The idea of renovating your home, of turning it into exactly the kind of space you want to live in, is fascinating. It might be that you bought a property with the sole intention of improving it to enjoy living there, or perhaps to sell it for a profit. Alternatively, you might have lived in a place for a long time, and it is now time to change things – if your family has grown you could need extra space, and if they have left home then you might want to turn a bedroom into a gym or study, for example.
No matter what it is you want to do or your reasons for doing it, you are going to need to spend money to get to the end result that you are looking for. Most people aren’t going to be able to say that there is no budget and that money is no object, and even if you can, this isn’t a good idea; you could spend far too much if you write a blank check for the work. Therefore, a proper budget is going to need to be put in place detailing all aspects of the work and giving you a much better idea of where your money is going to be spent (and how much is going to be spent).
This can be a difficult thing to do, especially if you don’t normally create budgets for anything, or you don’t know what anything is going to cost right now. Even so, a budget is going to be one of the most critical aspects of your home renovation, even if you are doing some or all of the work yourself, so it needs to be done. Read on to find out how to get started.
The very first thing you need to do when you are starting to budget for any kind of home renovation is to determine which elements are most relevant and prioritize them at the beginning. This means splitting the job you want to be done down into separate stages, putting them in order of importance. Once you have done that, it will be much easier to start a budget – you will know what has to be done first, and therefore what money needs to be spent immediately, and you will know what can if need be, wait until you have more money to spend.
Not only will this help you to budget and not overspend on items that aren’t important at this stage of your renovation, but it will also help you to get a better idea of how the project is going to work in the first place. Plus, you will be able to set out a timeline for the work to be done and give yourself goals to aim for. All of this will generally make for a much smoother renovation.
Get Accurate Costs
When you initially start to create your budget, you will have estimates in place of accurate pricing. This will give you an idea of what you could be spending, but without the true costs, you will never know for sure. Once you know what needs to be done, you will need to then get much more accurate costs. This is the only way you are going to know for sure what you can and can’t afford, and when you can start your project (you might, for example, find that you need to save up for a little longer, or you need to find funding elsewhere else you finalize the costs).
Now is the right time to speak to contractors for their costs. It will depend on how much of the work you want to do yourself, and for smaller jobs, you may not need any professional help at all, which will save you money. For larger jobs, it is always a good idea to get help from experts, which might include a civil engineering firm, architects, or contractors who are skilled in painting and decorating. Who you need to speak to (and in which order) will depend entirely on the scope of the project you want to take on.
When getting costs, it is best to speak to more than one professional in each field to get a range of prices. Sometimes it’s not solely cost that is going to matter, which is why you should always meet the contractor in advance to get an impression of what they would be like to work with. You are going to need to be with them and work around them in many cases, so it is crucial you like them as well as can afford them. Otherwise, the home renovation is going to be a miserable time for everyone in the household.
Where Is the Money Coming From?
Now that you have a plan for your renovation and you have the costings to put into your budget spreadsheet (which is an essential tool to have), you are going to need to work out where the money is coming from to pay for everything.
If you have savings and the budget comes in under the amount you have saved, you may want to begin right away. After all, big projects like a home renovation is exactly what savings are meant for. However, if – like most people – you don’t have savings or your savings won’t cover the expense, you are going to need to look elsewhere and have the funding in place before you begin the work. If you don’t, and only have part of the money, what would happen if you ran out partway through and couldn’t access any additional funds? Your home renovation would not continue, and you could be left with unusable rooms and a lot of mess and stress. It just isn’t worth the risk to begin when you’re not sure how you will pay for the entire project.
Other means of paying for a home renovation project include borrowing money from friends and family, or (and this is preferable) from a bank or other financial institution. You might also think about remortgaging your property to release equity. A renovation will often add value to your home, so if you do this, you might be able to recoup the costs via the work that is being carried out.
Remember, you should always add an additional 10 to 20 percent onto your budget to account for any extras that may need to be paid for.