Have you noticed your house slowly deteriorating over the years? Or perhaps you have recurring repairs that don’t really seem to last long. We get how frustrating, scary, and dangerous broken parts could be for your health and safety. But despite all the signs telling homeowners to start fixing their houses up, some still forego repairs due to the lack of budget or time — something many people can relate to. Furthermore, when people say they don’t have the budget or time, it doesn’t always mean they literally don’t have a large sum of money and opportunity; sometimes, it can also mean they’re just confused about where to start and how to follow through with it.
So in this article, we help you get a better picture of your current situation and renovation plans to help you make a well-informed decision and help you kickstart your renovation budget.
Identify Renovation Needs
Budgeting will be easier if you know exactly what you want to fix, upgrade, or remodel. Hence, the very first thing to do when budgeting is to make a list of all the things you want to cover and here are some guide questions to walk you through:
- What parts need some fixing?
- What kind of work is needed for each worn-out part?
- Is there anything new you want to add to the house?
It’s important to be as detailed as possible. For example, instead of just writing “living room ceiling”, you can write “mold in 30% of living room ceiling —possible plumbing and ventilation problem”. You’ll find this useful as you start prioritizing the works, identifying the solutions, and sourcing for materials.
Setting a goal for your renovation project is also important to stay on track with the budget. Much of overspending comes from the lack of planning and identifying scope and limitations. Once you have your masterlist of things to do in the project, step 2 is to prioritize.
There are different strategies to prioritizing depending on your preference. For some people, it means starting with the structure and down to the smallest of details; while for others, it means starting with the most damaged and down to the newest, “not necessarily a need”, parts.
When prioritizing, you can:
- Separate the needs and the wants
- Rearrange the list according to your goals
- Identify what renovation works you can do yourself (if you’re on a tight budget)
- Identify what repair works need a professional
- Identify non-negotiables
- Consider future plans
- Stay logical (don’t repaint a wall if you’re planning on taking it down sometime soon)
Draw Up Detailed Plans and Estimate Cost
If you have the list already of the things you want to prioritize, it will be easier now to expand on the plan. Some renovation works are doable without the help of a professional. For example, if you want to repaint an entire room, you can measure the area yourself and consult with the hardware which type of paint and how much paint you’ll need to complete the work.
With structures and system renovations though like repairing the foundation, roof, and plumbing system, you’ll really need a licensed professional to create a detailed work plan and cost estimate for you. Once you have all the cost estimates for every renovation work you need, run through it again and remember to allocate for contingency. Contingency budget is needed for unforeseen or emergency expenses, and it usually ranges from 5%-10% of the total project cost. If you hire a contractor for the cost estimates, contingency is often included already in the total cost.
You might have heard of the famous “do not let your renovation costs exceed 15% of your home’s value” investment advice. However, we believe more on the fact that you should focus on the fixes that give the most return and rely on your comps to set your maximum renovation costs, especially when your renovation is nowhere unique within your neighborhood.
For example, if you merely painted or replace the tiles on your kitchen countertops and spent so much on them, that may increase your home’s value but it wouldn’t always translate as reasonable to buyers especially when there are other lower-priced comps that have good-looking and functional countertops. In short, it might be more difficult to sell your home.
So, take all the time you need for planning and estimating the costs. A lot can happen once you start renovating and your plan will keep you on track.
How Will You Finance the Project?
Once you have your cost estimates, it’s now time to determine where to source the funds. Not being able to afford renovations in cash isn’t anymore a hindrance due to the many renovation loans offered by different public and private institutions. If you were to loan your renovation budget, make sure to factor in the interest and other payment terms. The goal here is to find the home renovation loan that could least compromise your future finances.
Request for Quotes from Different Contractors
Once you have your budget, it’s now time to look for reliable contractors (for non-DIY works). We recommend comparing proposals from at least three contractors and see how well they performed with their previous projects.
If you’d like to know more about the budget you’ll need for the renovations you want, contact us at Spire Property Solutions. We also offer straightforward solutions for homeowners who want to sell their homes because we buy houses in Warner Robins as is! You won’t have to do a single renovation or repair work for us to say “yes” to your house and all you need to do is contact us at (678) 318 – 1801 or send us a message through the form below.