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Pricing Your Remodel: How to Stay Within a Budget

Remodeling can be expensive but if you are willing to contribute some work and even a bit of sweat to turn your home into what you envision it to be, in the end you’ll save a lot of money and be able to take a lot more pride in the result.

Pricing Your Remodel How to Stay Within a BudgetIf you’re planning to remodel your home, it’s important to be prepared to set your budget and stick to it unless you want your home to become a money pit. While you might think you’re a great money manager who will only spend what you can afford, it might be difficult unless you have realistic expectations from the start. Here are some tips to help you price your project and stay on budget.

Know How to Set Realistic Cost Projections

If you’re not sure how much of your budget will be eaten up during different phases of your project, you will be off base. This is why you should be aware of how costs breakdown for the average project. There are exceptions to every rule, but in many cases large project budgets can be broken down roughly as follows:

  • Labor: 35%
  • Windows: 10%
  • Appliances: 20%
  • Fixtures: 5%
  • Fittings: 3%
  • Flooring: 15%
  • Finishes: 3%
  • Other: 9%

So if you are doing your own labor you should be able to reduce costs by at least 35%. And by careful comparison shopping for materials you could easily save another 10% since contractors are all about convenience and speed rather than getting the best prices (since they just pass these costs on to the consumer). For instance rather than shopping around, a contractor would probably simply go to a local supplier for outdoor furnishings. But by shopping around you could locate designer quality patio furnishings at some place like Design Furnishings that will give you “factory prices”.

Another benefit of “D-I-Y” is that you can add a bit of your own creativity. For instance very few contractors would suggest painting your counter-tops because it is too labor intensive and the result is too variable and thus there is no guarantee that you will like how they do it. But that doesn’t mean that you can’t do it yourself. In several YouTube videos you can see how easy it is to do yourself.

 

Set Money Aside For When Disaster Strikes

In a perfect world, you would set a budget and everything would go smoothly. Unfortunately, as anyone who watches the remodeling shows on HGTV knows, if you run into mold or a structural problem you couldn’t predict, it can be a huge and devastating surprise. Set aside money just for the unexpected so you have a little wiggle room when surprises crop up. Most remodelers suggest 15 to 20 percent, depending on the size of the project.

Create a List of Priorities to Tackle First

At first you might feel extremely ambitious when you start planning your renovation. You have so many different things you want to do, but only have the money to complete one project at a time. This is where having a priority list can help when approaching your budget limit.

If there were no problems with dry rot or mold, you may be able to hit items down the list that were goodies, but not must-haves.

If you have a detailed spreadsheet of costs and you can update it regularly, it makes it easier to track costs and find out where you stand. If you notice you have gone over in one section, look for an area where it might be feasible to cut costs. Stay focused, don’t add extras, and even try tackling some of the labor during your free time to help cut expenditures.

About Tim McMahon

Work by editor and author, Tim McMahon, has been featured in Bloomberg, CBS News, Wall Street Journal, Christian Science Monitor, Forbes, Washington Post, Drudge Report, The Atlantic, Business Insider, American Thinker, Lew Rockwell, Huffington Post, Rolling Stone, Oakland Press, Free Republic, Education World, Realty Trac, Reason, Coin News, and Council for Economic Education. Connect with Tim on Google+