Why Does My Renovation Cost So Much?

Why Does My Renovation Cost So Much?

If I had a dollar for every time I’ve heard someone exclaim that…well I guess I could finally go on a holiday.

It’s no surprise that cost is one of the main factors in going forward with renovations. After all, as an ancient proverb states,”foolish is the man who does not calculate the cost, to know whether he will have enough to finish it”. It is all to common however, that many will request a quote for renovations to their home, without doing the relevant research. Many have a budget amount in mind, but without doing the research for the type of work, location, council requirements, etc., it often is far from a reasonable budget.

If you have never engaged someone to do renovations or extensions to your home, it can be very difficult to understand the subsequent costs associated with the work. And with construction reality television so prevalent these days, false cost expectations abound. The numbers thrown about on television shows, often do not include supply costs, overheads or contractors margins as advertising revenue covers a lot of this behind the scenes.

So how much should a renovation cost?

Obviously this depends greatly on the renovation area of your home, and the fixtures, inclusions and finishes of the work. However some general prices can be estimated based on previous jobs of the same kind.

Doing a quick online search can often help you to figure out what a standard per square meter cost can apply to your intended project. Click here for a construction cost calculator, which you can use to check you have enough budget to build or renovate what you want.

Keep in mind that renovations can cost 60-150% more per square metre, based on the fact that working with unknown existing conditions often lead to variations and extras.

Whether you are building new or renovating, some things just cant be avoided, such as labour costs, contractors margins, home warranty insurance, Certification and council fees, and of course unforeseen occurrence. All of these things can increase your total costs considerably. This means that having a budget is paramount, but your budget should NOT be the maximum amount you have at disposal. I, as well as many builders and owners, have had the experience of signing a contract based on a budget that was just way too tight. When problems arise and there is no room to move, well, it usually ends in tears.

Our recommendation!

Engage a builder, right from the start. Getting a full set of plans, engineering, council approvals, and then getting builders to compete on price to win your contract may haveworked in the past, but with ever higher costs of materials and labour, the chances of coming under budget on plans that have been compiled without a builders input are slim to none.

After spending thousands of dollars on plans and approvals, to find out you can’t afford it can be heartbreaking. The last thing you want at the last hurdle to construction.

Also, choosing a builder based on their construction costs, does not guarantee a smooth and enjoyable experience, during your construction. A more effective way is to call up builders in your area and ask to meet them, like a job interview. Ask them to provide previous work experience, a portfolio, perhaps even a set of references from former clients. Once you trust the builder, tell them your budget. I know this sounds like a big no-no, but it is imperative for a builder to help you establish a design and scope of work that fits within your budget.

Should you want an architect to design your plans, that’s fine but be sure to include your chosen builder in on the design process. Your builder will know the various costs to build the dreams that you have, whereas architects, despite their best efforts can sometimes be out of touch with current market trends.

The bottom line!

Building or renovating can be an expensive exercise, but engaging a builder early can help you to plan your construction to fit your budget, instead of stretching your budget to fit your dreams.