by Matt Hermes
on Tuesday, March 3rd, 2020 at 11:06am.
In my profession, I’ve seen many people fail in their renovations simply because they ran out of time and money. It’s heartbreaking — and so easy to avoid. Most people don’t realize that the majority of their success relies on their ability to plan well at the start. Here are my top tips for keeping your budget on track throughout your renovation.
Break It Down
Whether you’re renovating for profit or pleasure, it’s very easy to underestimate the costs involved. If your budget blows out, you’re not going to be able to afford those finishing touches that can be so important to the end product.
During the planning phase, break down your budget in detail — this way you’ll be less likely to exceed it during construction. It will also allow you to be realistic about what you can and can’t achieve. And don’t forget about hidden renovation costs, such as demolition and site cleanup.
Plan for the Worst
Doing a phenomenal property inspection is so essential. If I hadn’t carried out thorough inspections in some of my own renovations to discover things such as asbestos and incorrect plumbing, there’s no way I could have made the profit I have.
But remember, always expect some surprises and plan for them, no matter how good an inspection you undertake.
Don’t Get Demo-Happy
Don’t go into every renovation thinking that everything needs to be ripped out. Too often people are so eager to tear things out that it’s almost as though they’re suffering from demolition fever.
One of your first steps when putting together a renovation plan is to see what’s intact and can stay. It’s a fine line, obviously — you need to make sure you aren’t being sentimental and going too far with the restoration and associated costs. But if those existing bathroom floor tiles will work with the new look, why remove them? Products and time are money.
Here are some questions to ask yourself:
Can you keep the same kitchen, bathroom or laundry layout so you don’t have to go to the expense of moving pipes and electrics (which can be costly)?
What can you update with a fresh coat of paint?
Can you update kitchen cabinetry with new handles?
Can you rejuvenate existing wood floors?
Build In a Cushion
Even after 114 renovations, I still don’t know exactly what’s concealed behind the walls in the projects I take on (and this is even with extensive property inspections). So a buffer in your budget is essential, no matter how experienced you are.
Sometimes things happen that are simply beyond your control. You can’t just turn a blind eye to them because they weren’t jotted down in your original budget. And sometimes you won’t be able to pinch those couple of thousand dollars from another section of your budget without affecting the outcome of the final space.
When unexpected things happen, that’s when your buffer cash comes into play. As a minimum, I would recommend setting aside 15% of your total budget for unwelcome surprises.