Renovation is a costly project which will put you off to many months of saving. If you are not careful with your budgeting and planning, you could be spending more than you should and could get you into some financial trouble. Hence, if you are planning to renovate your home or any space, you must first ensure that you have enough funds and some extras to go about.
Budgeting for your renovation project
Budgeting for renovation is determined by the scale of the project. You have to be sure of your own affordability which will then determine what you could and could not do. If you are planning to renovate the entire house without building any extensions or tearing down any, then you should be allocating around RM100,000 or more because it usually requires repairs and such.
If you are moving into an entire new house where there is only minor renovation like tiling and paint-jobs, then RM100,000 would be a feasible amount. Take note that it will be most appropriate to always have a buffer of 25% more of the budget to play with.
Survey for Material costs
In most cases, material costs do not change very much. In fact, pricing for tiles and paint usually is quite standard where they vary in terms of brand and quality. The best practice to keep the material cost as low as possible is to shop around yourself and make price comparisons. It is not advised to let the contractor purchase all the material as some might earn additional mark-ups.
Remember that the common practice in the market is that you buy the material and the contractor will install them. If you allow them to buy the material, ensure that you actually purchase them together.
Watch out for Hidden costs
In some situations, there are hidden costs that you might not be aware of. This includes expenditure for food for the workers as well as travelling further to buy material. Price of certain material might fluctuate and increase like cement or sand although this can be quite rare. Meanwhile, there are situations where you might have to move out of your home with your family during renovation which you might not have expected in the first place.
Looking for a place to stay and the duration of the stay will incur additional expenditure which is where the 25% expenditure will come in handy. The most ideal situation is to have the cash ready but if the situation requires, you might be able to obtain a renovation loan from certain banks that provide such facilities.