Cost Overruns Risk Analysis from Construction Material Price Changes of Two-Story House in Chiang Mai Province

Abstract

When constructing a house, ones of the biggest problem is a price changes in overruns, which related on the uncontrol variables. The study shows variable that cannot control, which is a changes in cost of construction material price that will rise depends on the change of construction materials costs to prevent an increasing investment problem and an long period construction problem. This research objective aim to evaluate the cost overruns risk of construction material price changes in of two-story house in Chiang Mai province by collecting the bill of quantities in the construction and data of index price of material of five houses retrospect five years from Ministry of Commerce, then using Monte Carlo Stimulation on ModelRisk program to analyze. The results of this research are the evaluation of the cost overruns risk from two different example, two-story house in Chiang Mai province, when compared the bill of quantities and the variation of materials costs in each category show that the cost overruns period is 1.88% to 5.37%. The advantage of the research is to acknowledge the cost overruns risk of construction material price changes by using Monte Carlo Simulation for decision making and planning for house owners or contractors.