There are comments about setting your budget and sticking to it in all of the home renovation advice we have seen. However, some people have not previously renovated a house, so they may not have any idea of the cost of renovations.
If you do not know the cost of each job that you are planning to complete, we recommend you use a realistic estimate. An estimate based on the average costs of each project will help you to assess the minimum amount you will need to begin renovation works. The cost may also vary depending on where you live and the materials you are planning to use.
The average cost of a renovation of a property measuring 1,000 square feet is around $19,000, with an increase to around $87,000 for a property between 3,000 and 4,000 square feet. If you are not planning to renovate the entire property all at once, you may be able to spend less than this initially and pay for each project as you get ready to complete it.
If you are renovating a property to move into but do not need to worry about the time it will take to move out of your old property, this might be an easier way to renovate. However, if you are living in the property at the time of renovating, completing the full house renovation as one project may be easiest.
If you are living in the property while renovating, you need to begin thinking about where you will be while the work is carried out. Will the renovation be completed in a way that allows you to continue to live there while the work is done?
If you are planning to stay somewhere else while the renovation is being completed, you will need to factor in the cost of this when making your budget.
Work Out Your Maximum Spend
When deciding your budget, you should set a cap on spending so that you do not go over the top. When renovating your house, you should not spend more than 15% of the value of your home. If you have recently purchased the house, you will know the current market value, but if it has been a while, you may need to make an estimate.
Ensuring that you spend a percentage of the market value means that you will be adding to the value of the house. If you spend without considering this, you could end up spending far more than the renovation will add to the value of the house.
Of course, if this is your forever home or if you need to renovate in a specific way for a specific reason, you may consider exceeding this.
How Will You Finance?
Before you begin hiring contractors and purchasing the new items with which to decorate your house, you need to know how you are paying for the renovations. Similarly to working out, your maximum spend this will tell you how much you can afford for each part of the project. We advise keeping up to 20% of your total available funds for any miscellaneous expenses as the project begins.
Now to Make Your Plans
Now that you have a broad outline of your budget, you can begin to make plans for the renovation project. By making plans, you will be able to decide what your budget will actually need to be.
The first thing to do is to decide what your priorities are. Knowing which projects you want to complete means, you will know how much you need and in which order.
With your priority order in place, you can begin to make cost estimates. To do so, we recommend you make a detailed plan of how you want each project to look and the work that needs to be done to achieve this. You can then pass this information on to the contractors.
There are several websites that will allow you to estimate the costs of each part of the home renovation project. You will also need to factor in the cost of labor for any professionals you will be employing.
We recommend that you cost your fixtures and fittings, paint, and any additional furniture that you will be replacing, as this will all add to your costs.
You should also include in this the costs of removing any old furniture and appliances and the cost of living if you are staying somewhere else while the renovation is being completed.
We recommend that you always ask for estimates from multiple contractors to see what is a fair price and also what the best price you can get is. Once you have received estimates, we advise you to look at reviews for the contractors you are considering. You can use multiple websites to get honest customer reviews.
After hiring the contractor, you should ensure that you are clear with what you expect from the project. You should also be clear about what you have as your budget, so the contractor knows what they are working with.
An extremely low offer is always a red flag for us. Cheap labor often goes hand in hand with cut corners and mistakes that will be costly to fix later.
If you are not able to get any contractors to work within your budget, revisit your priorities list and start at the top, then begin the lower priority tasks when you have more money to work with.