How To Make A Budget For Your Next Home Renovation
If you already know what you want to renew in your house, you need to budget for your new project. You probably already have an image of your perfect kitchen, bathroom, office or bedroom, and it can be really hard to get everything you want without breaking the bank. Luckily, there are simple ways to plan for your next home renovation.
Start Planning In Advance
How many things do you want to change in your house? Sometimes, it’s cheaper to buy a new home rather than trying to repair an old one. Real Estate Investment Companies in Peoria Illinois will help you choose the best option.
Any serious renovation project involves contractors, hassle, bids and dirt, so oftentimes it’s easier to get a new house. You can get a completely renovated house and work with an agent who will do everything for you.
If your renovation project isn’t that big, you can easily budget for it. Here is what you can do.
Think About the Costs
If you aren’t sure how much you can spend on each room, calculate the value of the room as a percentage of the house value. As a rule of thumb, a kitchen takes around 15% of the value, so prepare to spend no more than that.
You should always remember that kitchen renovation has the lowest return on investment and every dollar you spend on a kitchen increases the overall value of your house by only 50%. The highest return on investment is the bathroom remodel.
There Are Loans for Home Renovators
If you have a huge renovation project, you might consider borrowing money from a lender and find a loan that suits your needs. If you have a smaller project, consider a home equity loan. If you need money over a long period of time, a home equity line can be better.
Talk With Many Contractors
Contractors have different prices and many of them can give you an estimate of what should be done as it will help you to budget for your renovation. You should be very clear about what you expect to get and have everything mentioned in your contract – this way, you will be sure everything is under control.
Get estimates from several contractors and don’t choose the lowest estimate. Going with this contractor can mean problems in the future because they love to cut corners at the expense of quality.
Develop a Plan and Stick To it
When you start with your project, it can be very tempting to add unplanned projects, change designs or get different materials at the last minute. But when you have a plan, you should stick to it because even small changes can cost quite a lot.
Account for hidden costs
Even if you carefully plan for everything, there could be problems hidden beneath the surface. Hidden costs are one of the main reasons why it’s so hard to budget for your renovation project.
Rather than trying to find some money after the project is complete, give yourself enough time to prepare. You can expect around 20% of hidden costs as they often occur. In fact, it’s very rare that a home renovation project goes without any problems.