How much is the construction cost per square meter of the building? – Tejarat News

According to Tejarat News, the most accurate estimate of the building construction price was announced by the private sector in 1402. This estimate shows that there is a huge gap between the calculations and estimates of the government institutions of the construction cost with the estimate of the private sector, which has become a problem for one of the occupational groups active in the housing market, namely architects and urban planners, and has provoked their reaction.

On the surface, it may seem that the housing market is one of the few markets where the government’s mandated pricing is not valid and only supply and demand in this market determine the price. The purpose of the government’s price intervention in the form of an order is to set a price lower than the actual costs of producing a product and a minimum profit margin for producers. This is the procedure that the producers of various goods and services in the country are facing and it is always criticized by the private sector. But the conditions of the housing market seem to be different in that the total pricing authority is with the owners. This is despite the fact that even this market has not been exempted from mandatory pricing.

The amounts are in millions of Tomans:

The story is that the institution related to determining the qualification and salary of supervising engineers, which is in some way dependent on the government, determines coefficients of the housing construction cost as the salary of supervising engineers every year, and in practice, with this action, it is a form of mandatory pricing. enters the housing market. In other words, the salary of supervising engineers is a coefficient of the finished price of housing construction in each year, which is estimated at the beginning of the year by the relevant institutions and based on the adjustment coefficients of construction costs announced by the Planning and Budget Organization.

In recent years, this estimate has almost always, without exception, been far from the actual level of the construction cost, and because the fees of the supervising engineers were announced based on a percentage of this cost, practically the hands of the supervising engineers also remain far from the fees they deserve. The rule of this trend has caused that in all the past years, the supervising engineers of construction projects do not receive wages commensurate with the quality of their professional services, and this sensitive and valuable job is considered by the government as a second and side job. The fact that the basis for determining the salaries and wages of supervising engineers has always been set incorrectly and unrealistically, and following the shrinking of housing construction costs, the wages of these engineers were calculated at a lower level than what should have been calculated, which had caused the supervising engineers to look for another job in addition to this profession. Even this process has sometimes had a bad effect on the quality of construction. But despite the fact that there has always been a gap between the actual construction cost and the estimated construction cost and announced by the government institutions, this gap has now reached the highest level that has not been experienced before, and this is the reaction of the Association of Consultant Engineers and Architects. “Shahrsaz” has followed.

As a private sector active in the construction industry, two days ago, in a letter addressed to the head of the country’s building engineering system organization, the trade association of architects, consulting engineers and urban planners reacted to the government calculations of the cost of housing construction and announced another estimate of this cost variable. Is. The proposal of this association is to include this estimate in determining the salary of consulting engineers.

In the content of this letter, it is mentioned that according to some tables announced by the engineering system organization of different provinces and observing figures that are inconsistent with the operational realities of building construction, a table of construction costs has been prepared by the aforementioned association in order to prevent confusion and unanimity in the organization. The building engineering system has been sent. According to the estimate of this private sector organization, the cost of building housing for medium-sized and conventional buildings in the country, which is neither very cheap, low-quality, nor luxurious, for a four-story building, which is the norm for building density both in Tehran and in the country, is 12 million and 500 thousand square meters. Toman is estimated. This is despite the fact that according to the announcement of May 4, 1402 by the Construction Engineering System Organization, the current annual construction cost for one and two-story buildings per square meter is 4 million tomans and for three to five-story buildings 4 million and 665 thousand tomans was calculated and announced. In this way, the expert figures of the consulting engineers about the cost of building housing is 2.7 times the engineering system, and this big gap was not something that the consulting engineers could ignore this year. Therefore, they put the official reaction by sending a letter and announcing their calculations of the construction cost on the agenda; Hoping that the said process will be corrected.

It is worth considering that in addition to the cost of construction, there are a number of other side costs in construction projects that are effective in the finished price of housing construction. Non-building insurance, head office cost, continuous workshop cost, warranty, profit and profit tax are among these things that should be included in the final price. Including these overhead costs, a factor of 1.43 should be considered for the initial estimate made by the consulting engineers, in which case the actual cost of building a four-story building will increase to 17 million tomans per square meter.

