effectiveness of the proposed models, this study compares the estimate results of the transfer function models with the univariate ARIMA models. The results indicate that the proposed transfer function models can achieve better outcomes than ARIMA models by considering the causality between building costs and New Zealand house prices. During the modelling process, the better cost estimation approach can be identified, and the movements of building costs are shown.

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Determinants of Building Construction Costs in South Africa

Journal of Construction Business and Management ◽

10.15641/jcbm.1.1.84 ◽

2017 ◽

Vol 1 (1) ◽

pp. 8-13

Author(s):

Abimbola Windapo ◽

Sunday Odediran ◽

Alireza Moghayedi ◽

Abdul Adediran ◽

David Oliphant

Keyword(s):

South Africa ◽

Construction Industry ◽

Predictive Modelling ◽

Construction Cost ◽

Building Construction ◽

Construction Equipment ◽

Construction Costs ◽

Cost Index ◽

Cross Sectional ◽

The Cost

Completing project within cost is the target of most clients on any construction project. However, the achievement of this desire is just an imagination in the construction industry, because procurement and execution environments for projects are hostile and unpredictable. This study examines the determinants of building construction costs in South Africa and whether changes in the cost of certain resource factors such as construction equipment, labour and materials can be related to changes in building construction costs. The study employs a longitudinal cross-sectional quantitative research design approach and makes use of literature review and historical data obtained from institutional and governmental databases to identify the determinants. The data collected were analysed using time series analysis to confirm the trends in the cost of the resource factors and its alignment to the changes in building construction cost. After that, it makes use of an appropriate predictive modelling tool or causal analysis in establishing the determinants of construction cost. The results show that the price indices of construction equipment (EI), labour (LI) and materials (MI) have a gentler slope when compared with the Building Cost Index (BCI). It also emerged that later levels of the BCI are significantly and positively related to EI. The findings infer that the key determinant of increase in building construction costs in South Africa is equipment costs. Contractors and public or private sector clients in South Africa must utilize construction equipment optimally on projects, and these pieces of equipment should not be left idle on project sites or plant yards. Appropriate provisions should be made of equipment utilization policies which allow the joint ownership of equipment by contractors to mitigate the problems of cost increases. There are widely unexamined assumptions as to what resource factors are responsible for the growth in building construction costs in South Africa. Also is the similar high risk and uncertainty affecting the South African construction industry as a result of these fluctuations. The results of the study extend the knowledge of the resource factors responsible for building construction costs increases.

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Modelling Residential Building Costs in New Zealand: A Time-Series Transfer Function Approach

Mathematical Problems in Engineering ◽

10.1155/2020/7028049 ◽

2020 ◽

Vol 2020 ◽

pp. 1-18

Author(s):

Linlin Zhao ◽

Jasper Mbachu ◽

Zhansheng Liu

Keyword(s):

New Zealand ◽

Transfer Function ◽

Function Method ◽

House Prices ◽

Arima Models ◽

Cost Index ◽

Transfer Function Method ◽

Building Cost ◽

Function Models ◽

Transfer Function Models

Cost estimating based on a building cost index plays an important role in project planning and cost management by providing accurate cost information. However, an effective method to predict the building cost index of New Zealand is lacking. This study proposes a transfer function method to improve the forecasting accuracy of the building cost index. In this study, the New Zealand house price index is included in the transfer function models as an explanatory variable to produce cost forecasts. The proposed method is used to estimate the building cost index of residential buildings including one-story houses, two-story houses, and town houses in New Zealand. To demonstrate the effectiveness of the proposed method, this study compares the cost forecasts generated from the transfer function models and the autoregressive integrated moving average (ARIMA) models. The results indicate that the proposed transfer function method can achieve better outcomes than ARIMA models by considering the time-lag causality between building costs and New Zealand house prices. The proposed method can be used by industry professionals as a practical tool to predict project costs and help the professionals to better capture the inherent relationships between cost and house prices.

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Comparative Cost Estimation of Residential Building

International Journal for Research in Applied Science and Engineering Technology ◽

10.22214/ijraset.2021.37847 ◽

2021 ◽

Vol 9 (8) ◽

pp. 2735-2739

Author(s):

Prof. Amit Kale

Keyword(s):

Construction Industry ◽

Cost Estimation ◽

Construction Management ◽

Research Effort ◽

Construction Project ◽

Residential Building ◽

Construction Cost ◽

Building Construction ◽

Estimation Methods ◽

Comparative Cost

Abstract: A construction project of any building is mainly based on 3 important steps that are planning, Cost Estimation of the building and proper execution of construction of the building. Construction cost estimation has the lion’s share of the research effort in construction management. The Objective is to analyze the effectiveness of various cost estimation methods by comparing traditional and various online websites. This study will provide more accurate estimates that save time and minimize errors. The research conducted will be helpful for estimation of construction, also proving how the introduction of IT sector in construction industry is turning out to be beneficial. Keywords: Estimation, Construction Management, Online Websites, minimize errors

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REASONS FOR FAILURES IN INSPECTION REPORTS FOR RESIDENTIAL BUILDS

Proceedings of International Structural Engineering and Construction ◽

10.14455/isec.2020.7(2).con-29 ◽

2020 ◽

Vol 7 (2) ◽

Author(s):

