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Originally Posted by Hape2Bhr
I understand RG's point, but KK's sounds closer to the answer I might be looking for. The actual reconstruction of the building only, seems as if it would be less than market value. Are there standard formulas for different grade reconstruction costs? Do insurers simply say buy this much and you will be more than covered in any loss?
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Generally, such cost formulas are based on square footage, kind of construction, and location. I doubt that information is publicly available on the internet. Commercial real estate appraisers and home builders in the area likely know that kind of information for one-off construction. Ordinary residential real estate appraisers probably do not know since they generally do their work only applying the ‘market approach’ of valuation looking at sales of similar homes. Construction costs involve both hard and soft costs. Soft costs can be substantial. Also, demolition costs might be relevant for your insurance decision.
Practically, a rule of thumb for construction costs of between A% and B% of market value might be good enough for your purpose without spending a lot of research time. (Rules of thumbs come with the usual caveats.) The link below might be helpful for your insurance decision.
ChatGPT - Estimating Home Construction Costs