How to Stick to Your Budget When Remodeling

The first thing that comes to your mind when first deciding the renovate your home is how much the project costs.

 The answer isn’t always straightforward and direct. A home renovation budget is more art than science.

It’s easy to tell that a project of a 2,000-square-foot house will cost $200 per square foot to construct. But will it be the house you dreamed of? Does it contain all of the intangibles and idiosyncrasies that any house construction project has?

You should ignore any cost-per-square-foot guideline if it’s an add on or remodeling project. Workingin an existing home, particularly one that’s a little older, has its guideline

Having said that, the best way to telling costs for your project and location is to consult with many professionals, designers, and builders.

 Each will certainly suggest a different “number,” then you’ll have to go into the detail of what that number includes.

1. Identify the project.

 Is it a new house, an add on to your already existing home, a kitchen or bath renovation, or some combination of these?

 Each has a different budge. While an easy “per square foot” cost may work for a new construction project, it certainly won’t work for kitchen and bath renovation.

Besides, for a redesigning or renovation to an old house, ignore any kind of cost guidelines. The best way to establishing a budget for projects like these is to consult experienced professionals.

2. Identify every detail in your budget.

 Homeowners usually don’t identify all of the pieces of the budget. Certainly, the biggest piece may be the construction costs, but there will be several other costs.

 They include land costs, legal fees, moving, decorating, landscaping, impact fees, architectural fees, permit costs, and financing costs. Make your budget to include all of your possible costs and assign each a value. It would be sad to finish constructing the house but you find that you don’t have any money for landscaping or furniture.

3. Know yourself.

 If you just want to have that beautiful range that costs as much as a new fancy car, don’t budget for the generic range from the local appliance store. Think about what you truly want and how you want to use the house you’re building, and ensure you’ve budgeted for it.

4. Expect to splurge.

 In the budget, allow for the few places where you’ll want to splurge. For example, the kitchen back splash is a spot you wish to add something really special and remarkable.

If you spend a lot of time in the kitchen, the back splash is something you’ll see many times a day for several years. Even if it costs a lot, allow yourself to spend a little on something you love.

5. Plan well. 

An easy way of ruining your budget is to delay decisions or, as they say, “kick the can down the road.”

 Construction has begun and you haven’t made enough decisions about tile, plumbing fixtures, trim, and other things. The builder starts asking you to make decisions or, worse, just do something without really thinking.

You may find yourself tearing out work or, worse, have to live with something you don’t like as you don’t have the time or cash to replace it.

The best way to prevent these scenarios is to have your architect and/or designer prepare a detailed plan and make all decisions before starting construction.

Then, don’t change your decisions as making a plan, and following it is the best way to stay on track.

6. Have a contingency.

Justlike other projects, in a  construction project,things happen. It could be an issue with the bearing capacity of the soil or uncovering rotted wood when getting ready to construct. The best way to handle the unknown is to allow for a contingency in the budget.

The optimal way is, to begin with, a higher contingency, say 15% to 20%, and then gradually decrease the contingency as you go through the project stages.

 When you first start the design, you’ll have an item in your budget for 20% contingency. After finishing the drawings and the pieces of the project are determined you may minimize the contingency to 10%.As you go through construction, you can decrease the contingency even more so that when construction is done the contingency is zero.

You don’t have to spend all the contingency. If it isn’t spent, think of it found money that you can save. That’s a good way to feel good about staying on track and sticking to the budget.

7. Beware scope creep.

 A sure way to blow your budget is making additions that are not planned for you may justify it by saying “it’ll only be a few hundred dollars,” but once you do that a many times, you’ll have added a lot of work and will eventually bust your budget. Don’t forget that you set a plan and stay determined to stay on track.

8. Consider trade-offs. 

Sometimes it’s hard, if not impossible, to pass by that wonderful item that you find during shopping for the project that’s not included in the budget. If it happens, check your budget and what you have left to do, intending to cut the cost of something else to afford this new item. Is there a part of the work, such as painting a few walls, that you can do yourself?

 Maybe then you can use that new find and make it fit into your budget. Get what you want and stay on track by moving budgeted amounts from one area to another. However, make sure you consult professionals before starting any renovation projects in your home.