Why is my budget always out of control?
You got the house, well done! Being on the property ladder is a blessing but not the end to all your problems. Running over budget can be the most infuriating parts of home renovation.
Too often than not, we all encounter the same renovation mistakes. We like to think that our problems are special, but in reality, it’s happened to a large percentage of homeowners.
8 reasons your budget is always out of control
Smashing through load-bearing walls is a good way to go over budget. It’s a literal example of the knock-on effect. You knock down a wall, expensive structural change ensues. This is rarely worthwhile, so consult a specialist and cost out the ramifications before ramifying your home.
Builders are not chai latte drinking designers. If you don’t explicitly give them written instructions for light fittings and electrical sockets, you may not get the design you hoped for. They don’t have time to walk around every stand at the Home Show, comparing the Feng Shui of each light bulb. Changes after the fact will hit you with shocking bills.
3) Builders’ Allowances
Which takes us to our next topic, the bill. When you gave the builder a $300 allowance for a toilet, did you expect to fall in love with a $4000 gold toilet? Did you also expect the builder to charge a 20% margin on that toilet? It’s these kinds of changes that will leave you with a shock bill, like eating at an overpriced hot pot restaurant. Visiting the Home Show can be a valuable experience in costing up your reno or build.
4) Unrealistic Budgets
If you try to build a home on a sausage roll and one-dollar coffee budget, you’re going to go over budget. Your sausage roll shack only exists in your dreams and on paper. Sheer willpower will only get you so far, but proper budgeting should be the wake-up call. Most people miss the garden, fencing and rendering from their budget simply because it’s out of sight, therefore out of mind.
Going back to the hipster analogy, builders are not architects of avocado and eggs. They are going to put the cheapest or most functional materials into the home to keep the budget on track. Don’t compare ‘apples with apples’; know your materials. Go to the Home Show, browse hundreds of materials for looks, touch, price, pros and cons, sustainability, durability. Rinse and repeat.
6) The Unexpected
How could the builder possibly foresee Tutankhamen’s half-brother’s crypt was buried before they started digging out the basement? Even the professionals estimate 30 – 40 pieces of information will be missing from an airtight planning document. These can include electrical work and structural upgrades which can’t be assessed until the project is underway. Specialists like Ghostbusters can be called in to assess the property if it’s built on a graveyard.
7) Freak Accidents
Freak storms. Asbestos. Suppliers. Machine malfunctions. Tornados. Donald Trump. It’s the unexpected things that catch us off guard. But in some shape and form, they will happen. A contingency fund of 5% – 30% of the project budget will ensure any freak accidents won’t rock the boat.
8) Little Costs
From little things, big things grow! Clean-up costs, tip fees, stamp duty and insurance. A few dollars here and there may not seem like much, but it won’t take long before your card declines in Bunnings and you stand there shrugging your shoulders.
Get the budget right
You only get one shot, one opportunity, to do your budget. After that, you flick the cards and see where they lie. Anyone professional will always make sure their plans are detailed like a legally binding contract, leave nothing to interpretation.
Your builder should have a comprehensive wad of planning documents with clear instructions on them. Include inclusions specifications which itemise every fitting, finish, material and product you want in the final product. Software like ProSpex will streamline this tedious process.
The common thread here is communication. Get this right and not only will your builder love you, but you might even walk away within budget. (Good luck!)