How to budget for a house renovation?

A major home renovation doesn’t necessarily have to sting in the pocket book if you take proactive steps to budget accordingly for the scope of the project.

By working with a custom home builder who you trust, you can make very granular decisions about the specific steps you need to take in renovating your home. Some clients may get a sense of sticker shock from the initial budget estimates, but it is critical to develop a comprehensive snapshot of each and every cost that must be considered. Working with a trusted advisor (like Powell Custom Homes) can demystify the process of creating a budget for your project and allow you to make informed decisions about trade-offs you are willing to make in pursuing your vision of what you want your family’s home to look like.  

This budget process will compel you to get very specific about the kinds of materials you want, such as whether your budget can absorb the cost of hardwood floors in a particular room or marble tile in the kitchen. The budget will also drive your decisions about finance options to pursue, such as if you can readily qualify for and want to pursue a home equity line of credit to use your home equity to finance some parts of the project – or alternatively a loan or other financing option.  

The budget process will also compel you to consider the ultimate potential resale value of your home. What investments could you make in your home – be it embedded smart technology or nice touches like kitchen backsplash – to increase your home value over the long run if you are considering selling it someday.  

Finally the period leading up to your home renovation is likely a period for you to tighten your belt a bit, cut some costs, and devote considerable savings to the unexpected surprises that can come your way throughout the journey of renovating a home.