Build Your Renovation Budget

Define the physical work

The entered renovation work budget can include contractor labor, materials, demolition, debris removal, kitchens, bathrooms, finishes, ordinary exterior work and building-system repairs. Contractor overhead in the written work budget and permits directly related to the work may be included.

Give other costs their own lines

Keep contingency, acquisition costs, loan fees, interest, taxes, insurance, utilities, reserves, selling costs and overruns separate. A contingency is money planned for surprises. It is not the same as an expected profit. Entering an expense in the work budget does not establish that a lender will reimburse it.

Explain work that needs closer review

Foundation work, structural changes, additions, changes in use or unit count, major casualty repairs and unclear renovation-versus-construction scope require direct review. Budget size alone does not decide complexity. Ben can review the scope and financing requirements with you.

Your quick checklist

• Use a written scope that matches the entered work budget.
• Keep contingency separate.
• Check whether contractor overhead and work permits are already included.
• Identify work already underway and unresolved cost estimates.