It might sound boring, but a budget is a must. Without a budget that is accurate and precise, your costs will spiral out of control. Yes, you will have a fantastic home at the end of it, but it may cost you your relationships and your beautiful home, as you find you cannot afford to keep it after it is completed.
Stress levels are rife on a building site that is also being used as a home. So, you must maintain control over the areas of the renovation that you can. Working out a budget beforehand can provide you with this level of control.
#1 Get Quotes for Work
Regardless of what work you are planning to have carried out on your property, you should endeavor to get multiple written quotes. Contractors vary in opinion, price, and experience. You should ensure that you are hiring the services of someone that you trust to do a good job and that is neither overquoting the workload to up the price nor undercutting everyone else to secure work. With written quotes, you will have a record of everything that you have asked to be done, so if a job falls short, it is not your word against that of your contractor.
Hiring the services of those that are too cheap could be leaving yourself open to shoddy workmanship or being left in the lurch. However, this is not to say that by paying the most you will get much better if you pick the wrong contractor. If in doubt, choose a well-established building company, look for testimonials from customers, and ask plenty of questions to check that they know what they are talking about.
#2 Research the Costs of Materials and Items on Your Wish List
Ensure that you research your costs. Everything that you will have to pay out for should be written down accurately. Ensure that you have written copies of everything that your contractors are buying for your renovation so that you do not double up and nothing gets forgotten.
Remember that if you change your mind during the period of the renovation, it is likely to increase the price and not only of materials, but also in contractor time, as well.
#3 Workout Your Finances
You should most certainly work out your own finances to make sure that you can afford everything that is included in your budget. If you cannot, you have a couple of choices ahead of you. You can either tame your budget and move away from those items that you cannot afford or apply for a loan.
Many loan providers will be happy to lend money to those wishing to renovate their homes, as long as certain criteria are met. However, whether you will be able to borrow more if you exceed your budget, is another matter. Watching your renovation project slow to a halt due to insufficient funds can be beyond frustrating, and it can also be demoralizing. Stress levels will increase, and you may feel that the work will never be completed.
However, you do have the option of refinancing even if your current lender says no. This may be due to hard money refinancing options. Refinancing in this way could mean that your project gets back up and running, taking the work through to completion and settling down the stresses that have occurred during the renovation project.
Final Thoughts
To build an accurate budget, you should make sure that you include everything. Try not to underestimate and, where possible, work from factual prices and quantities. You may find that during the renovation, some figures do need to be tweaked, so including a contingency figure in your budget is also a good idea. You should also research your options should you go over budget, and this should just help your project continue as smoothly as possible up until completion.
