How to Create Your Home Renovation Budget
Whether you're renovating one room or the whole house, it's time to think through the process of creating a budget for your project.
As you plan, get to know different ways to shape your budget and some tricks to make your dollars go further.
Think large to small. One approach to creating your renovation budget is to first understand the anticipated costs of the must-haves. "There are certain fixed costs you can't avoid," says Tricia Charbonneau, associate principal with Morgante-Wilson Architects in Evanston, Illinois. "Most people have an idea of what they have available to spend on a renovation. So start by thinking about the most expensive things you must have to complete your renovation, such as electrical work and a roof, perhaps. Then, subtract those costs from your available funds. The remaining dollars can be broken down to cover finishes and other features."
Drop an anchor. Another approach, says Charbonneau, is to "pick a point in space. Meaning, choose one thing you feel you absolutely want for the space, such as some gorgeous tile, and make a few selections around it, such as cabinets." This strategy, she points out, "allows you to drop an anchor, but you aren't married to anything. It's an exercise that's helpful in determining what you are dreaming about for the project and, once you understand costs, what things you may decide to compromise on."
Browse our room galleries to begin feeling out which of your home spaces deserves your immediate attention:
Consider the neighborhood. Never spend more on your renovation than your location can support. You don't want the most expensive house in the neighborhood so you can recoup your expenses if you decide to sell. Visit with some local realtors and check comparable sales to find out how much homes are worth in your area and what renovations and features buyers value most: Maybe media rooms are more desirable than home libraries, or perhaps a coastal location makes revamped a laundry room or sleek outdoor kitchen worthwhile.
Plan for contingencies. Most remodeling experts suggest padding the budget by 15 percent to cover the unexpected. "We always include two contingencies in a project budget," says Charbonneau. "One covers the unexpected, such as opening a ceiling and finding a rotten beam that simply must be replaced. The second covers the fact that homeowner changes to the plan often result in increased costs. For example, you replace a piece of trim, which means the trim in the next room doesn't match, so you change that too, and before you know it, you've spent an additional $2,000."
Save and splurge. Find ways to cut expenses, such as buying all your appliances from one dealer and requesting a discount or purchasing floor models for less. Then apply your savings to something you've been dreaming about, such granite countertops. "You can also devise strategies that give you more bang for the buck," says Charbonneau. "For example, you can get the look of expensive wood paneling by applying trim directly to the wall to mimic recessed panels, then paint the wall and trim pieces one color. It reads like wood paneling for less."
Indulge in the planning phase. Hours spent researching how you'd like your renovation to look and proceed is time well spent in the long run.
Glean more home redo tips here on HomePortfolio: