How to Review a Seattle Construction Budget Before Financing
A practical way for Seattle residential builders to check a construction budget for completeness, contingency, timing and carry before taking it to a lender.
Assemble the documents first
Most budget problems are visible before anyone runs a number. Put the whole package in one place: the proposed budget by cost code, the plan set and scope description, the schedule you expect to hold, the land or acquisition figures, any signed subcontracts or firm quotes, your soft-cost list, and your expected sales assumptions.
Then add the part builders often skip: the final job cost reports from your last few completed projects. A new budget is only as good as the history you can compare it against, and your own completed projects are the most relevant comparison you own.
Check the budget for completeness
Read the budget looking for what is missing rather than what is wrong. Common gaps on Seattle infill budgets include demolition, shoring or retaining, utility connections and any dry-utility work, temporary power and site protection, permit and review fees, testing and inspections, warranty or punch reserves, and selling costs at closing.
An exclusion is not a problem as long as it is intentional and written down. A silent exclusion becomes a change order later.
Test the cost assumptions against your own history
Take the largest four or five cost categories — typically sitework, foundation, framing, mechanical and finishes — and compare each against what those categories actually cost on your recent comparable projects.
Keep the comparison honest: same product type, similar size, similar unit count and a recent construction period. Also keep the square-footage definition constant. Comparing a finished-area figure against a gross-area figure produces a difference that has nothing to do with construction.
Look hard at contingency
Contingency should reflect the risk in this specific project, not a habit. A tight site with unknown soils, an older utility connection or a design still in flux carries more uncertainty than a repeat plan on a flat lot.
It also helps to state what the contingency is for. If it is meant to absorb unknown site conditions, then design changes and scope additions need their own allowance.
Build a timeline you would defend
Duration drives cost. Write down the periods you actually expect for design and permitting, construction, and the sellout or lease-up period after completion, and compare each against how long those phases really took on your last projects.
If your recent builds finished on time but stayed financed for months afterward, the sellout period is the assumption worth stress-testing.
Price interest and carry honestly
Carry is the line most often understated, because it depends on two other estimates: the draw curve and the duration. Model interest against a realistic draw schedule rather than the full loan amount, and continue the carry through the sales period, not only to certificate of occupancy.
Then run one downside case: the same budget with a longer sellout. If a few extra months of carry removes most of the profit, the project is a timing bet as much as a construction bet.
Prepare questions for your lender
Lenders and their programs differ, so treat this as preparation rather than prediction. Useful things to have ready: the budget with clear exclusions, your contingency logic, the schedule with its assumptions, a draw expectation, and your own completed-project history as evidence for the cost figures you used.
A Bivvit Budget Check is a review, not an approval. We compare the proposed budget against your own completed-project history and flag the assumptions worth another look before the budget is locked. Whether a project is financed, and on what terms, is your lender's decision. Tax and bookkeeping questions stay with your accountant.
Put It Against Your Own Projects.
Have a new project? Send us the proposed budget before you build it.
Check My Next Budget