What is Component-Based Estimating?

Component-Based Estimating is a scientific, methodical approach to estimating that allows our clients the ability to value a building with limited construction knowledge. This process breaks down any building into its smallest pieces – referred to by CoreLogic as ‘elements.’ These elements fall into one of four categories: labor, materials, equipment and other (soft costs). Costs for each group of elements are collected and researched independently by our internal Data Collection and Construction Cost Estimating teams.

These elements are the foundation of our underwriting valuation products and are used to build up each property according to its specific features.

The first step to building a reconstruction cost is combining elements in various ways to create components. Components consist of no more than one building trade and the necessary materials and equipment to create a specific part of a building. For example, a component to frame a wall section would be made up of carpentry labor, materials like 2x4’s and nails, equipment like a hammer or nail gun, and soft costs such as the overhead and profit markups on the carpenter’s labor.

Components are used to create ‘Assemblies’ within CoreLogic® Underwriting | Residential Valuation™. Assemblies usually consist of multiple components. Continuing the wall section example from above, the wall framing component would be combined with a structural sheathing component built up with its own elements (carpentry labor, structural sheathing, nails, nail gun, soft costs) to create an exterior wall frame assembly.

Assemblies are used to create material selections. A material selection is created with one or more assemblies and refers to a selection defaulted by the program or selected by the user to capture a specific feature of a property. This may be the type of exterior wall, roof cover, or flooring. Continuing our example, to create a 2x4 exterior wall, the exterior wall frame assembly will be combined with an insulation assembly to create the total cost of the 2x4 exterior wall.

To create a total reconstruction cost, all material selections for the subject property are combined. In this way, component-based estimating provides the user total control over the reconstruction estimate by making sure the specific features of each property are considered. Component-based estimating creates the most accurate reconstruction costs because the reconstruction cost produced is based on the unique features of the property rather than simply assigning a generic square foot cost or using costs of comparable properties.