There is a phrase you hear in every conversation about building work: it always ends up costing more. It gets said with a shrug, as though it were a law of physics.
It is not. Cost overruns have identifiable causes, and most can be dealt with before a machine ever enters the plot. The uncomfortable truth is this: budgets rarely blow up during construction. They are usually wrong from the outset, and construction simply reveals it.
1. The design was incomplete
By some distance, the number one cause. A design with unresolved construction details, half-specified services or inconsistencies between drawings and quantities produces an inevitable chain: during construction somebody has to decide how each gap is resolved, and every decision taken with work in progress costs more than the same decision taken at the drawing board.
The classic symptom is the variation order. It sounds like an unforeseen event. Usually it is not: it is a part of the design that was never resolved, being resolved late, with the builder already appointed and no competition to discipline the price.
A construction detail resolved at design stage costs nothing to correct. The same detail, resolved once the structure is built, can cost thousands. The cost of a decision rises steeply as work progresses — this is the fundamental principle behind project control.
2. The quantities were wrong
A construction budget is a list of items, each with a quantity and a unit rate. If the quantities are wrong, the total is fiction even when every rate is correct.
- Measurement error. The documents say 340 m² of flooring; the reality is 410. Nobody lied, but you will pay for 70 m² you had not budgeted.
- Provisional sums. A line reading "plumbing installation: €12,000 (to be justified)" is not a price. It is a placeholder. The real figure emerges once the work is done, which by definition means it cannot be negotiated beforehand.
The more provisional sums a quote contains, the less of a quote it is. A document with fifteen of them does not tell you what the building will cost. It tells you nobody knows yet.
3. The winning tender was too cheap
When you request five quotes and one comes in 20% below the rest, the natural reaction is relief. It is usually bad news.
Four companies in the same market, with the same suppliers and the same labour costs, cannot all be wrong on the high side. If one is dramatically cheaper, one of these is normally true:
- It has excluded items the others included, which will reappear later as extras
- It has measured less than is actually there
- It has cut margin to zero, expecting to recover it through variations during the build
- It has a cash-flow problem and needs the contract to fund itself, with the obvious risk to completion
A serious tender comparison does not compare totals. It normalises: every quote is brought to the same scope and the same quantities, and only then compared. It is tedious work, and it determines a large share of what the project finally costs.
4. Changes were made without being priced
This one is shared responsibility, and it happens on almost every project. You visit the site, see the space built, and ask for something reasonable: move a partition, change a tile, add a socket. The site manager says yes, no problem.
The change is not the problem. The problem is that it was not priced or signed before being carried out. Three months later a valuation arrives with fifteen accumulated changes and a figure nobody approved. Arguing at that point is awkward, and it almost always ends in payment.
The rule is simple and admits no exceptions: nothing is built without an agreed price and written approval. Nothing. Especially not the small items, because small items are what accumulate.
5. There was no contingency
Even with a good design, correct quantities and a solid contract, something will move. Rock in the excavation, a regulation that changes mid-application, a supplier who misses a delivery.
A professional budget holds 5% to 10% of construction cost in reserve for this. That is not pessimism, it is planning.
Skipping it does not avoid the cost. It means meeting the cost with no funding allocated — and since the money has to come from somewhere, it usually comes out of the final phase finishes, which is exactly the part you look at every day.
When each cause can still be addressed
| Cause | When to act | Fixable once on site? |
|---|---|---|
| Incomplete design | Before tendering | Very expensive |
| Poor quantities | Before tendering | No |
| Underpriced tender | At award | No |
| Unpriced changes | During construction | Yes, with a procedure |
| No contingency | When arranging finance | No |
Look at the right-hand column. Four of the five can only be tackled before construction starts. Once the excavator is on the plot, the room for manoeuvre on final cost is minimal.
Which is why the moment to bring in project control is not when something starts going wrong. It is before you sign.
At Mellado PM we review the design and the quantities before tendering, normalise the tenders so they are genuinely comparable, and put a change procedure in place so nothing is built without an approved price. It is not bureaucracy — it is what keeps the final figure close to the first one.
Before you go to tender
A second opinion on your quantities
Almost every overrun I have seen was already written into the drawings before anyone broke ground. If you have a project about to go out to tender, I will review the design and the quantities and show you where the builder will later claim variations.
The earlier it is caught, the cheaper it is to fix.