Level: Advanced
TCM Section(s):
7.3. Cost Estimating and Budgeting
7.6. Risk Management
Venue: 2023 AACE International Conference & Expo
Abstract: Recently, the Australian Institute of Quantity Surveyors (AIQS) commissioned a study of construction price data published by the Institute. The goal of the study was to gain a deeper comprehension of how the published data was used, and perceptions of its accuracy and value. This building price data has been published periodically by the Institute since the 1970’s, but there was not previously much effort expended to understand how useful the data was to members, and whether it was suitable for their purposes.
In order to conduct the research, cost data was gathered from The Built Environment Economist, a quarterly magazine published by the AIQS. The research itself was conducted in stages. A survey of users of the cost data (magazine subscribers) was conducted, the published one-year cost index forecasts were compared to the reliability of other trusted published statistics, and the one-year forecasted data accuracy was checked by building forecast models. The models used were based on commonly used forecast techniques (specifically, vector error correction (VEC) and exponential smoothing (ES)). Based on the study results, the research team identified key benefits and drawbacks of the published cost data, and identified for the AIQS several options for improving the published data product.
This research provides insight into the methods used to generate building price forecasts and is useful to individuals involved or interested in generating and improving the usability of published building price information. In particular, the study sought to understand what building price data end-users value most, and how cost engineers perceive the price forecast accuracy. The study also provides a fresh perspective on how building price data providers and their member/customers interact.
TCM Section(s):
7.3. Cost Estimating and Budgeting
7.6. Risk Management
Venue: 2023 AACE International Conference & Expo
Abstract: Recently, the Australian Institute of Quantity Surveyors (AIQS) commissioned a study of construction price data published by the Institute. The goal of the study was to gain a deeper comprehension of how the published data was used, and perceptions of its accuracy and value. This building price data has been published periodically by the Institute since the 1970’s, but there was not previously much effort expended to understand how useful the data was to members, and whether it was suitable for their purposes.
In order to conduct the research, cost data was gathered from The Built Environment Economist, a quarterly magazine published by the AIQS. The research itself was conducted in stages. A survey of users of the cost data (magazine subscribers) was conducted, the published one-year cost index forecasts were compared to the reliability of other trusted published statistics, and the one-year forecasted data accuracy was checked by building forecast models. The models used were based on commonly used forecast techniques (specifically, vector error correction (VEC) and exponential smoothing (ES)). Based on the study results, the research team identified key benefits and drawbacks of the published cost data, and identified for the AIQS several options for improving the published data product.
This research provides insight into the methods used to generate building price forecasts and is useful to individuals involved or interested in generating and improving the usability of published building price information. In particular, the study sought to understand what building price data end-users value most, and how cost engineers perceive the price forecast accuracy. The study also provides a fresh perspective on how building price data providers and their member/customers interact.