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Homeownership comes with many a perk – as well as many a headache. Sometimes the two go hand in hand. Home renovations, for example. The two are so entangled it’s virtually impossible to separate them. You get the joy of molding your personal space to work better for you while increasing the value of your home, but it comes at a price; usually a very high price. There’s nothing more migraine inducing than budgeting. Add all the other decisions and dilemmas that come with renovation and it’s a pain in the neck just thinking about it. But it doesn’t have to be that way. Follow these tips on creating your budget for smoother sailing through your renovation.

Home Appraisal

Appraisals are vital information for you and your lender. Houses go through appraisal processes during a sale, but they also inform your lender on how much you can borrow for home renovations. The value of the home against your current mortgage and any other liens on the house (such as existing Home Equity Lines of Credit or a second mortgage) will determine what you can borrow without adding too much financial strain. Not all banks or lenders require an appraisal for renovations, but they certainly help. You never want to borrow more than you can comfortably payback. Aside from HELOC there are also Home Equity Loans (an upfront sum) and credit card offers. Explore your options and choose what’s best for you.


It’s never too early to begin researching. The internet is a wealth of information, especially when it comes to generating an idea of what you’re likely to spend on your particular task. General searches are a great place to start. Cast a wide net and as you pull information, you’ll find smaller, more specific things to research, such as materials, labor, etc. Expand your search to also include talking to friends and neighbors about their renovations, who they hired, what they spent, etc. Peruse the aisles of home improvement stores on a lazy weekend to gauge prices of materials, fixtures, and appliances.

Window shopping never hurt a soul. But a word from the wise: never buy materials before beginning the reno. It’s nice to find a sale, but if you don’t buy enough and then can’t find more of that material when you need it, you end up spending twice what you should on a new material. Avoid the temptation. Your wallet will thank you in the end.

Small Stuff

You’ve got an idea of what it’ll cost in general, you know how much you have to spend, now it’s time to get super specific. The smaller things like needing to rent a storage unit or stay overnight in a hotel will need to be factored into the overall budget. If you’re doing a kitchen or laundry reno, talk to your contractor about the access to your kitchen and add in the cost of eating out. They seem like small things, but added together they create quite the expense. With kitchen renos in particular, buying groceries that facilitate quick and easy meals will also help reduce stress and spending.

Emergency Fund

Don’t finalize a budget without it. In fact, before accounting for anything else, set aside that 20% of your entire budget and then go from there. Never, ever, ever, create a budget without an emergency fund. You may or may not use it, but of all the things to have and not need rather than need and not have it’s an emergency fund.

Line Item

Once you have your contractor and you’re settling the final details, itemize your budget down to the penny. Put it all in a spreadsheet, print copies for you and your spouse, and your contractor. Have it by your side and ready to access at all times. Tracking your budget throughout the process is the best way to stay on target and avoid the pitfalls of renovations.



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