How to Create a Renovation Budget

Maybe you’re thinking about renovating your home before listing it for sale on the Nanaimo real estate market. Or perhaps you plan on staying where you are because the location is absolutely perfect. In either case, the first step in renovating is to create a renovation budget.

In this article we’ll take you through the steps to create a renovation budget and also show you how to save some money.

How to estimate the cost renovating your home

Mark Cooper, a director of the Greater Vancouver Home Builder’s Association, was recently quoted in the Vancouver Sun as saying that “most interior-only renovations come in at about $100-$125 per square foot. Add in some new windows and exterior work, and that jumps to about $150.”

Renovating vs. buying a new home

Even if you plan on keeping your home forever, any renovation project should still proportionally add value. As a rule of thumb, you shouldn’t spend more than 10%-15% of your home’s value on a single room. For example, if your house is worth $500,000 then the maximum you’d want to spend on a kitchen renovation is between $50,000 and $75,000.

Figuring out where the money for renovation will come from

Before you decide what to spend your money on, you’ll need to determine where the money for your home renovation will come from. The answer is easy if you’ve got cash saved. Other ways to fund your project include a cash-out refinance or a home equity loan. Your real estate agent can give you a good idea of what homes comparable to yours are worth in the current Nanaimo real estate market and how much equity your home has.

Steps to create a renovation budget

Now you know where the money is coming from. Next, follow these steps to create your perfect renovation budget:

• Determine the scope of your renovation project and timeline: start with your dream list by walking through each room and making a complete list of repairs and updating. You can always narrow it down later if you need to.
• Decide if you want to be your own general contractor: a general contractor, or GC, is the one who manages all the specialty subcontractors like electricians, plumbers, and cabinet makers. Doing this will save some money but will also take up more of your time.
• Interview and get quotes from several contractors: ask a lot of questions and always make sure you have enough details from each bid to compare apples to apples.
• Set a renovation budget based on your estimates: make it as detailed as possible and be sure to include everything down to the last nail or screw.

After that, it’s time for your home renovation to begin!

4 ways to save money on home renovations

There are ways to save money on your home renovation without cutting corners. Some of the most cost-effective include:

• Doing demolition work like removing old cabinets and tile yourself
• Ordering finishings and fixtures yourself
• Doing your own painting
• Shopping for used and refurbished items instead of brand new

Four things to remember when renovating your home

1. Do a ballpark estimate on the costs: interior-only renovations start at $100-$125 per square foot while windows and exterior work begins at about $150.
2. Decide how much money you have to spend: cash or getting funds for renovation through a cash-out refinance, a home equity loan, or a home equity line of credit (HELOC).
3. If you’re not doing a DIY home renovation, get quotes from contractors, being sure to look at their recent work, and check references.
4. Prioritize item you want renovated and if necessary, change the project to fit your budget by using lower-cost alternatives or keeping items that still work.

Author Bio: I'm an experienced and enthusiastic Realtor & I define 'full service' as 'going above and beyond' for my clients. As your Realtor, I will be an advocate for you. Whether you are buying or selling I will work tirelessly to promote your best interests