Effective Control Of The Thinking Of China's Real Estate Project Cost

The project cost usually refers to the price for the project construction. From the investor, or the real estate owner's point of view, the project cost usually refers to the total investment on the entire fixed asset of the planned or practical expense on a project. To achieve the investment goal, the investor needs to plan and carry out the project, and also to manage all the investment activities until the competition of the project. The expenses for all of the afore-mentioned activities make up the project cost. In this sense, the constructions cost is the investment of the fixed asset on the project.The thesis begins with the function of the project cost concerning the increasing of the management level of real estate project, maximizing the investment interest, ensuring the project progress and quality, increasing the functional level of the building, and controlling the cost of the project life. Therefore it is significant in the overall cost control in the project construction.Based on the analysis on the current situation of the real estate and its problems, the author points out that the scientific decision-making is not attached importance to. The feasibility analysis is more of a superficial procedure. Other problems include: the realtors do not attach importance to the project design; the project invitation is not strictly regulated; the realtors do not attach importance to the contract management, and the construction site administration is not scientifically executed, etc.To solve those problems, the author states that: there should be a dynamic management of the overall project cost control. The author begins with the point that the overall project cost control refers to the starting of the estimated project cost in the project feasibility research, to the project administration including the confirmation of the project cost and the afterwards economic estimate. In the overall control of the project cost, the decision-making and project design are the key steps. Based on the scientific decision-making and the careful selection of the design, during all the steps of the construction, proper methods and measures should be adopted to control the project cost within a reasonable and predictable level. Also, the dynamic control refers to the construction period's influence on the project cost. Many elements concerning the project cost change from time to time, and this makes the project cost fluctuate in the construction process. The actual cost will not come out until the completion the project. In the construction, the project cost should be controlled in order to achieve the following goals: the investment control, the quality control, and the construction progress control. These goals are dynamic and they last from the starting till the completion of the project.Taking the construction sequences as the core, the author combines the theory and the examples, and offers an overall and systematic discussion on the effective control on the real estate project cost. The author also offers the solutions including: scientific decision-making, feasibility research, comparison of different designs, adoption of limited budget on each design, practice of invitation based on project items list, regulation of the bidding estimate procedure, scientific purchase, regulation of contract management, strengthening of the construction administration, the effective calculation upon the completion of the project, and setting up of the afterwards estimate policy.