Abstract:
The purpose of the study was to identify Factor Affecting Projects Cost Overrun on Real Estate Construction Projects the Case of Addis Ababa City. Specifically the study aimed at testing the relationship between the independent variables (owner related factor, economic factor, consultant related factor, factor related to contractures and Timeliness and financial factors) and the dependent variable (Projects Cost Overrun). This research was used both descriptive and explanatory research design because it enables the study to clearly investigate the characteristics and nature of the study undertaken and the cause and effect relationship with explanatory and dependent variables of the study. The target populations of the study are all contractors, consultants, clients of the Real estate construction projects in Addis Ababa making a universe of 557 to which 182 were sampled. The selections of respondents were made using stratified sampling technique. The data obtained were analyzed using quantitative and qualitative analysis techniques. Both descriptive and inferential statistics were used to see the factor affecting of projects cost overrun and following that logistic regression analysis were done. The result indicates that financial factor, owner-related factor and factor related to contractor had the greatest influence on the project cost overrun under study as the influence was significant at 5% level of significance. Based on the findings, it recommended that real estate project owners use strong auditing procedures and mechanisms of controlling financial diversion, they also give more emphasis on decision making and adequate budget management to make sure that the financial resource are used for the intended purposes, team work must required with the owner of project and others parts to exchange every additional cost and change of plans, the way of resource utilization and management which also likely to costs minimization and set proper feedback channels.
