Why Remodels Go Over Budget, and How to Keep Yours in Line
Find out how homeowner remodeling budgets fared in 2019, according to the 2020 Houzz & Home survey
Budgeting for a remodel can be challenging, and just 36% of remodeling homeowners hit their budgets in 2019, according to the 2020 U.S. Houzz & Home survey. But there are things homeowners can do to improve their chances of sticking to a budget. Read on to find out how often remodeling projects go over or come in under budget. And get pro tips on what to do to keep remodeling spending on track.
Another top reason that homeowners went over budget was that the project turned out to be more complex than expected. An example of this might be when your contractor opens a wall and finds that all the electrical wiring has to be replaced, which would add to the total project cost if you hadn’t been anticipating that.
A third reason came down to homeowner choice: deciding to buy more expensive products or materials than originally intended. Sometimes people decide that a beautiful kitchen backsplash tile or gorgeous range hood is worth the extra expense to get the look they want.
The Houzz & Home study is the largest publicly available survey of residential remodeling, building and decorating activity in the country. The 2020 survey, fielded Jan. 2 to March 5, collected information from more than 87,000 respondents. The report relies on findings from homeowners who renovated their primary home in 2019.
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A third reason came down to homeowner choice: deciding to buy more expensive products or materials than originally intended. Sometimes people decide that a beautiful kitchen backsplash tile or gorgeous range hood is worth the extra expense to get the look they want.
The Houzz & Home study is the largest publicly available survey of residential remodeling, building and decorating activity in the country. The 2020 survey, fielded Jan. 2 to March 5, collected information from more than 87,000 respondents. The report relies on findings from homeowners who renovated their primary home in 2019.
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3 Tips From Pros for Staying on Budget
Homeowners can take steps to help keep their projects as close to budget as possible. Here are three strategies suggested by experienced pros:
Plan a buffer in the budget. With remodeling, you can plan for the unexpected. Your budget should reflect that.
“Buffer in an additional 25% of your costs on a remodel, if not more,” advises designer Andrea Schumacher of Andrea Schumacher Interiors in Denver. “Eighty percent of the time you are going to open up [the walls] and run into something you didn’t know you had to contend with. Or you’ll open up your floors and realize that the subfloor was damaged and has to be redone.”
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Homeowners can take steps to help keep their projects as close to budget as possible. Here are three strategies suggested by experienced pros:
Plan a buffer in the budget. With remodeling, you can plan for the unexpected. Your budget should reflect that.
“Buffer in an additional 25% of your costs on a remodel, if not more,” advises designer Andrea Schumacher of Andrea Schumacher Interiors in Denver. “Eighty percent of the time you are going to open up [the walls] and run into something you didn’t know you had to contend with. Or you’ll open up your floors and realize that the subfloor was damaged and has to be redone.”
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Focus on your priorities. When it comes to remodeling, the possibilities for improving your home can feel almost unlimited — other than by cost. Most people have budgetary limits, but even if you don’t, it’s important to think about your goals for the remodel.
“Even if you have an unlimited budget, there’s so much that you can do that you need to prioritize,” Debbie Travin of DLT Interiors in Miami says. At the end of the project, you want to feel satisfied that you put your money where it counted most.
While priorities will vary from person to person, Travin often recommends that people interested in a whole-house remodel put money into common spaces such as the living area and kitchen (or combined great room), as well as the master bedroom and master bathroom. “You can do less on guest rooms and kids’ rooms and even dining rooms,” she suggests.
“Even if you have an unlimited budget, there’s so much that you can do that you need to prioritize,” Debbie Travin of DLT Interiors in Miami says. At the end of the project, you want to feel satisfied that you put your money where it counted most.
While priorities will vary from person to person, Travin often recommends that people interested in a whole-house remodel put money into common spaces such as the living area and kitchen (or combined great room), as well as the master bedroom and master bathroom. “You can do less on guest rooms and kids’ rooms and even dining rooms,” she suggests.
Trust the pro you hire. Unless you have deep construction expertise and knowledge of products yourself, it’s a good idea to lean on your pro to most effectively achieve cost savings. “Experienced professionals know how to get that designer look and the most bang for your buck, and get that cost savings in at the same time,” says Deana Duffek of design-build firm Duffek Design & Development in Laguna Beach, California.
It can be tempting, though, to try to do the legwork yourself. Duffek cited an example of clients who recently found a kitchen faucet cheaper online than the four she had recommended. But what the clients didn’t realize was that the model they found “comes with no parts needed to install it,” Duffek says. “You’d need another $200 to get the valves to put that faucet in the wall,” which would eliminate the savings. On top of that, Duffek didn’t know an installer familiar with this product, meaning that finding someone to put it in would be a challenge since tradespeople generally want to install products they feel confident enough about that they can warranty their work.
Bottom line: When looking for cost savings, it’s a good idea to trust the pro you’ve hired to manage your project. “We’d get you all the parts you need at the very best price,” Duffek says. “Trust that we know the best brands to work with, the best savings to get you. That’s one of the advantages of working with a professional.”
Once work begins, a pro can let you know how changes you want to make to the plan would affect your budget. Some pros even use project management software, such as Houzz Pro, to share information and allow clients to approve or reject any changes.
More on Houzz
Read stories about remodeling
Browse and save photos to inspire your own remodel
Shop for products
It can be tempting, though, to try to do the legwork yourself. Duffek cited an example of clients who recently found a kitchen faucet cheaper online than the four she had recommended. But what the clients didn’t realize was that the model they found “comes with no parts needed to install it,” Duffek says. “You’d need another $200 to get the valves to put that faucet in the wall,” which would eliminate the savings. On top of that, Duffek didn’t know an installer familiar with this product, meaning that finding someone to put it in would be a challenge since tradespeople generally want to install products they feel confident enough about that they can warranty their work.
Bottom line: When looking for cost savings, it’s a good idea to trust the pro you’ve hired to manage your project. “We’d get you all the parts you need at the very best price,” Duffek says. “Trust that we know the best brands to work with, the best savings to get you. That’s one of the advantages of working with a professional.”
Once work begins, a pro can let you know how changes you want to make to the plan would affect your budget. Some pros even use project management software, such as Houzz Pro, to share information and allow clients to approve or reject any changes.
More on Houzz
Read stories about remodeling
Browse and save photos to inspire your own remodel
Shop for products
In 2019, 31% of homeowners who remodeled their homes ended their projects over budget, according to the 2020 U.S. Houzz & Home study. Some 36% completed remodeling projects right on budget. Just 3% came in with their projects under budget. And 29% had no initial budget for their projects at all.
Homeowners who exceeded their budgets did so for a variety of reasons. One of the top causes homeowners cited was finding that products and services cost more than they had expected. (Note: It’s wise to take the low budgets — and short timelines — presented in home remodeling shows with a big grain of salt.)