Renovating a home is not much like what is shown on television. Often times, you might see an unexpected setback or two and the price will go up. These unexpected problems can really burn through a budget and cause headaches. What can any homeowner do to prepare for potential problems that may creep up?
We asked members of the Forbes Real Estate Council for ideas to help homeowners understand what to expect during home renovations.
1. Set The Rules And Get Recommendations
First, know your budget and stick to it. Make sure your contractor knows there is no wiggle room. Setting these expectations is a priority. Second, get recommendations for a contractor from neighbors, friends and local real estate agents. Ask for firsthand accounts of how the experience went, including costs and timelines. - Michelle Ames, HorsePower Team Texas/Independent Realty
2. Make A Plan And Have A Cushion
Many remodeling projects go over budget because clients change their minds or don't plan for unexpected issues. It's always good to add at least a 10% cushion to your budget to have in case of emergencies. Further, being as specific as possible enables you to estimate costs upfront before you start your job. - Lisa Fettner, ReferralExchange
3. Be Prepared
Always allow yourself a 20% or 30% buffer on top of every final bid, because you never come under budget for any renovation. A great way to keep budgets tight is to set an unachievable low-budget target which forces the contractor (and you) to get creative on how you can cut costs to meet that number. - Engelo Rumora, List'n Sell Realty
4. Add Bench Marks
Homeowners should add into the contractor's standard contract clear timetables for completion of each step of the job. In order to ensure that the contractor adheres to the timetable, a penalty for not meeting the schedule needs to be defined. - Michael Polk, Polk Properties
5. Have Patience And Discipline
Get three bids and add them together. That’s about what it’ll cost. Those with experience may not find that funny. Many contractors want to get you on the hook, but issues stem from a lack of patience and discipline. Take time to craft a well-defined scope of work, select materials/specifications upfront and choose a reputable contractor, and you just might get away with adding only two bids together. - Stephen Clark, Clark Investment Group
6. Be Specific
Home renovations are almost guaranteed to cost more than the contractor's original quote. You have to be extremely specific about what you want done. Have it outlined in the contract right down to the materials that will be used. Something as simple as deciding on a more expensive tile can add up to thousands of dollars in price difference. It’s important to feel confident with your decisions to avoid wanting to add in several minor projects that could delay the completion and ultimately increase costs. Give yourself a 20% buffer on your budget to allow for unexpected issues that could come up. - Kevin Miller, Open Listings
7. RPM: Research, Plan, Minimize Changes
The biggest mistake most people make with home improvements is proper preparation. You can save heartache and financial pain by spending more time planning and researching everything. Omissions, city code surprises, materials prone to price fluctuation, assuming subcontractors will show up every day are common blunders. Little things count: Touch the materials you plan to use. Finally, minimize what you change midstream, as that's often the source of the biggest budget busters. - Kevin Hawkins, WAV Group, Inc.
8. Plan, Or Plan To Fail
When it comes to home renovations, failing to plan is almost certainly synonymous with planning to fail. Set a budget and timeline, do your research and due diligence, and have a back-up plan that includes wiggle room for the unexpected. It can be challenging and overwhelming to try to plan for every step of a renovation, but the more detailed you are in doing so, the more prepared you'll be throughout the process. - James Krueger, Krueger Real Estate