A renovation always seems to cost more than you expect. Even with careful planning, hidden issues, rising material prices and unexpected delays can eat into your budget.
Without a clear and realistic plan, costs can spiral, leaving you with unfinished work and a dwindling bank balance. Consider our tips below to help stay on top of your project finances.
Assess the scope of your project
Before looking at numbers, take some time to identify exactly what needs to be done. Walk through the property and list every job, from essential structural changes to cosmetic upgrades.
If you’re opening up walls or adding extensions, consider whether you’ll need planning permission or input from a structural specialist.
Divide your renovation into phases if necessary. This approach spreads costs over time, making the project and funding more manageable. Be realistic about timeframes, too. Rushed work can lead to expensive mistakes.
Research average renovation costs in the UK
Prices vary depending on location, property type and the complexity of the work. Knowing ballpark market costs should prevent any excessively unrealistic budgeting.
Kitchen renovations, for example, can cost anywhere from £5,000 for a simple update to over £30,000 for a larger, high-end redesign. Bathroom renovations tend to be cheaper, but can easily reach five figures if you have a larger room and opt for luxury finishes.
Labour is usually the biggest expense, with builders charging by the day. Plumbers and electricians often charge more due to the specialist nature of their work.
Check current labour and material rates with local contractors and trade suppliers to get a clearer picture of what to expect.
Explore your financing options
If you don’t have enough cash saved, you’ll need to consider financing methods as part of your budgeting.
A remortgage might offer lower interest rates than a personal loan, especially if you’ve got equity in your home. A home improvement loan can be quicker to secure but often comes with higher repayment costs.
If your renovation adds value to the property, a bridging loan could be an option, particularly if you’re selling after the work is complete.
For smaller projects, a credit card for bad credit could be a cost-effective way to spread expenses and build your reputation as a borrower. Although, you should always clear the balance as soon as you can to avoid incurring too much interest.
Whichever route you take, factor repayments into your budget to avoid financial strain.
Identify what you can and can’t do yourself
DIY can save thousands over a renovation, but only if done correctly. Painting, stripping wallpaper and simple tiling are some tasks most people can manage with the right tools and a little patience.
Anything involving electrics, plumbing or structural work should always be left to professionals. A poorly fitted boiler or incorrectly wired socket can be extremely dangerous.
If you’re tackling demolition yourself, ensure you know what’s behind walls before you start swinging a sledgehammer. Even the smallest mistakes can lead to costly repairs and project delays.
Overestimate rather than underestimate
Unexpected costs will arise – they always do. Whether it’s hidden damp, outdated wiring or material price hikes, a renovation budget should always include a contingency.
Add at least 15% on top of your estimated costs to cover unforeseen expenses. If you’re working with an older property, you may want to increase this to 20%. Good luck!
