Now, on the cost side, meaning money of renovations, there are a few financial things to consider when looking at the budget of your project:
Living expenses during the renovation
These include, but are not limited to; food, accomodation, travel, etc. It may be the kitchen that’s being renovated. BBQing can get tiring (BITE YOUR TONGUE!!). Washing dishes in the laundry tub or bath tub is difficult. Eating out or delivery can get expensive. Consider three meals per day. Add that potential cost to the renovation budget. Where are you going to live while the work is being done? You may think that you can live in the house during the work – even the smallest of renovations. Not so.
Here’s a free tip; Work goes more smooth and less stressful for your contractor if the odd ‘F’ bomb can be dropped without worrying about small ears. Hovering clients make work go slower and “on the fly” changes or repairs seem like mistakes in the eyes of a looming client. We appreciate your interest, but you’re not allowed under your car while it’s on the mechanic’s hoist. Besides, the dust will drive you crazy! Consider renting a space for a limited time. Look at “house sitting” for a friend or family member while they’re away spending their tax return on a vacation instead of calling me to renovate their kitchen…….
Consider that accommodation cost, or your own holiday as part of the cost. Travel is another cost to consider. If you do move out of the house, maybe you’re bus ride hits another zone or the taxi is a longer ride. It does add up.
Before and during the renovation. Unless you’re renovation before moving in, your stuff has to go somewhere. There are several “on site” storage bins / boxes that are available (“Stork-it”, “P.O.D.S” etc) and they can even take your stuff away to a their storage area for safe keeping until the work is done and then bring it back when the work is done. Along with the actual storage of the stuff, there may be a cost for movers – professionals to hoist Grandma’s baby grand piano into the truck. Don’t forget to check with your insurance carrier too. Make sure that you’re protected for stuff that’s off site or even on your lawn. Some carrier’s allow a grace period for between residences for in the case of moving from one to the other – in transit. I could rant about what get’s stored and what gets taken to a relatives house, but that’s another blog. Essentially, pictures and irreplaceable stuff DOES NOT go to ANY storage facility. I don’t care who they are. Also, since I’m starting that part of the rant, check the mover’s and storage facility’s insurance and policy for lost / damaged property. None of that “at your own risk” stuff is acceptable.
The actual COST of the renovation
It’s been beat into our heads to “prepare for a cost overrun of 10-15% for the renovation”. That’s a very old wives tale. I have a 5% contingency worked into my budgets, and that’s just for the little things that come up that aren’t life (project) threatening. That leaves 5-10% for rot, mold, structural, design changes, fixture upgrades, additional charges for “well, since you’re here” extras, and even the extra charges for another inspection fee because the inspector showed up early and no one was there to let him in and he called for a re-inspection…… (no, it’s not a personal reflection).
A more realistic percentage is 20-25%. That’s a staggering number and a hard pill to swallow, but imagine the surprise on the face of one of my clients who gets a cheque from me at the end of the job because we came in UNDER budget!! Along with the contingency and cost overrun, consider the “carrying charges” of a renovation loan, loan from a family member or friend, even the interest that you’ll have to pay if you don’t get the RRSP money back into the account. What about interest on an overdraft or line of credit? Nowadays, people moving from one house to another, and renovation the new house, will carry two mortgages for a month or so while the work is being done. Double mortgage . Maybe there’s a fee, fine, some administration jumble for doing that. Maybe the insurance company will require a separate or additional insurance policy for the new home. Ask about a “renovation insurance policy” that protects the house in case of a fire or tragic event during the renovation (More on Contractor’s Insurance next time).
So, it’s quite a bit to consider when thinking about renovating – Financial risk, the design decisions, the lost sleep over the whole event, etc. It’s not all horrible though. The end usually does make up for the means. I explained it like this to one lady client (without any first hand knowledge, of course);
Renovations are like child birth; yeah, it hurts like hell and you wonder why it sounded like a good idea at the beginning (and maybe it was the wine talking), and seemed exciting as it began, but now you just wish it were all over and wiped clean from your memory.
The truth is, when it’s all done and you’re sitting in your chair, admiring the fruits of (someone else’s) labour, the pain is forgotten and the joy is abundant. Be warned though, it still is like babies and diapers too; Once the diapers stop and that’s been forgotten, you’ll want to do it all over again!!! We call it the “Reno Bug”.