Revaluation of construction projects using statistical data

conference paper

English

The decisive parameter of every project is its price and its adequacy to the expected benefits. The investor decides whether to implement the project or withdraw from it based on its calculation. He makes a so-called investment decision. The planned goal of the project and its duration are relatively constant parameters. The most expensive part of a construction project is the construction work implementation. The price is determined by the budget, that is, by valuing the bill of quantities of individual structures and works. Many months or years can pass between the moment of the construction appreciation and its actual implementation, especially for large projects. The current price of resources used at the time of implementation is affected by the fluctuation of the price level, especially of building materials and built-in products. Therefore, the final price of the construction project may differ significantly from the budget price. A suitable tool for the correct determination of the price of the construction structure and works implemented is the adjustment of the budget price by multiplying it by a coefficient that reflects the price level development - the so-called price index. The use of a reliable source of indices ensures that the investor does not overpay for the project (the price is not excessive) and that the contractor does not lose money (makes the expected profit). In the Czech Republic, the Czech Statistical Office calculates and publishes quarterly price indices for construction structures and works. The contracting parties (the client and the contractor) may agree on the exact conditions for the use of price indices in the construction contract. This concerns in particular their structure according to the classification used and the determination of the time interval between the budget calculation and the invoicing for the work carried out. The article describes the methodology of surveying construction work prices and calculating price indices by the CZSO and the structure and periodicity of their publications. Furthermore, a method of using price indices to update billing prices is proposed. The development of the prices in the last few years is shown in the examples of specific construction structures. The paper is extended by the results of a questionnaire survey in construction companies aimed at finding out whether and how they use construction price indices.

Revaluation; Construction; Contracting

NOVÝ, M.; NOVÁKOVÁ, J.

27. 9. 2023

AIP Publishing

Melville, USA

1551-7616

AIP Conference Proceedings

2023

2928

United States of America

1

8

8

https://pubs.aip.org/aip/acp/article/2928/1/070003/2913211/Revaluation-of-construction-projects-using