The cost of any remodeling project depends on two factors size and scope.
In other words, how big is the area you want to change, and how significant do you want the changes to be? Remodeling a small powder room is obviously a simpler proposal than adding a new wing to a house. Likewise, updating countertops is easier than reconfiguring an entire kitchen, which might include replacing cabinets, appliances, and surfaces.
How much will your remodeling project cost? In addition to size and scope, the overall price tag depends on labor and materials costs in your market, whether you hire a professional such as an architect or kitchen designer, and how well you stick to an effective remodeling strategy.
Five Stages of Remodeling
In any project you are likely to encounter five distinct stages of remodeling: planning, budgeting, demolition, construction, and cleanup. With the choices you make at each stage, you can keep your project on track, on time, and on budget.
1. Planning
List and prioritize your wants and needs. Later, after you’ve made your specific materials selections, stick to them. Changing your mind about minor details—this faucet or that door hardware—can cause major delays. Hard- to-get subcontractors may have to be rescheduled, and materials reordered.
2. Budgeting
Ask a couple of architects or contractors for a ballpark estimate on your project. Most should be willing to do this for no fee. You also can ask neighbors and friends what they’ve paid for similar work. But remember that costs can vary considerably by location. Market prices for construction materials can change quickly, too.
The 10 percent to 20 percent fees that architects, kitchen and bath designers, and other design professionals charge may seem like unnecessary costs. However, such experts often catch problems that even experienced contractors or do-it yourselfers miss.
Regardless of the type of professionals you hire, ask for formal and detailed bids, as well as licensing and references.
3. Demolition
Removing such elements as walls and wiring, carpet, and flooring can be tough and dirty work, but you’ll likely save money by doing demolition yourself. This stage may be shorter than actual construction, but just as disruptive to daily life. Make sure to take breakables off walls, and protect furniture from dust and debris.
4. Construction
If your project is a large one, you might want to consider moving out of the house. Temporarily living without cable TV is one matter; living without electricity, heat, or water for even a few days is altogether different. Ask local hotels to quote you a weekly or monthly rate, find a residential or extended-stay hotel that typically serves business clients, or look for an apartment or house to rent for a short time.
5. Cleanup
The work is almost over. Now, someone has to remove the dust and debris before you can enjoy your newly remodeled home. Like demolition, this is labor- intensive work. Offset other costs by doing some of this yourself.
Remodeling Rules of Thumb
-Facelifts are less costly than extensive remodeling.
Paint, lighting, and other spruce-up projects cost less than replacing everything outright. Cover imperfect surfaces with wallpaper or textured paint treatments, update cabinets with new hardware or finishes, highlight previously dark corners with uplighting— you’ll be surprised how nonstructural changes pay off. You can use the money you save on your next vacation—or invest the money in other remodeling elements.
-Borrowing space costs less than bumping out.
Reconfigure existing spaces rather than adding on to your house. For example, you can often find a few extra square feet for a bathroom by stealing space from a linen closet.
-Bumping out costs less than building new.
Often a design professional can safely extend a house by cantilevering it beyond its foundation. The extra 1 or 2 feet might be just enough to prevent the costly foundation and roofing work necessary in a full addition.
How to Avoid Money Mistakes
-Request lien waivers.
In addition to a written contract, a responsible contractor can provide documentation releasing you from financial responsibility for his or her purchase of materials. Otherwise, if a contractor goes out of business, an unpaid materials supplier might be able to place a claim on your property for the materials the contractor used. If unpaid, such a lien could make the subsequent sale of your house more difficult.
- Have your financing in order.
Financing your remodeling project can be just as complex as deciding on floor plans. Saving for a project is desirable. But most experts also recommend using home equity loans or lines of credit, the interest on which is deductible, rather than borrowing against 401k retirement plans, whole-term insurance policies, or other assets. (Consult a financial planner for recommendations specific to your needs.) A home equity loan borrows against ‘the amount of your home’s value, minus the amount you still owe on your mortgage. A home equity line of credit is the same as a loan, except that you don’t have to draw the full amount at any given time.
-Don’t go overboard.
Right after “location, location, location,” there’s a real estate adage that says: You never want to own the most expensive house on the block, nor the least expensive. In planning your remodeling, make sure to balance your wish list against comparable homes in your neighborhood. A luxury kitchen remodeling project, for example, might place your home outside the price range of likely buyers in the future.
By Marc Rein
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