How to Budget For Your Home Renovations
Sprucing up your home can involve simple paint jobs or a whole renovation. While paint jobs and other simple jobs don’t need much thought, renovation involves more jobs and a bigger amount of money. Because of this, it’s important to budget it properly. If you need help budgeting for a renovation project, here are tips.
1. A plan of action is a must.
A detailed plan is crucial to your renovation project’s success. Make sure to figure out all the details of the project from the most important to the smallest details, as it will determine how much you will need to spend on the renovation. Here are some factors you should consider:
Do you want to renovate your whole home or just certain parts of it?
The style you want for the renovation
The materials you want to use
The condition of your home
The size of the area being renovated
Your renovation priorities—make sure that you put them first before your wants.
The home’s value and the neighbourhood comparables, if you’re renovating your home for sale or investment
2. Figure out where you’ll get the money for renovation.
Now that you’ve got most of the essentials down, you should determine where to get the money. Is your savings enough or do you need to borrow? If you don’t have enough money to pay upfront, there are a lot of products available for home renovations in financial institutions. However, you should consider interest rates before you choose a product—remember that it’s part of what you will pay for in the next few years. Consider rolling it into your mortgage or in a secured credit line to ensure that you get the lowest interest rate possible.
3. DIY or Not?
This is a serious consideration because doing some parts or the whole project by yourself can lessen the costs of your renovation. However, if you don’t have skills or the time to DIY, let the professionals do their jobs. Doing it the wrong way can only lead to unnecessary expenses and can lower the value of your home.
4. Spreadsheets are your friend.
The organiser in you or your family will love this. Create a budget spreadsheet during the whole renovation process. Include the costs for everything—contractors’ payment, materials, paint, and the like. Doing so will keep track of all your expenses and show you where your money goes.
You can also create a spreadsheet for quotations of different contractors and materials even before the renovation process actually starts. Keeping quotations in one file will make it easy for you to compare and choose.
5. Don’t settle.
Ask around and get quotes from different contractors before choosing one to ensure that you’re getting the best deal. Make sure to check their reputations, ask a lot of questions, and check for hidden fees.
6. Prepare for the unexpected.
During the renovation process, mistakes and setbacks are unavoidable, so better prepare for them. Create an allowance in your budget for contingencies and mistakes. Allocate ten to twenty percent of your budget for a contingency fund. Including this in your budget will make sure that you won’t need to shell out more money and the project is still within your means.
Budgeting for a renovation project can be hard but seeing your visions for your home become a reality will make it worth it. Good luck on your renovation project! If you need more advice, don’t hesitate to send a message.