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00:00:00 – 00:07:36
The video discusses the concept of allowances in both residential and commercial construction projects, highlighting their role as placeholder values for items yet to be selected. Allowances provide flexibility for clients during material selection while enabling construction to proceed promptly. It emphasizes the need for realistic allowance values upfront to prevent unexpected expenses and clarifies that clients are responsible for any costs exceeding the allowance. The video underscores the importance of effectively managing allowances with contractors and architects to stay within budget and offers the option of a contingency fund for adjusting selections as needed. Overall, understanding and managing allowances is crucial for successful construction projects.
00:00:00
In this segment of the video, the speaker discusses the concept of allowances in construction projects. An allowance is a placeholder value for items that are yet to be purchased, providing flexibility for the homeowner during the selection process. The contractor sets an allowance for specific items, and if the actual selection exceeds the allowance, the homeowner pays the difference. Conversely, if the selection is below the allowance, the contractor issues a credit. Allowances commonly apply to flooring, cabinets, vanities, plumbing fixtures, appliances, and lighting. This system allows construction to progress without waiting for every item to be selected, accommodating varying client preferences.
00:03:00
In this segment of the video, it discusses the use of allowances in commercial construction projects. Allowances enable clients to delay material selection and allow contractors to initiate construction quickly. In renovation projects with structural damage, allowances can cover repair costs when the full extent of the damage is unclear. It emphasizes the importance of setting realistic allowance values upfront to avoid unexpected expenses. Clients should understand that if they choose materials exceeding the allowance, the additional cost falls on them, not the contractor.
00:06:00
In this segment of the video, the speaker emphasizes the importance of setting reasonable allowances with your contractor and architect when planning a construction project. They suggest sticking to the allowance during final selections but mention the flexibility of using a contingency fund to upgrade or downgrade selections based on the project progress. The key message is that managing allowances is a balancing act in construction, where staying within budget is crucial. The speaker explains that allowances act as placeholder values that can be adjusted as needed, either resulting in additional payments for more expensive items or credits for cheaper alternatives.