Whether you’re undertaking a small home improvement project or a large renovation, one thing is for sure: You need a Budget. The big “b” word can scare people away as it can be difficult to know where to begin. While there is no hard and fast rule for how much you should spend on your renovation, there are ways to help you figure out the potential costs.

Structural vs Cosmetic

First things first is to determine the scale of your renovation project. Are your improvements structural or cosmetic?

“Structural Renovations are likely to be harder [than cosmetic renovations] to initially estimate costs as there could be unforeseen problems or difficulties that would need a detailed inspection by a professional tradesperson to assess,” says Tom Needham from property agency, National Property Buyers.

Cosmetic renovations are easier to estimate as the work involved can often be done by non-professionals, reducing the labour costs.

Whatever the ultimate cost is, you should “allow 30% overrun costs”, says Clover Financial Solutions. “Major structural renovations should have a signed fixed price building contract so that you know exactly how much is due and when, and also when you will need to leave your home and for how long.” If you need to be out of your home for some time, you’ll also need to factor in the temporary rental or hotel accommodation costs.

Budgeting specifics

When working out your budget, keep in mind that, generally, you won’t want to spend more than 5-10% of the total value of your home. Why? This helps to ensure that you don’t overcapitalise and spend more than you could one day make when you sell. Speaking of selling, the other thing you need to consider when you set your budget is how long you plan to be in this home for and what other renovations might be needed in the future. If you’re planning to sell, it’s better to make smaller, cosmetic updates as you want to maximise your profit when you sell. A new owner will also want to make their own changes and add their touch, so it’s best not to go overboard as a new owner could end up changing it!

The other thing to be mindful of is what similar homes in your area are doing, as these will be your potential purchasers’ benchmark when you look to sell. If all the similar homes in your neighbourhood have a kitchen island bench and luxurious taps, then this is an addition that you might want to strongly consider. On the other hand, if the homes in your area favour a more paired-back, no frills style, then you’ll want to give that swimming pool a miss.

Your personal circumstances

The number one thing you’ll want to keep in mind when setting a budget for any home improvement project is your own personal finances. There’s no point setting a $20,000 renovation budget if you can only afford $10,000. Stick within your means and look for ways that you can improve your home without breaking the bank, which will often mean performing cosmetic renovations as opposed to structural.

One activity that renovators are often told to avoid as it can be costly is moving the Plumbing. The reason why you might want to move your plumbing in the first place is if you’re looking to rearrange your bathroom or kitchen. For example, you might want to swap the location of your vanity and toilet, or add a kitchen sink to a different bench. Moving the existing plumbing can involve coring new holes and cutting into the concrete slab for new drainage pipes, which are both lengthy and expensive works. So, it’s understandable to want to avoid this! However, if you desperately want your new kitchen or bathroom layout (and why wouldn’t you!), Saniflo provide an innovative plumbing solution that means there’s no need to move your plumbing! Saniflo’s grey water and macerator pumps connect via slim pipes to your existing plumbing, so there’s no need to core new holes or cut through the concrete, and you can still achieve your new layout. Find out more here.

Clarissa is passionate about home decorating and often spends hours trawling Pinterest searching for the latest trends. She enjoys Scandinavian home style, is a dedicated organiser and tries really hard to keep her house plants alive.