Does your home look and feel like it needs some revamp soon? Home renovation projects are an exciting undertaking. But as you might already know, these jobs aren’t cheap. This is why it is important to budget accordingly to ensure that you don’t end up wasting more than what you can afford.
How much should you budget for renovations, then?
How Much Does It Cost to Renovate Your Home?
Depending on where you live, your level of experience and skills, and the specific room you plan to renovate, home renovation projects approximately cost $10 to $60 per square foot. Some projects may even cost as much as $150 per square foot. What does it mean for you?
It means that if you are living in a cozy house with 1,000 square feet, renovating it might cost you anywhere around $10,000 to $60,000. A 2,000-square-foot house, on the other hand, can cost you $20,000 to $120,000. With such staggering figures, it always makes sense to plan.
Take note that there are several factors that several factors affect the cost of home renovations. These include the size of the room in question, the type of work required, how big the project is, and the cost of materials. If you wish to have your basement transformed into a gaming room, or you want to have a Jacuzzi installed on your rooftop, the project’s cost might be significantly higher than usual.
If you plan to renovate your basement, bathroom, and kitchen, it might cost you $30,000 to $81,000. However, if your priority is your bathroom, you might stick with this project first and delay the rest.
The easiest way to come up with a budget for the home renovation is to specify all renovation projects you like and price them accordingly. Request for bids for every project and rank them based on priority. Create a detailed project for the particular project you like to do first.
How Much Should You Spend on Renovations?
The general rule of thumb here is to avoid crazy spending half your home’s price to renovate one or two rooms. This won’t likely add a balanced value to your home. The easiest way to determine how much you should budget for your home renovation is to consider your current budget every month and take things from there.
For example, your house is worth $250,000 and you have a household income of $80,000. Ideally, you should spend $60,000 on renovations to upgrade some rooms and do the necessary repairs and fixes. If you save up to $2,500 every month for the renovations, you will be able to finish half of the project in your first year of saving.
How Should You Pay for Home Renovations?
Cash is your only option if you wish to be smart with your renovation projects and the expenses involved. While there are fancy options for financing that often mean you will be getting into debt, it’s not always a wise choice. Home renovations aren’t even worth borrowing on your home equity just to pay it back with interest on top.