Things are scary right now, there is no denying that. Whether you are quarantined at home or unsure of when you will receive your next paycheck, every single person is being effected by COVID-19. I have been getting so many questions around project budgeting and thought this was the perfect time to lay down some of my tried and true tips. If you are currently in the middle of a renovation or have one planned for 2020, this post is for you!
EVERY project should start with a budget, but who in the world knows how to create one of those anyway!? You're probably thinking, "well, I have no idea what things cost," or "how can I do this project....for less?" I feel ya! And I have some answers.
While every project varies in level of design, scope, size and ultimately construction needs (plumbing, electrical, etc) - I have put together some rough estimates based on project size and type. I will reiterate the word rough here, folks. If you plan to specify gold plated wall tile, this table is not for you. Are there ways to lower these costs? Absolutely. Are there reasons these numbers would get inflated? Yes. But it does give you a starting point of what to shoot for when saving or planning! Also note that this is related specifically to Omaha, NE - I cannot speak to other regions. These numbers do not include things like moving plumbing, moving walls, structural changes or major electrical upgrades. If you live in an older home, I would advise you to add in a higher contingency (I will talk about this later) to account for unknowns you may find during construction.
Okay, now that you have an idea of what your project may cost...now is the time to properly put it into action. There are several ways a project can go South but following the tips and steps below will assist in not letting this happen! And can also save you money!
1. HAVE A PLAN
Whether your project is large or teeny tiny, lay it ALL out. Start with your wants for the project vs. your needs. Gather inspiration images, napkin sketches or anything you have that could help a contractor and/or designer understand the end goal. It's okay if not every detail is figured out! This is a great time to call a designer if you are unsure of the direction or what all needs to be included in this plan. A designer might have some cost saving ideas or point out things you may never have thought of. We've done this before!
2. GET QUOTES
Meaning, call someone that owns a hammer and knows what they are doing. It's impossible to decide if a project is in your budget if you don't know exactly how much it's going to cost. Bids from contractors are typically free, so get 2-3 if you can to compare. Remember that you may not have every detail outlined yet, but this will at least give you a good idea of what your base budget is. It will also allow a contractor to speak to any red flags they see in the project. Example - getting plumbing to a certain location may end up being more costly than what you had thought or removing a wall may require structural additions. All of these will of course have an affect on the cost of the project.
TIP: Most contractors have allowances they will plug in for materials. For instance, one may use $10/sf for tile material (which is high to me). If you have already seen a tile or material you like, give this pricing to your contractor to plug-in. Or at least ask them what allowances they use. This will allow you to really compare apples to apples between your bids...and another reason to get a designer plugged in!
3. CONSIDER PHASING
Now that you have your rough numbers in place, it is time to decide what all you are going to move forward with. Be realistic! If the bids come back higher than you had expected, consider phasing as an option. Phasing a great way to break up the costs of the project over time, while still keeping the overall vision in tact. Be weary with phasing as it can sometimes add more costs in the long run. For instance, every time a painter makes a trip to your house it costs time and money. There is some efficiency in doing it all at once, however that might not be for you. Speak with your contractor or designer on phasing ideas, if it's realistic and logistically how it would work. Phasing can be applied to large or small projects!
EXAMPLE: When my husband and I purchased our home I had a contractor bid EVERYTHING we wanted to do, which included gutting main floor, bathrooms, basement, yard, the whole shebang. Obviously we could not afford to do everything at once so we broke it up by area (kitchen, living room, bathrooms, yard, etc) and have been doing it over time. Having that bigger outline and vision helps TREMENDOUSLY with budgeting in the future years. The basement is being estimated around $20K, which gives us an amount to work towards and save. We hope to conquer that this Summer!
4. DECIDE WHO WILL DO THE WORK
Remember that anyone you have work on or manage your project, you are paying in some way. General contractors typically charge 10% or higher from the overall project budget which covers their overhead, management time, etc. That might not sound like much, but trust me it can add up fast. If you have time and some sort of management skills - taking on some of these efforts (for smaller projects) can save you big money off your bottom line. I will reiterate that this does take TIME....oh and patience :) I really only recommend this for projects that have 2-3 sub contractors involved. For instance, if you are updating your powder bath, there really is no reason for you to pay a general contractor for their time when you can hire your own tile sub, painter sub, countertops, etc. But if you are also worrying about making it to your next meeting, getting dinner ready or kids dropped off to practice...this might drive you nuts. But it is an option and one that I have done many times!
5. INCLUDE THE NITTY GRITTIES
I cannot tell you how many projects get to the final stretches with no money left. If you have a beautiful new kitchen but can't afford to buy the dining table or barstools that fit the space - the project is a fail... and you are left crying. This is why the details must be outlined from the beginning. After you secure your construction bids, sit down and outline all other costs that you may incur. This includes rugs, furniture, accessories, artwork, etc. The things that make a project feel complete! Put your glasses on and start up your good friend Excel. Of course, this is absolutely where a designer would come in handy. I put together budgets for people weekly and could probably do one in my sleep. Typically, I start by discussing the level of quality and price point they want to stay within to ensure what we are budgeting for is realistic. You may want to spend a bit more on a new sectional so it is durable and lasts while table lamps and artwork can come from Wayfair or similar. If you are not hiring a designer, browse the inter webs, pin things you like and start adding them to your Excel document.
TIP: If you do find things you love while browsing, go ahead and add them to your cart but don't complete checkout. Thanks to Google and the aliens watching over us, the manufacturers will automatically shoot you an email if that item goes on sale or is about to be out of stock.
6. ADD A PROJECT CONTINGENCY
In the construction world, there is a term project contingency that you may hear. This is really a fancy term for "add more money in for when shit hits the fan." Like I said before, every project has its quirks and unexpected surprises.... which almost always result in additional costs. So once you have your bids and your nitty gritty outline, add in a contingency to protect yourself when these arise. For a medium sized project (anything over $15,000), a 10% contingency should do the job. Smaller projects can get away with perhaps 5% or less. However, if you live in a 100 year old home and plan to gut the entire main floor, consider something higher than 10% in case you find a body. ;)
A project contingency does not just allow you to cover unexpected costs, but also design upgrades that you may come across throughout the process. Say you are remodeling your kitchen and the designer or contractor comes up with a stellar custom hood design that would make anyone entering your home lose their marbles. If you have contingency in your budget, it makes the decision for this upgrade so much less painful because the money is already there. AND, if you everything goes to plan and you don't need your contingency.... well then you come in under budget and everyone is happy!
7. HIRE A PROFESSIONAL
I am a designer, so of course I believe that hiring a professional is a must for a project. The majority of my clients have never worked with a designer before, and like most, have the notion that designers are expensive and only needed when doing high end design. This is not true (and I think they would agree). A designer has a lot of projects under their belt and can offer design services, but also cost saving options as well. A really good designer should be able to take your dream project or napkin sketch come to life with any budget. There are always opportunities to build something or achieve a design intent in a more cost effective way. You just need experience and a little creativity.... which is where I come in!
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