(RE/MAX Blog)- Planning to remodel? While the total cost of your project will depend on its scope, materials and the fees of any professionals you hire, here are some suggestions for beginning to craft a renovation budget.
1. Determine where the money will come from
Will you use savings? Or will you take out a home equity loan? Once you determine your source of funding, determine how much you want to spend on the project – and stick to that limit.
2. Set your priorities
Before you pull out a calculator, clarify your reasons for renovating. Divide those reasons into "wants" and "needs." For example, reconfiguring your bathroom so that your currently questionable electrical and plumbing will pass an inspection is a "need." His-and-her water closets, a whirlpool tub and built-in towel heaters are "wants." Setting priorities will help you make decisions as you move through the renovation process.
3. Step away from the computer
Visit show rooms, model homes and design stores in addition to checking out pictures online. Before investing in materials and appliances, be sure to see and feel them, or samples of them, in person.
4. DIY or contractor?
The biggest question to answer when creating your budget is deciding whether to do the work yourself, or to hire a contractor. Doing the work yourself is usually less expensive – unless, of course, something (costly) goes wrong. Using a contractor, however, can mean your project is completed to professional standards and usually in a shorter time frame. Be sure to calculate the value of your time (and your back and knees) and the inconvenience of having a bathroom or kitchen out of use during the project when deciding whether to opt for DIY or a pro.
5. Expect the unexpected
Whether you plan to do the work yourself or hire a contractor, add on an extra 15 to 20 percent of your total budget for unforeseen expenses. Added costs inevitably arise, especially if you're dealing with an older home.