Considering a big home renovation? When it comes to home improvements, knowing what you want is the easy part. The tougher question is figuring out how much you can afford.

Here’s how to set your priorities, establish a spending limit and stick to your budget.

1.   Determine your goals.

Why do you want to renovate? Are you remodeling your kitchen because you want more counter space? Do you want to create an open floor plan? Are you tired of not having enough space to entertain guests? Figure out what your goals are and then figure out your budget.

2.   Drill down to specifics.

Determine the professionals and equipment you need. Do you want hardwood floors or carpet? Black or stainless-steel appliances? Providing a contractor with a list of exactly what you want can help you formulate an accurate budget.

3.   Assess your financing options.

Unless you’re going to pay for all remodeling expenses with cash, you’ll need to borrow money for the project. You may also want to consider resale value.

If you’re planning to stay in your home long-term, it may make sense to splurge to create your dream space. However, if you’re thinking about selling the home within a few years, focus on your potential return on investment.

4.   Get Estimates.

Research professionals. Ask friends and family for references. Look at reviews online. Renovations can cost a significant amount of money, and you want to make sure you spend it wisely.

Call three professionals of every type and ask for cost estimates. Be sure to give all three the same list to estimate. You want renovation cost estimates that are comparable.

5.   Set aside money for surprises.

Set aside an additional 10 percent to 15 percent in cash to accommodate hidden expenses.

6. Consider Cost-Saving Methods.

There are ways to trim your budget without sacrificing the quality of the workmanship.

Examples:

·        Refurbish older items
·        Opt for lower-cost finishing.
·        Tackle small tasks yourself.
·         Resist adding things along the way.

 

I hope that this guide can help you get the renovation you want at the price you can afford.

Good luck! J

Sources:
How To Create A Renovation Budget
How to set your budget for a big home improvement project