Newspaper article The Chronicle (Toowoomba, Australia)

How to Nail Your Renovation Budget

Newspaper article The Chronicle (Toowoomba, Australia)

How to Nail Your Renovation Budget

Article excerpt

DO spreadsheets and budgets make your eyes glaze over?

A renovation budget doesn't have to be boring - think of it as a gateway to the great new place you're creating.

Here are some steps and tips from NAB for creating and maintaining an accurate renovation budget.

Estimate costs

At the outset, a budget helps answer the renovate or relocate question. At this stage, you might just be doing your own research to see if you can afford a renovation.

Try these tools to get a good initial estimate of your planned renovation (for both, you'll need to register):

Archicentre Cost Guide

Property Value Renovation Calculator

These tools will give you a rough idea of how much a renovation will cost, and may give you the confidence to take the next step.

As well as the cost of doing the renovation itself, think about your property's value and the risk of overcapitalising.

Is your planned renovation too much compared with the average size and value of homes in your area?

Understanding your home's value can also inform the way you structure your renovation budget.

For example, a kitchen renovation may cost from $5000 to $50,000 (or more) depending on the appliances and finishes you choose.

Experts in this article about home improvements recommend five per cent of the value of your home should be in your kitchen.

So if your home is worth $500,000, you could consider spending up to $25,000 on your kitchen.

Get costs from the professionals

You'll need to enlist the professionals to get a more accurate picture of your costs before committing one way or another.

Here are some of the people you should talk to.

Building inspectors

Particularly for major renovations, they can perform a comprehensive inspection (unless you've done one recently) to reveal whether any significant structural work needs doing, like rewiring or re-stumping.

If required, factor these repair costs into your budget.

Architects

Ask for drawings of your renovation plans and get more than one quote.

Ask about the architect's fees and cost structures upfront.

It's quite common for architects to charge a percentage fee based on the overall cost of the project. …

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