A construction project is one of the most complex endeavors you can undertake. Sometimes, unexpected obstacles and circumstances can have a significant impact on the project’s overall financial plan.
While some construction cost overruns are unavoidable, it helps to note that some contributing factors can be anticipated and mitigated in time. With proper insight into these factors, you will be better equipped to manage these challenges and protect your rights in the event of a legal dispute. But can you foresee a construction cost overrun?
Here are common causes of construction cost overruns that you need to look out for.
Inaccurate project estimations
While most of the stakeholders might be eager to get the project up and running, if there are problems with budgeting and scheduling, then you can almost be certain that there will be an overrun down the road. Most budget and schedule problems happen during the tendering process when expectations are high. In fact, it is not uncommon for a contractor to present a one-size-fits-all estimation, and this can increase the odds of an overrun. Likewise, unrealistic timing and budgeting are potential red flags that the project is likely headed for an overrun.
Design errors
Even if adequate time and resources are set aside during the planning stage, design flaws can still cause problems. Design flaws can take the form of incomplete or incorrect plans – and both can lead to overruns.
Construction cost overruns are not only inconvenient and costly- They are also a leading cause of construction disputes. If you are caught up in a cost overrun that is not your fault, you deserve justice. Understanding how New York construction laws work can help you safeguard your interests in the event of a construction dispute that is attributable to cost overrun.