Picking up a home renovation project is not a bad way to spend this pandemic. But before you start tearing at your house, take note of the tips below to make sure you are not ripping a hole into your bank account, too.
1. Set your budget.
The last thing you want is to run out of budget in the middle of your project. Be very careful about how you manage your money. Even small increases can add up really fast. It is best to project your expenses with a 20% margin before starting to avoid running into problems.
2. Finance your project correctly.
Explore your funding options. You can use your home equity line of credit, a personal loan, cash-out refinance, or credit cards. The most important thing is that these projects are not being funded to the detriment of more important expenses.
3. Consider return on investment.
How long do you see yourself living in your home? If you are thinking about selling it soon, you may want to focus on projects that have a good return of investment. Many renovations can be expensive, but surprisingly add no value to your home. Call a local real estate agent to ask for advice on which home renovations translate to an increase in home value.
4. Consider several contractors.
If you decide to hire professionals, get estimates from several contractors and research them well. Look at their credentials and references to ensure you are picking the right one. A good contractor will guarantee the work and offer a warranty. Also, always get your agreement in writing to avoid nasty surprises.
5. Do not cut corners.
Some projects are expensive right at the get go. It is understandable that you would want to save money. However, do not automatically cut corners by using the cheapest materials. Consider the trade off between quality and the price for your project. Ideally, you will find the best quality products that will nicely fit your budget. Otherwise, you may be setting yourself up for costly repairs in a few months because you did your home renovation project poorly.