Home improvement projects cost a lot of money which is why it’s important to have a renovation budget. It means you can better monitor your expenditures, and make more financially reasonable decisions.
While a budget is beneficial in many ways when doing a home renovation, there are still instances where you may go over budget along the way. To avoid over spending, we have listed five effective tips on how to stick to your renovation budget:
1. Know what you want
It’s difficult to make a budget when you don’t have a concrete plan of your home renovation. Are you going to renovate the kitchen, the bathroom, your bedroom, or the entire house? A plan will give you an idea on what kind of materials you need to spend on. The more specific and detailed the plans are, the better you can stick to your budget.
2. Be realistic about what you can afford
Now that you have created a detailed renovation plan, it’s time to find out what you can afford in regards to the materials you will use. For instance, you want the expensive marble countertop which costs $2800 per square metre, instead of the reasonably priced soapstone countertop that costs roughly around $2000 per square metre. If you can afford to buy the marble then go for it, but if you can’t it just make sense to consider the more affordable option.
3. Don’t forget to add a buffer
As they say, expect the unexpected. Leave room for your forecast costs to blow out at least 10% to 20% to give you adequate room to play around just in case of an unexpected event. Everyone should have a contingency plan when doing a home renovation to avoid going over budget as much as possible.
4. Always communicate with your builder
You might have hired a builder, a tradie, or an architect. Their roles are significantly different from one another, so make sure you communicate with all of them consistently so all parties are well-informed in regards to your home renovation project. This will stop them making unplanned decisions that can break your budget, and to also help you be informed about the latest changes.
5. Hire the right builder
There are several things you can do to choose the right builder, such as:
- Asking for a complete quotation and comparing different builders with each other.
- Looking for relevant experience and credentials.
- Making sure that they have structural warranty and home builder’s liability insurance.
- Reading the fine print of the contract before committing to a builder.
Make sure that you monitor your renovation budget throughout the process, from beginning to end. This will allow you to keep track of your expenses and stay on budget as much as possible.
Are you starting a home renovation soon? You can check out our construction loan products to get you started building or renovating your dream home today!