Did you know that the average cost of a home renovation project can be anywhere from $18,000 to $77,000? Knowing how much you will have to spend on a renovation is crucial since it can help you prioritize what you want. To help you manage, you need to put together a budget for renovation.
But how can you put together a budget you can stick to? This is where a renovation cost guide can be helpful in estimating costs. Let us look at some tips that can make a difference.
- Budget for Renovation: Consider Your Financing Options
Most people cannot afford to pay upfront for home renovations, so it is likely you will have to rely on financing. You can choose personal loans, which are not tied to the home and depend on your assets and your credit score.
A home equity line of credit works a bit like a credit card and you can borrow money on your home’s equity. You can also choose a cash-out refinance, which allows you to refinance your existing home loan and take out more money than you currently owe.
Whichever option you decide on, knowing what your financing options are is the first step to planning a budget.
- Prioritize Projects
It is likely you will not be able to do everything you want in the home renovation. By knowing what your priorities are, you will also make it easier for contractors to offer an accurate estimate.
When prioritizing, think of what your end goal is. Is it home value increase? If it is, then you can focus on projects like updating your roof, adding solar panels, and a new kitchen floor installation. Another idea could be doing an interior design overhaul with companies such as Space Factor, where these designs will definitely increase it’s value and selling price.
- Get Estimates
To be able to put together a budget you can stick to, you have to have accurate estimates. How can you know if you can afford solar panels if you do not have an idea of solar panel cost?
Ask for a hard estimate, which includes a detailed list of the costs as well as the timeline in which the renovation will happen. You may want to reach out to two or three contractors to compare rates. It is not always the wisest choice to go with the contractor that bids the lowest, however, because they can cut corners in quality and safety.
- Plan For the Unexpected
A home renovation will offer surprises and complications and you want your budget to be able to handle them. When you receive estimates from contractors, pad them a bit in your budget. In most cases, experts recommend adding 10 to 20 percent to your budget to cover these surprise costs.
Start Your Renovation the Right Way
When you create a budget for renovation, you are beginning the entire project on the right foot. You will be able to tell your contractors what the budget is and you will be able to get the results you want.
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