It can often be exciting to remodel your home and update the property to increase its level of appeal. One of the most important parts of the process is budgeting for the remodel to ensure that you have the necessary finances. If you want a smooth and efficient process, Alair Homes Brandon offers a few steps to budgeting for your project.
Create a Realistic Budget
Avoid basing your budget off of the prices that are often available on TV shows. Prices from TV shows can be unrealistic due to contractors that trade their services to be included on the show. It’s fair to assume that the cost of the remodeling project will be more than you expect.
Ask your family members and friends about how much you should expect to budget based on their experience. Ask people who have recently completed projects due to pricing that can change over the years.
You’ll also need to have money set aside for unexpected costs or expenses or if you change your mind on certain features in the middle of the process. 20 percent of the budget should be set aside for an increase in cost for certain parts of the project. Avoid using the contingency for upgrading the countertops or for expensive fixtures.
Remain Flexible
Many homeowners run into the issue of not having enough money for the entire remodeling project. Remain flexible by changing the scope of the project to reduce the costs. Instead of constructing a new bathroom in your basement, you can start the project and plan to finish it at a later date when you obtain more funds. You can also consider choosing basic materials to install instead of fancy products that cost more.
Know What You’re Paying For
You’ll need to communicate effectively with the team of contractors and subcontractors to ensure that you know what you’re paying for. Hard costs include the cost of fixtures and construction materials that are used. The soft costs that you’ll need to pay for involve designers, permits, and consultants. Everyone should be on the same page with the budget and numbers to avoid complications or issues. A contractor may quote you $600,000 for a new house, but it doesn’t mean that the soft costs are included in the estimate, making it necessary to review everything with the professional to avoid any surprises.
Set Priorities
If your dreams and budget are not in alignment, it’s important to make a list of priorities to ensure that the necessities are covered before you begin spending money on upgrades or luxurious materials that you want installed. Consider low-cost alternatives and buying some of the products yourself to save up to 20 percent of the costs. Making the project smaller will also help by trimming down the size of a new bathroom addition or deck addition.
Determine How Much You Have to Spend
If you’re not planning on paying cash for the remodeling project, determine your finance options. The three basic types of loans that you can consider include a cash-out refinance, a home equity loan, or a home equity line of credit. Establish your repayment schedule to ensure that the payments are made on time in the coming years.