This concept is a technique that is applied in the preliminary stages of a development or building projects to assist in the determination for example, of the best materials to be incorporated in the development. Each item is considered in terms of initial cost, annual maintenance cost and its expected life span. Cost-in-use may be utilized in the decision process. Should there be a choice of development with many projects; cost planning cannot be fully effective, unless total costs are considered ie both initial maintenance and running costs. This technique is merely used to compare the financial implications of the use of different materials or systems in building over its effective life. It takes into consideration the initial annual and periodic cost which is reduced to an annual or a capital equivalent to make comparison, taking into cognisance time differences. It therefore becomes necessary to examine the various approaches and problems in application and its use in practical situations.
Cost-in-use is a single sum which is the annual cost-in-use or the present value of all cost over the life of a building. It is employed as a design tool for the comparison of different designs, materials and constructional techniques in the proposed development. It is a useful guide employed by property/project managers to compare cost against value accruing from future rents. Full consideration is taken of maintenance aspects and possible future costs at the design stage with an aim of securing better value for the money invested. The concept takes into account stream of varying payments which have to be converted into a common method of expression to permit meaningful comparison with alternative designs.
