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How to Determine Your Remodeling Budget?

If you have been considering various remodeling projects that need to be completed in your home, perhaps the one hesitation you have is I have no idea how much this is going to cost. It is hard to decide what sort of renovation you can realistically complete without having a figure in mind. Will it be marble countertops and oak floors or laminate countertops and vinyl floors? Most people do not want to bring in a remodeling company without having any idea how much they can spend. If you are already in the process of getting estimates for a job, ideally you know how much you want to spend and have sought out financing if you don’t have the cash on hand for your project.

Some Considerations Before You Make a Budget

Price per square foot for remodeling projects can vary by region, but the average is $100-$250 per square foot. There are many variables, such as the types of materials used for your remodel and what caliber of company you hire for the job (the general consensus is that the cheapest labor is not necessarily the most desirable labor). Other elements that have an impact on your price per square foot are your home’s size (lower square footage means less expenditure), structural changes (they may require the expertise of an engineer), and age (the older a home, the more surprises—not the good kind).   

Regardless of the final figure, be sure to give yourself a safety net of 10-20% in case unexpected expenses arise during your project. An extra financial cushion is especially important with an older home. Finding lead, asbestos, or plumbing and electrical that is not up to code can quickly increase your spending. 

Hidden Costs You May Not Expect

Consider any building permits as part of your expense. If you are ordering your own appliances or other materials, consider taxes, delivery fees, and disposal of old appliances into the cost. If you will have no kitchen or bathroom for the duration of your project, factor in the cost of a hotel, frequent dining out, or setting up a makeshift kitchen. If you have pets that must be boarded during the project, add that cost to your final number.    

Another important financial consideration is your home’s market value. If you are financing your project, most banks will not allow you to finance the full amount of your home’s equity because it is not a sound investment with fluctuations in the real estate market. Should you have to sell your home, you need to be able to recoup what you have borrowed against it. Even if you are paying cash for your remodel, it is generally advised not to spend more than 15% of your home’s value on a single room.  

Remodeling Averages by Room

Here are some averages of room remodels broken down from mid to high range remodels:

  • Bathroom: $14,000-$45,000
  • Kitchen: $30,000-$150,000
  • Basement: $25,000-$60,000
  • Deck: $8,000-$14,000 (Can be higher depending on size)
  • Home Addition: $65,000-$150,000

Breaking Down a Kitchen Remodel

Here is a breakdown of the potential costs incurred during a kitchen remodel (the most popular room to remodel):

  • Design: $1,000-$3,500+
  • Installation: $3,000-$6,000+
  • Appliances: $3,000-$30,000 (From basic to custom installed or commercial grade)
  • Cabinets: $6,000-$20,000
  • Counters: $3,000-$10,000 (Depends on materials and size)
  • Lighting: $1,500-$3,000+
  • Flooring: $3,000-$6,000+ (Depends on square footage and materials)
  • Doors and Windows: $1,000-$3,000
  • Walls and Ceilings: $1,000-$5,000+ (Depends on structural needs and size)
  • Faucets and Plumbing: $1,000-$3,000

There are many factors that account for the wide variations in cost estimates for your kitchen remodel. A basic small kitchen with laminate countertops, vinyl flooring, stock cabinets, and basic appliances is obviously a far cry from a top of the line gourmet kitchen with custom cabinetry, commercial grade appliances, and an island. The number one advice for those grappling with a remodeling budget is to prioritize your wishes and your must-have items. 

Looking for a contractor who will listen to your priorities, so you can achieve your goals while staying within your budget? Contact T.W. Ellis today for a free estimate!

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