John Tagiilima ◽

Funmilayo Ebun Rotimi

Keyword(s):

New Zealand ◽

Construction Industry ◽

Residential Building ◽

The Other ◽

Building Performance ◽

Data Set ◽

Housing Shortages ◽

And Performance ◽

Preventative Approach

The construction of multi dwellings is currently a focus of the New Zealand government to address housing shortages. The intention is to build en masse whilst also keeping the buildings affordable. Affordability is not expected to compromise on quality and performance of new builds. New Zealand has a strict regime for building compliance, which helps to maintain standard of building performance. However, despite this, some buildings fail inspection during construction. There is limited understanding on the reasons for such failures. Therefore, this paper aims to provide a clear and concise understanding of why and how residential building inspections fail. The study investigates the reasons behind failed inspections by analyzing 146,000 inspection reports. The report used for the study cover January 2013 till June 2016. The data set was obtained from a major urban council in New Zealand. The results identified two key reasons for failed inspections. One is technical in nature and the other administrative, which both Council and builders must work collaboratively to achieve common compliance objectives. The study provides the construction industry with important insights into the reasons for failure of building inspections to serve as a preventative approach to non-achievement of expected residential building qualities.

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Discussion on Design Control and Management of Construction Cost

Architecture and Design Review ◽

10.18282/adr.v2i1.1076 ◽

2020 ◽

Vol 2 (1) ◽

pp. 13

Author(s):

Mengli Li

Keyword(s):

Construction Industry ◽

Cost Control ◽

Cost Management ◽

Construction Project ◽

Construction Cost ◽

Economic Benefits ◽

Management Measures ◽

Pillar Industry ◽

Control And Management ◽

The Cost

<p>As a pillar industry in China, the construction industry is developing rapidly at this stage. In order to better promote the development of the construction industry, it is necessary to reasonably ensure the economic benefits of the project and do a good job in the cost management of the project. Based on this, this paper analyzes the construction cost control and management measures, aiming to take effective measures to control the construction cost and promote the better development of the construction project.</p>

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Energy Management through Cost Forecasting for Residential Buildings in New Zealand

10.20944/preprints201906.0099.v1 ◽

2019 ◽

Author(s):

Linlin Zhao ◽

Zhansheng Liu ◽

Jasper Mbachu

Keyword(s):

New Zealand ◽

Energy Management ◽

Energy Use ◽

Residential Buildings ◽

Residential Building ◽

Close Correlation ◽

Household Energy ◽

Building Cost ◽

Retirement Village ◽

Household Energy Use

Over the last two decades, residential buildings have accounted for nearly 50 percent of total energy use in New Zealand. In order to reduce household energy use, the factors that influence energy use should be continuously monitored and managed. Building researchers and professionals have made efforts to investigate the factors that affect energy use. However, few have concentrated on the association between household energy use and the cost of residential buildings. This study examined the correlation between household energy use and residential building cost. Analysis of the correlation between energy use data and residential building cost indicated that residential building cost in the construction phase and energy use in the operation stage were significantly correlated. These findings suggest that correct monitoring of building costs can help to identify trends in energy use. Therefore, this study proposes a time series model for forecasting residential building costs of five categories of residential building (one-story house, two-story house, townhouse, apartment, retirement village) in New Zealand. The primary contribution of this paper is the identification of the close correlation between household energy use and residential building costs and provide a new area for optimize energy management.

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Revisiting storey enclosure method for early estimation of structural building construction cost

Engineering Construction & Architectural Management ◽

10.1108/ecam-07-2015-0111 ◽

2018 ◽

Vol 25 (7) ◽

pp. 877-895 ◽

Cited By ~ 4

Author(s):

Chau Ngoc Dang ◽

Long Le-Hoai

Keyword(s):

Regression Analysis ◽

Residential Building ◽

Construction Cost ◽

Design Parameters ◽

Cumulative Probability ◽

Range Estimation ◽

Building Projects ◽

Content Type ◽

Enclosure Method ◽

The Cost

Purpose The purpose of this paper is to develop several predictive models for estimating the structural construction cost and establish range estimation for the structural construction cost using design information available in early stages of residential building projects. Design/methodology/approach Information about residential building projects is collected based on project documents from construction companies with regard to the design parameters and the actual structural construction costs at completion. Storey enclosure method (SEM) is fundamental for determining the building design parameters, forming the potential variables and developing the cost estimation models using regression analysis. Nonparametric bootstrap method is used to establish range estimation for the structural construction cost. Findings A model which is developed from an integration of advanced SEM, principle component analysis and regression analysis is robust in terms of predictability. In terms of range estimation, cumulative probability-based range estimates and confidence intervals are established. While cumulative probability-based range estimates provide information about the level of uncertainty included in the estimate, confidence intervals provide information about the variability of the estimate. Such information could be very crucial for management decisions in early stages of residential building projects. Originality/value This study could provide practitioners with a better understanding of the uncertainty and variability included in the cost estimate. Hence, they could make effective improvements on cost-related management approaches to enhance project cost performance.

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