Home renovation can be a rewarding task. For some, it's about flipping a house for profit. Others are looking for a deal in which to invest time and effort. Another reason to renovate is creating a uniquely tailored space.
But renovations have their downsides, particularly when homeowners don’t invest enough time into planning. They’re not something you design on the fly, making it up as you go along. Nor can plans be vague: you owe it to yourself to decide on the time, skills and money necessary to finish your project. The results will be worth it.
Making the Budget
First, set an overall budget. No one is made of money. Decide how much you can reasonably dedicate to this project, then stick to it. Exceeding the budget “just this once” rarely, in fact, happens just once. There are tons of options that can lead you financially astray, so you need to spend serious time on your budget.
Identifying Areas of Improvement
In order to make a good plan, you need to identify the right renovations for your home. Most people can't renovate every room in the house, so you need to be selective. There are two major things to focus on. The first are things that need the most attention. Safety issues, of course, come first. Past that, it’s things that don’t work correctly, are painfully outdated, or are just plain unappealing to look at.
The second major focus is on those things which will return the most on your investment, such as replacing vinyl siding, garage doors, windows or the roof. Adding attic insulation is also a solid investment. These practical - and relatively economical - improvements have a far greater ROI than, say, a complete bathroom remodel. Which is not to say you can’t remodel the bathroom. But do so with the understanding you’re doing it more for personal enjoyment than as an investment in your home.
Now that you have an idea of what you want, you need to figure out how much it will cost. This is possibly the most difficult aspect of home renovation. It's easy to remember the big stuff, like pricing out the new kitchen tile, but don’t forget about the cost of prepping the subfloor, or new baseboards to match the tile, or new crown molding to match the baseboards. Likewise, the cost of a single handle may seem small, but the price grows quickly when you replace them on every door in the house.
Professional Services or DIY
And while some renovations may be a DIY project, be honest about your skills. Being handy with a wrench doesn't mean you can safely install new plumbing or run electrical wires or repair a roof.
Working beyond your skill set is both dangerous and costly as you damage material and then need someone else to clean up your mess. Some jobs simply need professional installation. Be honest about it and factor in the labor costs.
And while you may be thinking of all the ways to save a buck, don’t be afraid to splurge when appropriate. It’s not a bargain if you have to repair or replace materials after a few years. And cheap things sometimes look cheap, and that’s not going to attract a future buyer.
Creating an Emergency Fund
Finally, don’t forget to set aside a little extra cash in case something goes wrong. Maybe you discover wood has rotted, or the attic is full of mold, or the pipes just aren’t in as good of condition as you thought. An emergency fund lets you handle these surprises with a minimum of pain.
Home renovation is a major undertaking. Give the project a firm foundation by creating a detailed budget which includes a solid estimate of all the costs you expect to incur. Many renovation projects are never completed precisely because of a lack of planning. Projects which run out of money end up being halted entirely, leaving owners with half-finished homes. A well-planned project will leave you with a much improved home with greatly increased value.