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Renovating a House on a Budget: How To Budget For Home Remodeling

How To Budget For Home Remodeling
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Renovating a house on a budget? Been meaning to remodel your home for some time now? Consider looking at our 7 home remodeling tips so you can stay within budget. 

Houses, no matter how durable they are, require rebuilding or remodeling after some time. Similarly, they require a great deal of budget depending on the part that should be remodeled.

Budgeting for home rebuilding has been a major downfall among property owners. They tend to go on building house decks and others without plans and result in spending all their money even on unnecessary renovations. They also don't keep in mind the ROI has on their investment. Your return on investment is largely based on what your house is worth. (You wouldn’t want to install a $50,000 kitchen in a $200,000 home).

So, if you are planning to start a home renovation project soon, be sure to take note of the following budgeting procedures so you know how to renovate a house on a budget.

6 Ways to Save on Your House Remodel

Renovating a house on a budget? Got a house that needs a little love? Then read on. Just because you don't budget your personal finances (if you don't, here is how to create one), doesn't mean you shouldn't budget for larger expenses like a home remodel.

Depending on how much money you want to save on the model — here are some expert tips that will help you fix up a house on a small budget.

#1: Clean up

Before you make any changes to your house make sure you put furniture and items away (and things are clean). Once the area you are renovating is clear of clutter, you can get a better sense of the space. This will greatly improve the renovation process and help with the process of renovating a house on a budget.

#2: Demolish by yourself

Yes, you can save yourself some considerable money by demolishing yourself (or if you have a friend around, them too). Doing the demo yourself can be tricky though, and is only advisable for the exterior of your home, like a deck.

When dealing with the interior of your home, consult a professional or contractor to do the job.

#3: Talk to a Realtor

Usually, the concept of rebuilding is applied to repairing several house areas which are damaged by calamities or old age. Nevertheless, some homeowners are after increasing property value. Increased property value will improve their asset profile or sell it at higher prices in the future.

If you have this goal, consult a real estate expert about the best home elements that boost its value and build them in the future.

#4: Inspect for Parts to Rebuild

Blind rebuilding or renovation is a homeowner’s pitfall that draws in heavy expenses. The excitement of this project causes them to reconstruct other parts of the house even if they don’t find them necessary. Before setting up your budget, be sure to look for house areas that need rebuilding to avoid excessive spending.

After inspection, it is time for you to start allotting your budget.

#5: Your Funds for Rebuilding

After knowing the right elements to build, you can start budgeting your funds to begin your project. First, know the total amount of the project which is comprised of materials, equipment, and labor if you will hire a builder to do the job for you. In addition to the main construction price, ask for the prices of miscellaneous expenses like building permits and cleaning up the construction site.

When it comes to saving money on home renovations, there are some smart ways to go about this:

  1. When you can do it yourself, go this route. As previously mentioned, if you can demo yourself, do it, if you can paint the walls, grab a paint brush. If you need the help of a contractor, don't be afraid to spend on your greatest investment (your home).
  2. Stay creative. Have an old doorknob? Polish it up, or spray paint it to keep it fresh. Try and find ways to save every penny, because renovations costs can add up.
  3. Check the ROI. While you can't measure the cost of your happiness, you can see what improvements may have of the value of your home. Building an extra bathroom? Your home value can increase is value, that's a good investment.
  4. Plan for home improvement expenses. Don't be afraid to seek a personal loan if it's a worthwhile investment that can add to the value of your home and everyday happiness.

#6: Consider Your Funds

Check your savings at hand and see if the amount is sufficient for your project. In most cases, property owners don’t have enough funds to spend on the rebuilding procedures and they get loans from lending companies.

Several secured loans are offered for individuals using the funds for this purpose. Lenders offer them with fewer documents and with some without collateral that offers value for clients. You can cover the costs with smart lenders that don't charge outrageous interest rates such as Upstart and SoFi. These lenders actually offer personal loans for home improvement renovations, so start there or you can check our recommended lenders here.

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#7: Cutting Down Your Expenses

Many people say that if you want things done perfectly, hire a professional to do the job. However, their expertise will cost you a significant amount of fees. You can, however, cut down your expenses by asking for their offered deals. For instance, some companies extend cheaper labor rates if you will get the materials from their company. In addition, you can also compare different builders’ rates to ensure savings.

How Much Should I Spend on a Home Renovation?

When you are remodeling a house on a budget expect to spend at least one hundred to two hundred dollars per square foot for any renovations desired. Renovating a house on a budget is easier and more affordable when you budget your project by the room.

Is it Cheaper to Remodel or Build a New House?

If you have costs in mind then it is much cheaper to remodel than build a new house. Even a full home remodel will be cheaper than demolishing a building a new home. According to Roger Greenwald, RA, AIA, “”the cost of tearing down and rebuilding will be about 20 percent higher than engaging in an extensive whole-house remodel.”

What is the Difference Between a Remodel and a Renovation?

These two terms are thrown around a lot when it comes to real estate, contracting, and even interior design. However, the difference between then is remodeling means to restore something to a previous state, while renovation typically means to create something new.

Budgeting Your Home is Systematic

Budgeting home rebuilding projects is a systematic process and you need to follow them accordingly to get the utmost savings. These steps are simple, but it takes time to accomplish every task that saves you money. Keep these points in mind and you will have a flawless project that beautifies your home. Renovating a house on a budget doesn't have to be hard.

Remember to make changes that have a big impact, consider small things that make a big difference, borrow and rent tools, and always shop around for the best price.

Do you have any other tips on how to renovate your whole house when you're on a budget? We would love to hear them in the comment section below.

Finance Blog Staff

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