What is meant by “Allowances”?
An estimate is based on an allowance for a specific cost. For example to determine the cost of an addition an item would be the foundation. A cost allowance of $10,000.00 may be assigned for this, if an engineer determines the concrete should have an extra strength rating, or special fiber’s inserted or even larger rebar inserted this would put the foundation over the Allowed price. Also changes in customer desires can excede allowances. A regular basement bathroom may cost $7,000.00 when a customer changes to a jet soaker tub, or granite tile floor with infloor heating, this would impact the estimated price and generate a higher cost. Most estimates a very close to the final pricing but a 10% to 20% margin should always be allowed for.
