Yahoo Finance 5 Crucial Steps to Setting Your Kitchen Remodeling Budget
Dreaming of a fresh, new kitchen but not sure where to start? In order to conduct a successful kitchen remodel project, you'll need to make sure you set a realistic budget. Sticking to a budget and managing the amount you spend on your kitchen remodel will help you avoid losing control of the project, keep you accountable for any unplanned costs and help you achieve the kitchen of your dreams.
Whether you are completely remodeling your kitchen or just adding new appliances, follow these five steps to help you set (and stick to) your kitchen remodeling budget.
[See: 12 Home Improvement Shortcuts That Are a Bad Idea.]
Do your research. As you try to set your budget for the project, it's important to have a realistic view of the typical cost of a kitchen remodel. According to Remodeling Magazine's 2016 Cost vs. Value Report, the national average cost for a mid-range major kitchen remodel this year is $59,999 and has an average return on value of 64.9 percent. Depending on the size of your home and your project, this average may vary.
If you're looking to remodel your kitchen for prospective homebuyers, keep in mind that your home's valuation depends on how it compares to similar properties in your neighborhood. You'll want any remodeling you do to help keep your home competitive with your neighbor's in terms of value.
If you're planning on living in your home long-term you'll want to complete a remodel that suits the style and comfort of your family, but if you're looking to sell within the next five years your kitchen remodel should be looked at as a real estate investment. A high-end home should have top-notch appliances, materials, countertops, flooring and be completed by a professional.
Determine your budget and stick to it. Choose an appropriate kitchen remodeling budget by setting clear expectations on what your remodel will include. Are you looking to add upscale, high-end renovations? Or are you planning on updating existing features in an affordable and family-friendly manner?
Set your wish list and cut costs where you can. A standard rule to follow is to keep your budget for a kitchen remodel between 5 and 15 percent of your home's value. For example, if your home is valued at $500,000, an appropriate kitchen renovation would cost between $25,000 and $75,000.
[See: Weird Home Features That May Confuse Homebuyers.]
Know the cost breakdown. Regardless of the size of your kitchen remodel, there will be different factors that take up varied portions of your budget. Components like labor, windows and cabinets will all play a role in your remodel. According to the National Kitchen and Bath Association, the costs for a kitchen project typically break down as the following:
-- Design fees: 4 percent
-- Installation: 17 percent
-- Appliances and ventilation: 14 percent
-- Cabinetry and hardware: 29 percent
-- Countertops: 10 percent
-- Lighting: 5 percent
-- Flooring: 7 percent
-- Doors and windows: 4 percent
-- Walls and ceilings: 5 percent
-- Faucets and plumbing: 4 percent
-- Other: 1 percent
Be prepared for unexpected costs. Unexpected costs are inevitable when it comes to any remodeling project. Set aside about 20 percent of the budget for these kinds of surprises. Unanticipated discoveries throughout the process of your remodel can come up at any time -- from water damage, bad electrical wiring and plumbing challenges that require additional workarounds and labor. You want to have a little extra room in your budget to cover any of these unforeseen costs without having to sacrifice plans for your end product.
[See: 8 Easy Renovation Projects Every Homeowner Can Do Now.]
Find the right professional. Hiring the right remodeling contractor for your project who will stay within your budget, communicate effectively and accommodate your requests will help you save money during your remodel. Provide your professional with a clear set of expectations prior to beginning any installation or renovations. Get a written estimate, understand all payments, and set a payment schedule. Be sure to put it in writing by drawing up a contract that outlines all details of the remodeling project from payments and proof of insurance to materials and dates.
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