How to Set and Stick to Your Home Renovation Budget

Renovating homes often leads to people spending more than their budget. Many costs and variables happen during the renovation that might make you spend above your budget.

This article will explore how to develop and stick to your home renovation budget and get the desired result. Also, we will understand the importance of setting a renovation budget and determining your renovation priorities. So, read on and see how to stick to your budget while your renovation goes as planned.

Home renovation is a great way to increase your home's outlook and add value to your property. Hence, you need a budget to ensure the project is completed within the stipulated time with the allocated funds.

Sticking to a budget can be challenging whether you renovate a small portion of your home or the whole house. This is because unexpected issues might arise and increase the cost. However, setting a feasible and realistic budget is possible until you complete your project. Read on for tips and how we can help you with this process.

Understanding the Importance of Setting a Renovation Budget

There are many things to consider regarding renovating your home, including setting a renovation budget, sticking to it, and knowing where your funds went at the end of the project.

A home renovation budget is the maximum amount of money allocated to a project that will complete it. A well-planned renovation budget is crucial to the success of your project. It helps you to avoid overspending by prioritising your expenses.

Also, setting a renovation budget helps you make informed decisions about the areas of your home that need renovation so that you can properly allocate the funds you have. This way, you have an outlined framework that can be used to track expenses mid-way through and after the project.

Determining Your Renovation Priorities

Renovating a new home or upgrading an existing one can be overwhelming because of the number of areas you must pay attention to. Therefore, you must set your renovation priorities in order of their importance.

First, you can consider the areas on your list and see which ones are urgent and will significantly improve your quality of life. Urgent renovations are the ones that directly affect the safety and health of the people living in the house. Examples include leaks, termite damage, and electrical issues. All these issues must be attended to promptly so they will not degenerate.

Next on your list should be renovations that are not urgent but will improve your quality of life. This is based on your taste and stage of homeownership. Examples include adding a gym, home office, or playroom for children. All these renovations can also add value to your home, especially if you plan to sell it in the next few years.

Last on the list are renovations, beautifying the house and making it look better. Examples include custom closets, high-end bathroom finishes, and flowers. All these will improve the outlook of your home, but they only need to be done urgently if your budget has room for them.

Below are some other steps to take toward determining your renovation priorities:

Funding Your Renovation Budget

After drafting your budget, you can now have a funding plan. Funding is subjective; it depends on your current financial situation. If your current financial situation cannot be enough for the project, consider borrowing, especially if it is an urgent renovation that will improve your quality of life. Fortunately, the home equity line of credit and loans allows homeowners to borrow funds to renovate their homes.

Ask for Bids from Several Contractors

Next on the list is looking for contractors to help you with your renovation needs. You can search for local companies that have many excellent reviews and request bids. Then, get bids from about five companies, compare their prices, and choose the one that suits you best

You can then choose your contractor and invite them for interviews to see what they will offer you. It is essential that you explain to your contractor the need to practice renovation cost management so the funds allocated to it will be enough. Also, discuss with your contractor how you want to manage unforeseen circumstances that might arise during the project, which can affect the budget allocation for renovation.

Have a Contingency Budget

No matter how detailed your renovation is, unforeseen costs might arise. While renovating, new items might be needed that you should have budgeted for, even with renovation cost management. Hence, it is essential you have a contingency budget to cater for these costs. To simplify things, you can make your contingency budget about 5% - 10% of the total renovation budget. This way, you have allocated some funds to emergencies that might arise during the renovation process.

Conclusion

Home renovation is capital intensive, so you should have a budget in place for any project you want to embark on in your home. Also, remember to have a contingency plan if needed during the renovation process. Remember that the renovation process is a marathon, not a sprint, so take it slow.

At Moovick, we connect you with home improvement professionals and providers for renovating and revamping services that will upgrade your home to your desired taste and specifications.