Search

6 costs to consider when setting a renovation budget

Updated: Nov 5


There are different ways to renovate which will affect how you manage costs. A builder with a contract means the cost is fixed. But if you choose to DIY, then you’ll need to manage the budget yourself. So let’s look at how to master your renovation.


Setting some money guidelines for your home improvements makes a lot of sense. A renovation budget shows how much cash you’ll need at various stages of the project, prevents the heartbreaking situation of having to put renovations on hold if you run short of funds and can be the deciding no vote against the $100,000 chandelier you once saw in a Taylor Swift video. Let’s take a look at the key costs you need to plan for in your renovation budget.

1. Materials

Building materials can be surprisingly expensive – and definitely worth budgeting for. Use the internet to shop around and compare prices, and above all, know exactly the quantities you need. Measure rooms carefully for things like floor coverings or tiles so you’re not wasting money on excess supplies or cutting yourself short by ordering insufficient quantities.

2. Labour

Good tradespeople don’t come cheap but you can trim the cost by getting quotes from a variety of different builders. Be very specific about the work you want done so that everyone is working off the same page when a quote is drawn up. Try to avoid changing plans midway through the project – this can seriously blow your budget.

3. Equipment

If you’re doing all or part of the work yourself, don’t forget to include the cost of equipment hire. It can work out cheaper than buying gear that you may never use again.

4. Council permits and plans

It’s easy to overlook the cost of development applications (DAs) and other permits. Yet these can add several hundred dollars or more to your renovation budget. Speak to your council to know exactly what costs you’re up for to comply with local regulations.

5. Have a slush fund for emergencies

Renovating can dish up some surprises, and it pays to make allowance in your renovation budget for the occasional curve ball. The imported tiles you love may rise in price overnight, or the builder could hit a rock while excavating for retaining walls. Whatever the case, your renovation budget should include room for unexpected cost blowouts. Hopefully they’ll never happen, but at least you’ll be prepared if they do.


6. Weigh up your finance options

Part of setting a renovation budget involves weighing up the costs of funding your project. If you have cash savings, tapping into this nest egg lets you avoid interest charges.


However, for larger renovation projects it may be essential to borrow funds and a number of options are available. A personal loan has the advantage of a fixed term, so you can easily budget for the regular repayments – but be sure to shop around for a competitive rate. Your home loan will almost certainly have the lowest interest rate of all types of debt, and drawing on home equity to fund renovations can be done by topping up your current loan or refinancing to a new home loan altogether. By paying a little extra off your loan each month, you’ll reduce the long-term interest charge of your renovations and pay off the debt sooner.

A well thought-out budget makes renovating easier

Drafting a renovation budget before you get started will give you a clear idea of the true cost of your project, helping you see if you can comfortably fund the works you have planned, and if necessary, show areas where you could cutback to make the renovation more affordable.


Your Choice Mortgage Brokers Pty Ltd ATF Halo Innovation Trust trading as Heart Mortgage Services - Australian Credit Licence 38643


The information contained herein is of a general nature only and does not constitute advice. You should not act on any information without considering your personal needs, circumstances and objectives. We recommend you obtain professional financial advice specific to your circumstances. The views expressed here are not ours. While the information contained in this article may contain or be based on information obtained from sources believed to be reliable, it may not have been independently verified. Where information contained in this publication contains material provided directly by third parties it is given in good faith and has been derived from sources believed to be accurate at its issue date. To the maximum extent permitted by law: no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up to date or fit for any purpose; and no party or associated entities as mentioned is in any way liable to you (including for negligence) in respect of any reliance upon such information. This article may also contain links to websites operated by third parties who are not related to us. These links are provided for convenience only and do not represent any endorsement or approval by us.

7 views

Our Services

Heart

Townsville & Rockhampton

Heart Financial Advisers       Heart Mortgage Services       Privacy Policy        Financial Services Guide       Credit Guide       Complaints Process

 

Stu Varidel and Your Choice Financial Planning Pty Ltd ABN 80124246877 trading as Heart Financial Advisers are authorised representatives of Sentry Financial Services Pty Ltd ABN 30 113 531 034 & AFSL 286786

 

Your Choice Mortgage Brokers Pty Ltd atf Halo Innovation Trust trading as Heart Mortgage Services - Australian Credit Licence 386437

 

Disclaimer 

The information contained or referred to on this website has been compiled for the convenience of our clients, looking for information about us and the services we provide both financial advice and credit services. We have taken all reasonable care in preparing and presenting this information, but we cannot warrant that it is complete and/or accurate in all respects or fully up to date. We are not responsible for any eventualities arising from the use of the information in this website for any purpose whatsoever.

 

General Advice Warning The information provided on this website has been provided as general advice only. We have not considered your financial circumstances, needs or objectives and you should seek the assistance of your Adviser before you make any decision regarding any products mentioned in this communication. Whilst all care has been taken in the preparation of this material, no warranty is given in respect of the information provided and accordingly neither Heart Financial Advisers and Heart Mortgage Services nor its related entities, employees or agents shall be liable on any ground whatsoever with respect to decisions or actions taken as a result of you acting upon such information.

Level 1, 25 Sturt Street, Townsville, Qld, 4810

PO BOX 207 Deeragun, Qld, 4818

1300 861 143