It’s no doubt that kitchen renovations can be costly. Between cabinets, countertops, and kitchen appliances, not only are there supply costs, but installation and part costs that can take up a significant amount of a remodeling budget. For these reasons and more, homeowners wishing to undertake a kitchen renovation need to take the time to properly assess the budget that they will need.
Budgeting For Your Kitchen Remodel
Setting a budget before you begin your kitchen remodel is critical. An excellent strategy here is to determine the absolutely highest amount that you can spend, and then make your budget 75% of that amount. This means that the remaining 25% can be set aside as a contingency in the event of emergencies. Executing this type of strategy will ensure that not only will you not run out of money, but you will also potentially have money left over that you can put into décor or a separate home renovation project.
Homeowners will also want to consider whether the renovation is being done because they want to stay in their home for years to come, or if they are renovating because they are looking to add value to the home so that it can sell. A kitchen renovation can and should absolutely be viewed as a real estate investment, but when selling is the primary objective, homeowners need to consider what future homeowners would want more than what they might want for themselves.
• Identify how you are going to fund your kitchen renovation project. Are you going to pay cash? Are you going to tap into a home equity line of credit or take out a loan? Your funding situation will likely define much of your options in terms of budget and timing for the project.
• Within your defined budget, understand the distribution of funds to the various components involved in your renovation. For example, your labor costs will likely be 20% of your total. Cabinets and countertops will likely be an additional 35%, with 20% allocated to your appliances. The remaining 25% will be split across fixtures, windows, any fittings, and other needs.
• Determine your renovation priorities. For example, are you looking to replace your cabinets or simply repaint or refinish them? Are you looking to replace your countertops? A new quartz countertop can easily run anywhere from $2,000 to $4,000 or more with the average cost coming in around $50 - $70 per square foot. With a kitchen remodel averaging between $13,000 to $36,000, the countertop alone can be a significant investment.
• Decide if you are going to live in your home during the remodel, or if you are going to stay with family or friends, or in a hotel. Staying in a hotel for any extended period of time will add significant costs to your project budget. However, many homeowners prefer to live away from home during a kitchen remodel so that they are not subjected to the construction dust, and since the kitchen is often unusable during the renovation.
• Whether you live at home or stay in a hotel during the project, you will likely incur costs for eating out. Though there are a variety of options that you can consider to keep these costs down, sandwiches and cold foods will inevitably get tiring over time. Be sure to consider the costs of restaurant eating.
• Keep track of your budget throughout the process. A great way to do this is by developing a spreadsheet or some other documentation process that allows you to line list the expenses based on the project priority. Make note of all expenses as they are incurred and what they are for. Don’t allow too much time to pass by between updating the sheets either as you may find that you have spent more than you realize, which can easily push you into your contingency budget before you expected.
• Work with your contractor to identify what kitchen remodel project tasks that you can take on yourself. Labor costs can add up quickly, and even if it will take you longer to accomplish a certain step than it might be for your contractor, you might be able to save some significant expense. Even better, you will learn something along the way that might be helpful for future renovation projects that you choose to undertake.
The final consideration that you should factor is that once you have set a budget and your priorities, it is important not to deviate from the plan. Though you might come up with new ideas along the way or find other designs that are exciting and intriguing, this will not only add to the project cost, it may take away from the look that you initially desired. Understand that you can live without the extras, and will likely be far happier with a kitchen renovation project done at a high level of quality and within the budget that you initially set.
