Top 5 Cost Risks in Construction Projects (and How to Avoid Them)

Construction projects rarely go over budget because of one big mistake. It’s usually a series of small issues that build up over time – unclear scope, late decisions, poor documentation, and optimistic assumptions.

Whether you’re an architect, developer, builder, or homeowner, understanding the main cost risks can save you a lot of money and stress.

Here are the top five cost risks we see in construction projects – and how to avoid them.

1. Vague Scope and Incomplete Documentation

The risk:

If drawings, specifications, and schedules are incomplete or unclear at tender stage, builders are forced to guess. Those guesses often turn into variations and disputes later.

Symptoms:

• “Provisional sums” everywhere

• Frequent “that wasn’t included” conversations

• Big differences between tenders for the same project
  

How to avoid it:

• Invest time upfront in clear drawings, specifications, and schedules.

• Use a detailed Bill of Quantities (BOQ) so all contractors are pricing the same scope.

• Avoid rushing to tender with half-finished information just to “get started”.
  

Where a QS helps:

A Quantity Surveyor prepares BOQs and checks documentation for gaps, so you reduce ambiguity and get genuinely comparable tenders.

2. Underestimating Early in the Project

The risk:

If the initial budget is based on rough guesses, outdated rates, or “rules of thumb”, the project can be in trouble before it even starts. Design decisions are made on the wrong financial assumptions.

Symptoms:

• Budget “feels” right but isn’t backed by detailed cost planning

• Significant redesign later to cut costs

• Clients shocked when real prices come back from contractors
  

How to avoid it:

• Get a proper cost plan prepared at concept and early design stages.

• Update the cost plan as the design develops – don’t treat it as a one-off exercise.

• Use current market data and realistic allowances for finishes, services, and contingencies.
  

Where a QS helps:

A QS turns drawings and ideas into structured cost plans, highlighting cost drivers and giving you realistic budgets before you go to tender.

3. Poor Tendering and Contractor Selection

The risk:

Choosing a contractor purely on lowest price – without understanding how they’ve priced the job – is a major cost risk. A low tender can hide omissions, underpriced items, or unrealistic assumptions.

Symptoms:

• Big spread between the lowest and highest tender

• Contractor submitting lots of claims and variations later

• Quality or programme suffering because the job was underpriced
  

How to avoid it:

• Use a structured tender process with clear documentation (drawings, spec, BOQ).

• Analyse tenders in detail – look for omissions, exclusions, and unrealistic rates.

• Consider value, capability, and track record, not just headline price.

• Clarify assumptions and exclusions before awarding the contract.
  

Where a QS helps:

A QS prepares tender documents, analyses returned tenders, and provides comparison summaries so you understand what you’re really accepting.

4. Uncontrolled Variations and Design Changes

The risk:

Changes during construction are normal – but if they’re not managed properly, they can quickly blow the budget.

Symptoms:

• Frequent “small” changes that never get costed until the end

• No clear record of what’s been instructed or agreed

• Final account significantly higher than the original contract sum
  

How to avoid it:

• Agree a clear process for variations before work starts.

• Get cost estimates for changes before approving them where possible.

• Keep written records of instructions and approvals.

• Regularly update the forecast final cost as changes are agreed.
  

Where a QS helps:

A QS tracks variations, assesses the cost impact, and keeps an updated view of the final forecast cost so there are no surprises at the end.

5. Lack of Ongoing Cost Control During Construction

The risk:

Even with a good tender, costs can drift if there’s no structured cost management during the build.

Symptoms:

• No regular cost reports or cashflow forecasts

• Interim valuations not checked against actual progress

• Client unsure where they stand against the budget at any point in time
  

How to avoid it:

• Put a cost management process in place from day one.

• Use regular valuations, cost reports, and cashflow forecasts.

• Compare actual costs to the original budget and investigate variances early.

• Keep communication open between client, architect, QS, and contractor.
  

Where a QS helps:

A QS values work done, prepares cost reports, and keeps everyone aligned on where the project stands financially – not just at the end, but throughout the job.

Bringing It All Together

Most cost problems in construction are preventable. The common thread across all five risks is a lack of clarity and control:

• Clear scope and documentation

• Realistic early budgets

• Structured tendering and contractor selection

• Managed variations

• Ongoing cost control during construction
  

A Quantity Surveyor’s role is to put that structure in place.

At Crawford QS, we specialise in residential construction and support architects, developers, builders, and homeowners across Dublin and Ireland with cost planning, BOQ preparation, tender support, and construction cost management.

If you’d like to reduce cost risk on your next project – or sense that your current project is drifting – get in touch and we’ll be happy to talk through your options.