It is important to mention that the price of land is not included in the calculation of housing construction cost and it is only related to the construction cost. Although these figures have been announced as national estimates, it is said that their level is very close to the level of construction costs in Tehran, and of course, different cities and provinces sometimes have price differences with these announced levels. In the calculations made by the private sector, the cost of building a building with 5 to 10 floors is 14 million, 11 to 16 floors is 18 million, and 17 floors and more is estimated at 22 million tomans. This is despite the fact that a month ago, in a table, the Engineering System Organization estimated the cost of building a 6 to 7-story residential building at 5 million and 300 thousand tomans, 12 to 15 stories at 7 million and 300 thousand tomans, and announced that the cost of building a residential building above that would be 8 million tomans. had done that it is far away from the figures estimated by the relevant organization in the private sector.

The fate of mass builders of government housing

How the government and relevant institutions react to the recent letter of the aforementioned association regarding the cost of housing construction in 1402 is also very important for the stakeholders in the implementation of the government’s one million housing project. In the last negotiations between the mass builders and the government, the effort of the mass builders participating in the implementation of the National Housing Movement Plan was to increase at least the cost of construction in the current year’s contracts by 10 million tomans. But why does the government resist accepting the reality of the construction market? The answer is clear. The government’s effort is to build one million housing units annually at the lowest possible cost and allocate them to the homeless. But the housing sector policymaker should not neglect the fact that erasing the face of the issue of real construction costs can have far worse consequences than accepting real estimates. The least consequences of the government’s resistance to accepting a reasonable level of construction cost in the contracts of the National Housing Movement is that the units whose construction has started are left half-finished or their completion is subject to time and consequently subject to higher inflation. The experience of the past years of mass housing construction by the government also showed that it is possible that the life of a project of this size will increase to the age of five consecutive governments.

The only reasonable way for the government is to accept the inflation that affects construction costs as a market reality and then try to find a solution for this inflation, rather than using the tools at its disposal to minimize this important and key expense in the housing sector. to pay

The government’s agenda to reduce construction costs

Expert surveys show that the major part of the significant growth in the cost of housing construction in the current year is due to the high inflation of construction materials, and the contribution of construction workers’ wages is less in this matter. In this way, the government should focus on curbing the inflation of construction materials and thus prevent the growth of construction costs in the coming seasons of 1402. Managing the supply of materials for government mass construction projects on the one hand and curbing the rampant inflation of construction materials on the other hand is effective in reducing tension in the construction activities market. Experience has shown that during periods of stability in the building materials market, housing construction has flourished and builders have shown a greater desire to be active. Therefore, instead of insisting on estimates that contradict the reality of construction costs, the policy maker’s agenda should be to establish stability in the construction materials market by reducing the costs of materials producers.

Warning about the future of construction

There is also a warning in the recent letter of the Association of Consulting Engineers, Architects and Urban Designers. Consulting engineers have warned that their salary base is one-third of what they are facing in reality, and if this gap is not paid attention to and repairs are not made, it is not unlikely that the stagnation of housing production will lead to the exit of the private sector such as construction companies and architects and urban planners from the housing market. Leads.

It is said that some construction companies have gradually left this market during the general recession of the construction market in the country in recent years and focused their activities on oil and petrochemicals. Also, some construction companies are bought by banks, and this means that the exit of this group of specialists from the housing market has already been keyed.

If the predicted conditions for architects and urban planning specialists as supervising engineers in the housing market do not improve, in the coming years we may face a serious shortage of experts in the field of housing construction supervision, and the effects of this phenomenon on the quality of construction are evident in the medium and long term. will be. In other words, even if the widespread stagnation in the housing market is cured and this difficult situation of several years ends, it may not be possible to benefit from the capacity of the community of consulting engineers as it should and maybe during the construction boom.

Source: the world of economy