You may have lived in your house for a while, putting up with its annoying little quirks or inconveniences, or you may have just bought a house in dire need of TLC and you’re now itching to roll up your sleeves and renovate. One of the most important things to do before walls actually start coming down is to set a budget.
Here are 6 questions to consider before deciding on your renovation budget.
- Is this a good time?
- What should be done?
- Will this renovation add value to your house, and does it matter?
- What is your comfortable spending range?
- Will you be using a contractor, or will this by a DIY project?
- What costs should be covered?
Renovations can be taxing – not only financially, but also physically and emotionally. Are you on a stable ground financially? Are there issues with any family members that could become a hindrance during the renovation?
There is usually a host of things homeowners would like to address in a renovation – some may be a necessity and some just inspired by a home renovating show or a fabulous layout in a magazine.
A good way to zero in on what should be a priority, is to create two lists—Home Improvement Needs and Home Improvement Dreams. Discuss or think about the items on each list with your renovation designer, filtering them as you go along.
Once you’ve zeroed in on what you would like to renovate, consider if it is worth going ahead with it in terms of the future return on investment.
First, find out the median value of homes in your area — this will give you an idea of what your house is worth. If the renovation is extensive and expensive, you may not be able to recoup your investment when the time comes to sell the house. However, this might not even matter to you if you’re planning to stay on in the house for many years, enjoying that huge addition or that state-of-the-art kitchen! It’s all about deciding what’s best for your needs.
What is the most you are able to spend? Are you willing to seek financing for this project? It is crucial to establish your spending limit as it will dictate what you should and shouldn’t do.
There are many benefits to using a professional contractor, not least of which is having an expert attend to the structural, electrical or plumbing alterations, according to building codes and permits. A renovation with a contractor will also likely be faster and less intensive. However, doing it may be less expensive, assuming you know what you’re doing; otherwise it will likely prove to be a costly disaster.
If you’re using a contractor, they will give you an estimate based on what needs to be done. However, before you commission a contractor, determine exactly what you want in the materials used.
For instance, what kitchen countertop do you want? What type of fixtures? You will also need to add on about 10-20 per cent for unaccounted for expenses (such as having to temporarily relocate while your house is being renovated, if necessary).
If this will be a DIY project then you need to source out and estimate the cost of the materials you want to use, determine the purchase or rental of the tools and equipment you’ll need, and the cost of permits and cleanup. And, of course, you need to factor in the GST on all costs.
It’s not difficult to set a realistic budget for your renovation if you consider these questions in an honest, unflinching way. Remember, the best way to stay on budget is to hire a professional! It’s their job to ensure that your budget stays on track while making your dream renovations a reality.