You’ve done it. You bought the house of your dreams. Except… the kitchen isn’t really what you envisioned. And the bathroom would look so much nicer with a stand alone tub. Renovating your home is the way to go but how much should you put in to the project? Can you even afford it? Luckily for you, we have some tips that will help you create the best budget for your wallet!
Don’t pick up that hammer just yet. Planning is a huge first step in the renovation process, especially if you want to budget everything out accordingly. Having the best strategy beforehand will make the decision-making process easier later down the line. Here are some guidelines to follow when making your renovation plans.
- Dream Big, Stay Realistic: There’s no harm in striving for that dream kitchen or bathroom but keeping a practical mindset will help keep the costs down. Create a list of all the things you want in your renovation if money wasn’t an issue. Then introduce the costs and see what can be done and what can’t. This way you can keep what you want but cut back on the frivolous things that can be added later.
- Keep Your Home Value in Mind: Most people renovate their homes because they want to change a certain aspect of it. However, you need to keep in mind the return on investment (ROI) of the project. Will overhauling your front door increase your home value? (Yes, yes it will.) How about replacing the hardwood floors with carpet? (No, no it won’t.)
- Make a Smart Budget: According to Zillow.com, your renovation costs should be no more than the value of that room as a percentage of the overall house value. The example they give is a kitchen renovation, which is about 10 to 15 percent of a home’s property value. If your home is worth $200,000, your renovation should be between $20,000 to $30,000.
When Hiring Contractors, Pick Quality over Cost
Contractors are an essential investment for any renovation project so don’t feel like you need to jump on the first one you see. Check Angie’s List or HomeAdvisor for quality contractors that have a good history and standing with the previous clients. Pick at least three contracts to place a bid on your project and throw out the lowest bid out of the bunch. Contractors who provide the lowest estimate usually cut corners at your expense.
Prepare for the Unexpected
Unexpected renovation problems are ALWAYS bound to happen, there’s no way around it. Take precautions by leaving out 10 to 20 percent of your budget to unforeseen issues and expenses.