Summerstep eBook

How to Create (And Stick To) Your Home

REMODELING BUDGET

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YOU’RE NOT ALONE

How To Create (And Stick To) Your Home Remodeling Budget

So, you’re thinking about remodeling a room in your home.

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So, you’re thinking about remodeling a room in your home. You’re not alone - 40% of homeowners plan on remodeling their home this year. But how many of those people create a budget they can afford and stick to?

Formulating and maintaining a budget is one of the most important parts of remodeling. You don’t want to get halfway through your project and realize you don’t have any money left to finish. Follow the tips and steps in this guide and you’re sure to complete the remodel you’ve always wanted.


Making a Fool-Proof Budget for your Remodeling Project

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Putting together a solid budget will keep your project on track and ensure that expenditures don’t get out of control.

• Work out your budget before you get started

• Set limits

• Estimate the Costs

• Plan for Contingencies

• Get Multiple Quotes

• Prioritize Projects

• Stick to your budget


Work out Your Budget before You Get Started

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The process of creating a solid home remodeling budget should start long before construction actually begins. A good budget will have the dollars and cents of the project, but it will include much more than that. You should start with a very clear picture of what you want to accomplish with your remodeling project. Ask yourself the following questions to help you create a vision for your project:

• Why exactly am I remodeling?

• Do I need more space, a home office, or want to increase my home’s resale value?

• What is the scope of the project?

• What space will be remodeled?

• Will this project entail simple redecorating (new paint, wallpaper, or light fixtures),

or a complete remodel?

• What are my priorities for this project? – are new cabinets the most important

item, or flooring?

• If unexpected expenses hit my budget, what are the top things I still want to get done?

• What will the end result be for this project?

• What is my time frame for this project?

• What will I do myself? What will I hire out?

• How much do I want to spend? How much money do I have available for this project?

• What sources of funding are available to me for this project?

SET LIMITS


Before you even start estimating costs

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Before you even start estimating costs, it is best to set limits on your project. How much can you really afford to spend on this remodel? It’s okay to have a wish list for your home, but before you move forward, you need to be honest with yourself about what you can realistically do. If you don’t have all the money in the bank ready to go, how will you get financing for your remodel? What will the repayment terms be? Will the repayment fit within my budget?

Once you know what you want and what your limits are, you can start to figure out what your project will really cost and reconcile the two. The value in setting your limits early is that you will be better prepared to stick with them as you move forward, and avoid scope creep – the mortal enemy of your budget.


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ESTIMATE THE COSTSOnce you have a clear vision

Once you have a clear vision of the scope of your project, you can look into how much your remodeling dream will cost you. You can create a ballpark figure by doing a little bit of research online. Use this link to figure out a good starting point.

It’s also helpful to do a little homework to find the materials you like and their average costs. Visit multiple home improvement stores and showrooms, and look at magazines to find the types of materials and appliances you want. Make sure to compare prices and visit local stores and internet suppliers to find the best deals.

You can save money at this stage by choosing lower cost alternatives, keeping or re-working older items, and choosing to update appliances or light fixtures later on. If you are hiring a professional to do the remodel, you can often save money by buying the materials/appliances yourself.

http://www.remodelormove.com/remodel-costcalculators


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As you are making a list of materials that you want for your remodel, it may be helpful to have at least two options for each material: the one you like the most and a lower cost alternative. That way, you have several materials to choose from, and that can help keep your project on budget. If you are flexible about your material choices, you will have more room to maneuver when unexpected costs arise.

When you are estimating construction costs, keep in mind that labor will generally account for between 20% and 35% of the project costs. Keep in mind that hiring professionals has benefits: they know how to get the project done right, have knowledge of required building codes and permits, and will get it done much faster than you can by yourself.

However, you may be able to save money if you choose to do the project yourself, or even a small portion of it, since you won’t have to pay for labor for that work.This can also give you more flexibility and can be very rewarding. Just don’t screw it up.

Estimate the Costs


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If your top priority is to increase the value of your home, talk to a realtor about which home improvements will translate into the greatest return on your home investment. Remodeling Magazine lists the following renovations and the average percentage of costs recouped:

A bathroom remodel also comes in high on the list at $16,128 of which 72.5% will be recouped on average at resale. Check out other projects and take a closer look at true project costs here.

Depending on the scale of your project, you should plan on spending between 6% - 10% of your home’s value to get the best return on investment. If you spend more than that on a smaller, less expensive home, you shouldn’t expect to get a high return on your investment. Likewise, if you spend less than 6% and you have a million dollar home, you aren’t spending enough.

• Entry Door Replacement ($1,162): 96.6%

• Deck Addition ($9,539): 87.4%

• Attic Bedroom Addition ($49,438): 84.3%

• Garage Door Replacement ($1,534): 83.7%

• Minor Kitchen Remodel ($18,856): 82.7%

Estimate the Costs

http://www.remodeling.hw.net/cost-vs-value/2014/


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COST OVERRUNS Unfortunately, you have to plan for the contingencies

Unfortunately, you have to plan for the contingencies. Most construction projects run into unforeseen challenges, costly delays, or other setbacks. You should add 15-20% to your budget to account for contingencies. If that number falls outside of your available funds, it’s probably time to scale the project back a bit.

Get Quotes

Getting quotes from multiple contractors is an incredibly important part of a successful remodeling budget. Once you know the exact scope of your planned projects, how much you have to spend, have a good esti-mate for what the project will cost, this part will be a lot easier.


