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Soft Costs
By Contributor on February 5, 2019
Soft costs are cost related items to the construction of the property that are not associated with the structure, but nevertheless incurred during the construction project.
They are also sometimes referred to as indirect costs.
You need to know:
What lenders hope you never learn about mortgages
Soft cost expenses include services and expenses like:
- Legal fees
- Architectural fees
- Taxes
- Financing costs
- etc
A good metaphor is to compare soft costs with software costs for computers.
A user will have to spend money on hardware and software.
The money spent on software is the soft costs.
They cannot be physically seen unlike raw materials, but plays a critical role in the function of the whole project.
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