When it comes to home improvements, knowing what you want is the easy part, the tougher part is figuring out how much you can afford. All renovations can add up rather quickly. It is very important for you to budget accurately before you start any type of remodel. There are four steps that you will want to follow in order to calculate how much remodel you can afford: ballpark the cost, establish a spending limit, get quotes from contractors, and set your priorities.
Step 1: Ballpark the Cost
First, get a handle on how much your remodeling dreams will cost. In general, major upgrades, such as bathroom remodels or a family-room addition, run $100 to $200 and more per square foot. If you’ll be using a design pro or remodeling contractor, discuss the project with them to get the rough idea of the costs.
Step2: Figure Out How Much You Have To Spend
Once you’ve zeroed in on a project, the net question is whether you have the money. If you’re paying cash, that’s easy to answer. However, if you’re borrowing, you will need to assess how much a bank will lend you and what that loan will add to your monthly expenses. For the vast majority of homeowners, the best way to borrow for a home improvement is a home equity line of credit. A HELOC is a loan that is secured by your home equity, which means that it qualifies for a lower rate than other loan types, and you can deduct the interest on your taxes.
Step 3: Get Quotes from Contractors
Before seeking bids, determine exactly what you want, right down to the kitchen countertop material and type of faucet. By specifying these details up front, you ensure that prospective contractors are all pricing the same items.
Consider getting recommendations for at least three contractors from friends, neighbors, and other tradesmen that you trust. Give each one your project description and specific product lists and request an itemized bid. To find the right contractor:
- Ask to see their recent work
- Check references
- Look at online sites that provide peer reviews of contractors
Take the winning contractor’s bid and add 15-20% contingency for the unforeseen problems and changes that occur on every project. Is the total still within your ability to pay? If so, you’re ready to get started. If not, it’s time to scale back your plans.
Step 4: Set Priorities and Trim the Project to Fit Your Budget
Dreams and budgets not in alignment? Carefully scale down your dream – chances are you’ll end up satisfied and solvent. Enlist your contractor for suggestions on cutting costs – that way he or she will be an ally in helping you stick to your budget.
Possibilities include:
- Low-cost alternatives
- Keeping older items that are still in working condition
- Making the project smaller
- Buy it yourself
PlumbTile can help you with your remodel, from helping you find items within your price range to offering advice on contracting and how to get the remodel of your dreams.