What to consider when planning for renovations

You have noticed that your property needs some tweaking and a renovation might be on the cards. Renovations are usually financially straining and could leave a homeowner in arrears for years if not months.

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Many people spend more than they plan during a renovation. Sometimes it’s because of unexpected problems that come up, sometimes it’s because someone changes their mind about what they want during the process, and sometimes it’s a direct result of poor planning and not having a proper renovation budget.

It’s a truism that most renovations cost a lot more than the homeowners expect—and architects and general contractors say that it’s not uncommon for people to simply run out of money before a project is done.

Here is a list of tips on what to consider when creating a budget for your renovations to help prevent unforeseen expenditure from creating a dent in your pocket.

Set priorities and trim the project

Usually, your dream and your budget do not go together. When setting priorities for renovations, you will be able to carefully scale down your dream to fit your budget. Chances are you will end up satisfied and solvent.

This could help you come up with low-cost alternatives, keeping older items that are still in working condition and making the project smaller.

Taxes and shipping

Usually, when something needs to be customised, it could involve materials having to be shipped or delivery costs. When you are researching costs for your initial budget, it is easy to forget additional costs like taxes and shipping costs. Especially when things are being ordered online.

Counter-intuitively, lots of major purchases you will make for your renovation have serious delivery fees. Making provision for these fees in your budget will make your renovation process a lot easier.

Be realistic about what you can afford

With renovations you could incur major costs. Some people will have enough money saved that they can pay for their renovation up front, while others will need to borrow some of the funds.

You may want to look at financing the renovation with a secured line of credit or perhaps roll it into your mortgage to ensure you get the lowest interest rate on the funds. The key here is affordable financing.

Factor in the unexpected

Your budget might be looking good for the renovation, but you need to make provision for surprise costs or mistakes. No matter how much research you do, your renovation is likely to include costs you didn’t anticipate.

You don’t know what you’re going to find before you start tearing down walls. Electrical work may not have been done to code. There could be asbestos or mold hiding behind plaster. You just don’t know.

If you happen to incur any extra costs, you can put the extra money toward furnishings.

Get as many quotes as possible

You should determine exactly what you want, right down to the kitchen countertop material and the type of faucet. By specifying these details up front, you ensure that prospective contractors are all pricing the same items.

Get recommendations for at least three contractors from friends, neighbours, and other tradesmen who you trust. Give each one your project description and specific product lists and request an itemised bid.

When considering these specific factors, you will be able to set up a budget, that won’t only see you saving costs on your renovation, but also help you be financially prepared for what could go wrong.