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5 Tips for Developing a Home Renovation Budget

20 January 2021
5 Tips for Developing a Home Renovation Budget -  january hoy

It’s a new year and with the start of a new year comes the need for change. Staring at the same four walls, the same furniture or same home décor can be quite monotonous. It’s good to shake things up every once in a while and give yourself a new perspective.

Whether you want to do a full home renovation, a room remodel or simply do some repainting, it is important to develop a budget.

Budgeting might be the most boring part of the renovation process but it is also the most necessary. Remember: poor planning often leads to failure.

So, before you hire a contractor or visit the bank, read these five tips for developing a home renovation budget to set you on the right path.

1. Determine your Renovation Needs and Wants

Before you start thinking about costs, consider why you want to do the home renovation in the first place.

Do you have a second child on the way and need more room? Do you need an additional bathroom to cater for the larger family? Or is it simply time for a change?

The goals of your renovation or remodel will greatly influence the size of your budget. It’s a lot cheaper to repaint your home than to build on a whole new section. Once you know what you would like to achieve from your home renovation it will become easier to get started on the budgeting process.

2. Consider the Value of the Renovation

‘Value’ in this instance does not refer to the amount of money that you are going to have to spend to realise your renovation goals but rather to the property value increase your home will face as a result of the renovations made.

When planning any renovations it is important to consider how much value these renovations will add to your current property value. Sometimes the renovations made will not have an impact on the value of the property. This can be due to a number of factors including location.

While other times it is the renovation itself which does not increase the value of the property. An example of such a renovation would be a swimming pool. While we all love having a pool in the summer months, it is the maintenance and cleaning which has to go on year-round which deters many homebuyers from buying a home with a swimming pool.

That being said: if you are renovating with the purpose of reselling your home, then first be sure to do proper research or have a meeting with a realtor or property evaluator who can help you decide which renovations will be of value to your property.

3. Investigate Different Finance Options

Once you have determined the goals of your renovation and evaluated whether or not the renovations will add value to your property, it is time to consider the various finance options that are at your disposal.

The type of finance that you will need depends on the cost of the renovations you want to make. In most cases, if would be best to take out a home equity loan or to extend your mortgage depending on your current financial situation and circumstances.

Before agreeing to any form of finance, be sure to receive a final quote from your contractor and have a meeting with a financial advisor who will help you to receive the best finance deal for your circumstances.

There are two important questions to ask yourself before signing into finance: firstly, do you really need to do the renovations? And, secondly, do you really need to obtain finance?

If you really do want to go through with the renovations, then is there perhaps an alternative to finance such as savings? If you are only planning to repaint your home it would make more sense to save up to do so instead of taking out a loan.

Consider all the options before committing to your decision on paper.

4. Obtain Numerous Quotes

Looking for a trustworthy contractor is similar to looking for a new car. You will not buy a new car without comparing finance options at various dealerships or without taking the car for a test drive first.

Similarly, it is important to get a quote from various contractors to see who will be willing to offer you the best deal. But, remember, the cheapest offer is not always the best offer. Just because a contractor is offering to do the job for less, does not mean that you will be getting the same value for money.

This is why it is important to visit the contractor while they are currently working on a job site or request a portfolio so that you can see physical examples of the work that they are capable of doing.

This way you will be able to see who you can trust with the money for your home renovation project.

5. Cut Costs where Possible

Life is expensive and it is always good to save money where and when you can. However, do not confuse cutting costs with cutting corners.

As explained above, it is never a good idea to hire a contractor that is considerably cheaper than other contractors in the area. The same way, it is never a good idea to skimp on quality materials for cheaper alternatives that will not last.

Cutting costs simply means finding areas in which you will be able to save money. For example, if you are retiling the kitchen do you really need to buy the most expensive tiles or will a mid-range tile do just fine?

Or, if you are planning to paint your home, why not consider DIY’ing it instead of hiring someone to paint your home for you?

Always try to find safe and smart ways to reduce the costs of your home renovation. This money can always be put to use for other remodelling projects such as new home décor.

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Do you have any tips for developing a home renovation budget? Share your thoughts with the House of York followers by leaving a comment on our Facebook, Twitter or Instagram pages.

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