Hidden Renovation Costs That Could Blow Your Budget
You love your home, but it’s time for a facelift. Remodeling is a big investment and it can disrupt your daily life for months or longer. Before you start knocking out walls, make sure you have carefully planned your renovation project by getting a contractor’s estimate up front. However, pay close attention to the bottom line. There very well could be costs NOT included in your contractor’s bid.
Many times a remodeling contractor may be less than honest about costs. They want to win the job, so they come in with a lower bid, knowing that the budget will probably be exceeded. Keep in mind, things don’t always go as planned. And once you’re in mid-project, it’s very hard for a homeowner to not ante up more funds to complete the renovation. More often than not, your budget will be a distant memory as costs soar.
This can be avoided by seeking a reputable contractor and demonstrating personal involvement in the project. Pay close attention to the step-by-step process of the renovation and the hidden costs that don’t always get included in an initial estimate.
Building Permits & Code Violations
Most home renovation projects require building permits and regular inspections to ensure the project is up-to-code. If you’re working with a contractor who is telling you that permits aren’t necessary, proceed with caution. Even if you’re doing interior work on your home, permits may be required.
Permits are designed to outline building codes that must be met for any project while also protecting homeowners from unsafe construction. You’ll have to factor in the cost of regular inspections. Contact your municipality for more information about permits and their associated costs.
Keep in mind, the cost of permits for a renovation project may not always be a fixed amount, but rather a percentage of the total renovation cost. This depends on where you live, so do your research before you break ground. Make sure the project is completely in line with local building codes. If code violations are pointed out after the work has begun, your wallet will take a hit.
Higher Property Taxes
Major additions or updates, particularly in spaces such as kitchens and baths, can increase your home’s assessed value, and that can enlarge your tax bill. Assessors typically get copies of building permit applications, so they’ll know about your project and may determine that it warrants upgrading your home’s value. Note that it’s not necessarily based on the additional square footage. You’ll see the higher taxes in the valuation of your house for the next tax year.
Be prepared, demolition could reveal a colony of creepy creatures lurking beneath your drywall. A project can be halted until pest control experts can rid your home of insects and vermin. You never truly know what’s going on behind the walls until they are torn out. Also, the discovery of mold, faulty wiring or plumbing or asbestos can be pricey pitfalls.
If you are renovating an older home, there’s a good chance it contains either lead or asbestos. Lead paint was common in homes built before 1978; asbestos was used for fireproofing and insulating until the mid-1970s. If lead paint and/or asbestos exist in your home, special steps will need to be taken to make sure these materials are properly dealt with BEFORE you start renovating. Contact your local Environmental Protection Agency (EPA) to find a local contractor who is certified to handle these types of materials.
Hidden Problems That Drive Up Home Renovation Costs by Wallside Windows
A renovation team brings a good amount of table saws, nail guns, paint sprayers, floor sanders and other tools that require your electricity. Plus, there will be heavy traffic in and out of your house. Your heating/cooling and electric bills are going to climb considerably during your project.
If your project includes a kitchen remodel, you could be without a stove, oven or even fridge for quite some time. You can spend a small fortune on restaurant meals and takeout in the meantime. If you have to throw out all of your pantry supplies that passed their expiration date, you will have to spend more on restocking spices, baking supplies, and so on.
5 Hidden Costs of Remodeling by Bob Vila
Make sure your estimate includes the costs of the removal of construction debris and waste, as well as fees for a final cleanup of your property. Check bids from room addition contractors carefully for details on the contractor’s fees for managing debris removal, the extent of their responsibility for this, and how and by whom containers will be paid for. Reviewing the contract is also a good time to check on local ordinances that pertain to waste disposal.
Don’t be shocked to see dumpsters and portable toilets in your contractor’s estimate. They help the crew maintain a clean job site and cause as little disruption to your home as possible.
Adding a Room? Don’t Forget These Costs by Contractor Connection
Expecting the Unexpected
Talk to anybody who’s survived a renovation and they’ll tell you to prep for curve balls. Demolition, whether it’s on an older home or a relatively newer home, will reveal everything from structural problems to leaky pipes to fire damage that’s been covered up by previous owners.
With the likelihood of surprise, most professionals recommend between a 10 and 15 percent contingency based on your original budget. Get yourself in the mindset that the process is a leap of faith that’ll be worth it after all is said and done. Give yourself a little extra cushion when it comes to funds to be prepared ahead of time for any bumps in the renovation journey.
7 Hidden Costs in Renovating a Brownstone by Emily Nonko
Maintaining a Budget During New Construction by Michael Roberts
Top 14 Home Renovation Mistakes and Ways to Avoid Them by Anita Clark
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Written by Client Care Marianne McGinnity on March 14, 2017.