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Budgeting a Home Remodeling Project
How to keep your Home Remodeling Project
on Budget
By Mark J. Donovan
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Too often I have seen folks begin
a home addition or home renovation project without first really considering
their available budget. They frequently wind up starting a home remodeling
project that is too big to fully complete, and end up with either an
unfinished home remodeling project or going deeper into debt than they
originally had hoped.
Establishing a top line home
remodeling budget should be the first item on your to-do list when planning a
home remodeling project.
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By knowing up front what you your
maximum investment level is in your home remodeling project you can then
size your project accordingly.
In order to budget a home
remodeling project properly it is important to get accurate material and
labor costs. If it is a small home remodeling project that you intend to do
yourself, visit your local home improvement store and cost out the material.
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Sometimes you can provide the home
improvement store with a bill of materials for the home improvement project and
they will work up the specific material costs for you. If it is a large home
improvement project then contact multiple contractors, or subcontractors, and
obtain several quotes for each aspect of the project, e.g. plumbing, electric,
insulation, drywall, etc.
When developing a home remodeling
budget it is also important to allow for some contingency in your estimates, or
estimates you have obtained from contractors or sub-contractors.
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There are always issues that come up that normally lead to higher costs than
originally anticipated.
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Also, really think through every aspect of the home improvement project. If you
are building a home addition, or remodeling a kitchen, make sure you budget for
permits, demolition costs, and temporary services. You may also need to purchase
an insurance policy on building material theft and liability during the
construction phase. In addition, if you are building a new custom home, you may
need to budget for a portable toilet to be on site.
In addition, if you plan to
finance the home remodeling project you need to budget for the costs of
obtaining and carrying the loan.
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Finally, it is important to consider
the future property tax liability. A new home addition or remodeled kitchen
could end up costing you thousands of dollars more per year in property taxes.
Make sure you consider this cost in your household operating budget.
Building a home addition or
remodeling a kitchen or bathroom is a great way to invest in your home however
it is important to develop a realistic budget prior to kicking off the project.
Do not be too optimistic in your budgeting. Obtain accurate costs. Allow for
contingencies. And stick to your budget during the construction of your home
remodeling project.
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For help on building a new custom home, see HomeAdditionPlus.com's
New Home
Construction Bid Sheet.
The
New Home Construction Bid Sheet
provides you with the knowledge on how to plan a custom home building project,
and what to look for when hiring contractors for your new home construction. It
also includes a detailed cost breakdown table and spreadsheet for estimating
your own new home construction building costs.
Get a Home Improvement Loan for
your Home Remodeling Project -
can help provide funds for your new home improvement project if financing is
required.
Related Articles on Home Improvement Loans and
Financing a Home Improvement Project
Related New Home Construction Articles
Additional New Home Construction and Home Remodeling Resources
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