How to Budget for Renovations - Movers.com
Home > Moving Guides > Home Improvement 101 > Home Improvement 101 > How to Budget for Renovations

How to Budget for Renovations

  0.0/5
views  397 Views
Remodeling your home can quickly become more expensive than you originally anticipated. Staying organized, dealing with contractors and making tough decisions every day only adds to the stress. Creating a budget for your home remodel is important. If you're unsure of where or how to start, read on for some tips to get started.

The process

The process begins long before you step foot into your home improvement store. It starts with a long list of priorities. Think about why you're remodeling -- a growing family and/or increasing the resale value of your home are both excellent reasons to remodel.

If you're feeling bored with the status quo and just "need a change", consider starting with redecorating your home instead. You might soon lose the itch to demo your kitchen if you balk at the idea of switching a few drawer knobs.

If you're hoping to increase the resale value of your home, consult with a realtor about home improvements that will increase the value of your home and give you the greatest return on investment.

Once you know for sure that you're going to be connecting sledgehammer to sheet rock, figure out how much you can actually spend.

What can you afford?

What kind of money do you have access to at the moment? Do you have enough in savings or your money-market account? If you don't then you'll need to think about financing--loans. Look at what's available in your household monthly budget can you afford to apply that much to a home equity loan?

DIY or contractor?

The next step is deciding whether or not to use a contractor or to complete the project yourself. Using a professional contractor has many benefits: time, their knowledge of building codes and permits, and their expertise in a particular trade (plumbing, roofing, electrical, etc.). A DIY remodel will likely be cheaper, will give you more flexibility and you'll probably feel more rewarded at the end of the day.

Budget

Once you've decided on a contractor or DIY remodel, you can get ready to sit down and plan out your budget. Your budget should include:
  • Labor (if you're hiring a contractor)
  • Tools/equipment (if you're doing it yourself)
  • Materials
  • Permits
  • Cleanup

Even if you're hiring a contractor, you can likely save yourself a bit of money if you purchase the materials yourself. Contractors sometimes mark up the cost of materials -- if you buy directly it could save you a bit of money.

At some point, you'll need to do a ball park estimate of the remodel costs. Major upgrades and remodeling projects, like a bathroom or kitchen, can cost $100 to $300 per square foot. Take that amount into account and then factor in an additional 15 to 20 percent extra as a contingency. If you're working on a specific room like your kitchen or bathroom, scope out the appliances you'll want installed and don't forget to factor that number into your materials cost.

Part of your budget will be labor costs if you're hiring a contractor, so be sure to do your due diligence and collect quotes and estimates from multiple contractors. If you have any doubts about how reputable a company is, check for any complaints against them on the Better Business Bureau's website, Angie's List or even Yelp.


Ana M. Ferrer  Posted by Ana M. Ferrer on December 2, 2014

Rate this guide How to Budget for Renovations