Theoretical Exploration Of Target Cost Control Of Real Estate Project And Its Practice

During the past more than ten years, the domestic real estate industry has experienced various changes of regulative system and operational mechanism. After having suffered so poignant market turbulence during 2008-2009, many domestic real estate enterprises understood that because the external circumstance couldn't be controlled by themselves, it is the unavailable approach to develop enterprises persistently by dimension-expending, famous branding and specialization. They seriously start to pay great attention to their internal business management. Among of the many measures of the internal business management, cost control, without question, is the most important activity. It is directly related to the business benefit of the enterprise.This paper, first of all, reviewed the development history of real estate industry in China and introduced its present situation. Following that, several theories regarding to the project cost control of real estate industry were summarized in the paper. The author pointed out that the domestic real estate enterprises are implementing target cost control method on their real estate projects at present and possibly in a longer period of the future. The present situation of the real estate project cost control in China and the weakness issues that prevalence currently in the enterprises were introduced and analyzed in the paper. On the above-mentioned base, the author of the paper combined relevant methods, such as whole process management, earned value method, value engineering, active and dynamic control and etc., with the engineering practices experienced by the author herself, and then studied the philosophy, the impacted elements of the target cost control of modern real estate project, and analyzed, one by one, the implementable measures for target cost control of the whole course of the project, which consists of 4 phases, i.e. from project planning and investment decising, designing, bidding and construction till final completion and taking over. Finally, with a case study, the construction of the real estate project in Guangzhou, Guangdong province, the experiences, weakness and improvement about cost control of the project were discussed in the paper. The research result about target cost control of real estate project in this paper would have a guidance and reference significance to other domestic real estate enterprises in a certain degree.