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Getting quotes from multiple contractors is an incredibly important part of a successful remodeling budget. Once you know the exact scope of your planned projects, how much you have to spend, have a good estimate for what the project will cost, this part will be a lot easier.

Prioritize Projects & Trim the Budget Based on Priorities

When it comes to remodeling, many homeowners have numerous changes they’d like to make. Unfortunately, this may not always be possible, especially when adhering to a restrictive budget. It’s vital that you prioritize your budget based on what projects you most need or want to complete.

Priority projects can include necessary repairs, such as those made to kitchens or bathrooms. Without these repairs in place, your home’s value may decrease rapidly, as well as creating a less-than-comfortable environment for you and your family. While it may be tempting to perform a number of repairs at the outset, focusing on the most important ones will allow you to use your money wisely.


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Keep Your Budget on Track

Scope creep, the unintended growth of your project’s scope (size and cost), is your budget’s worst enemy. Scope creep is caused by poor planning and adding unplanned extras to the project. Setting a budget and sticking with it should be simple, but it usually end up being harder than most people think.

Once your remodeling budget is in place, create a spreadsheet to record expenses and track your budget, and look at it often. This way, you will be able to quickly spot cost overruns and make adjustments accordingly.

So, what should you remodel and what will it cost?

Two of the most popular remodels are the kitchen and bathroom. Most kitchen remodels cost between $19,000 & $55,000 and the average bathroom remodel costs $16,128. Depending on which parts of the room you decide to update, costs will vary.


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KitchenOpening up the kitchen

Removing walls between a kitchen and adjoining rooms is one of the hottest trends in remodeling. Opening up your kitchen creates more space and dramatically changes the look and feel of your home. Having and open concept kitchen makes the flow from room to room more appealing and turns a kitchen into a space where families are more comfortable cooking and eating, and socializing as well.

Hardwood Flooring

The popularity of open concept kitchens is also leading to more hardwood in kitchens. As homeowners open their kitchens into other rooms, they are adding hardwood floors to match the flooring in adjoining rooms. By matching classy hardwood floors, they can increase the flow from room to room.

Granite & Quartz

Granite and quartz countertops are pretty much tied at this point for the top spots in countertop materials. Both offer a great look for any kitchen and are very durable.

BathroomCurbless Showers & Soaking Tubs

Curbless showers create a seamless transition from the shower to the rest of the bathroom floor that homeowners prefer. They are also choosing free standing, non-jetted soaking tubs when they have the space in their bathroom. When they don’t have the room, homeowners are ditching bathtubs all together and expanding their shower.

Multi-head & Steam Showers

Homeowners are opting for larger, more open showers to increase the spa-like feel of their bathrooms. They are also choosing expensive multi-head and steam showers to provide added luxury and functionality.

Floating & Dual Vanities

Dual vanities are growing in popularity. Homeowners want his and hers sinks and vanities, even in smaller bathrooms, that allow each person to have their own space and storage. In addition, bathrooms are increasingly incorporating floating vanities that allow more room to walk around, make the space feel more open, and show off high end flooring.

Some ideas for each are as follows:


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Stainless Sinks

Stainless steel is still the most popular sink material. Porcelain enamel and granite composite sinks are growing in popularity though.

Pullout Faucets

Pullout faucets still dominate the market. Touch-activated faucets are growing in popularity as well.

Radiant Heat

Imagine walking into your kitchen in the morning and not being shocked by cold tile floors. Adding radiant heating will create that extra level of luxury and increase the value of your home.

Floating & Dual Vanities

Dual vanities are growing in popularity. Homeowners want his and hers sinks and vanities, even in smaller bathrooms, that allow each person to have their own space and storage. In addition, bathrooms are increasingly incorporating floating vanities that allow more room to walk around, make the space feel more open, and show off high end flooring.

Lighting

Bright, airy bathrooms with plenty of natural lighting are in high demand. Many homeowners are adding windows and skylights to enhance the lighting in their bathroom. Using new LED lighting and high-end accent lighting is also very popular as well as adding a fireplace where possible.

Radiant Heat

Radiant heating is becoming increasingly popular in bathrooms. It’s a great way to add spa-like comfort to any bathroom and feels great on cold winter days. Electric radiant heating systems are affordable and easy to install and will greatly enhance your comfort.

Use the attached worksheets to create a budget that will work for your project. For more information on flooring renovations, budgeting, or to answer any

questions you may have on radiant heating, send us a message today.

http://www.summerstep.com/resources/contact


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Total Budget

Cabinetry & Hardware 29%

Installation 17%

Appliances & Ventilation 14%

Countertops 10%

Flooring 7%

Walls & Celings 5%

Lighting 5%

Design Fees 4%

Doors & Windows 4%

Facets & Plumbing 4%

Other 1%

$

$

$

$

$

$

$

$

$

$

$

$

Worksheet: Kitchen Remodeling Budget

The National Kitchen & Bath Association (NKBA) breaks down kitchen remodeling costs by the following

* These figures are guidelines, not rules. Each project is different.


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Total Budget

Installation 20%

Cabinetry & Hardware 16%

Fixtures 15%

Faucets & Plumbing 14%

Flooring 9%

Countertops 7%

Lighting & Ventilation 5%

Walls & Ceilings 4%

Design Fees 4%

Doors & Windows 4%

Other 1%

$

$

$

$

$

$

$

$

$

$

$

$

Worksheet: Bathroom Remodeling Budget

The National Kitchen & Bath Association (NKBA) breaks down kitchen remodeling costs by the following

* These figures are guidelines, not rules. Each project is different.

Real Estate

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