How much should you budget for your home remodeling project?
- Setting a realistic home remodeling budget is very important. There are several rules of thumb that can be very helpful. The most common method is to decide how much you should invest based on the percentage of your home value. This is the best way to maximize your return on the investment. Spending a disproportionately higher amount on a home renovation can result in your leaving money on the table in the event of a resale. On the other hand, spending a lower amount can make your home less attractive for buyers in your price range.
- Some guidelines based on national surveys are as follows:
- Kitchens: 6-12% of home value
- Bathrooms: 5-10% of home value
- Basements: 3-6% of home value
- Needless to say, there are many factors that will impact the level of investment including; the relocation of fixtures, structural changes to the floor plan, the quality of the materials selected, the quality of the finishes to the room, etc.
- For example, if your home is valued at $500,000, you should be prepared to spend from $25,000 to $50,000 to fully remodel your master bathroom. You should plan to invest 25 to 40% less for guest bathrooms.
- It is also important to identify pre-existing conditions such as plumbing or electrical issues that might need to be addressed prior to or during the home remodeling project. These issues can increase the investment required, but it’s best to identify them up front in order to avoid surprises.
- The absolute best way to start your renovation is to have a design consultation that provides the documentation you’ll need to finalize your home remodeling budget.
For more information please visit Home Remodeling Projects Costs in 2016.