Home renovations can be costly, time-consuming, and sometimes downright disastrous. However, it is a top trend in 2022 with the continued rise in home ownership and Work From Home (WFH) work style sparked as a result of the pandemic.
According to a 2022 US Houzz & Home Study report by Houzz Inc., Home renovations were more widespread in 2021, with 55% of homeowners reporting activity, compared with 53% in 2020, 54% in 2019, and 54% in 2018. Homeowners spent 20% more on renovations too. The median spending in 2021 was $18,000, compared with $15,000 the prior year, when the median spend already had risen by 15%.
Furthermore, higher-budget projects (representing the top 10% of spending) increased from $85,000 in 2020 to $100,000 or more in 2021.
Earthweb says 80% of houses in the United States in 2022 are at least 20 years old; therefore, they require home improvements and remodeling.
America’s inflation hit a forty-one-year high earlier this year, leaving little room for extra expenses. So if you’re planning on renovating your home this year, use these tips from industry experts. Be aware of these ten common mistakes people make if you’d like to avoid an unnecessarily hefty dollar payout.
1. Not sticking to a budget
According to National Remodeling Experts, it is vital to have a realistic idea of how much the project will cost from the outset and stick to that budget. Unexpected costs like hidden damage, permit fees, or unanticipated design changes can quickly add up and blow your budget. Be sure to factor in a buffer for unexpected costs, but stay true to your original plan as much as possible.
If you’re working with a professional contractor, they should be able to help you develop an accurate budget for your project. If you’re doing the work yourself, be sure to do your research and get a realistic estimate of what materials and labor will cost.
There are several ways to cut costs on your renovation without sacrificing quality or functionality. If you’re willing to get creative, you can find ways to save money without compromising your vision.
For example, consider shopping at salvage yards or online auction sites for fixtures and materials. You can also look for used furniture or appliances to repurpose for your project.
Another way to save money is to choose a more budget-friendly option for materials or finishes. For instance, you could opt for a less expensive material like laminate or tile instead of marble countertops.
2. Choosing the lowest cost every time
Using cheap materials during a home renovation project is tempting since costs have exploded.
The National Association of Home Builders reports building materials prices have increased 20.4% year-over-year and have risen 31.3% since January 2020 based on a Producer Price Index (PPI) report for residential construction inputs by the Bureau of Labor Statistics. Over the past five months, the index has climbed 10.6%, while the price index of services inputs to residential construction increased 3.8% in February, following a 5.1% increase in January 2021.
Choosing the cheapest option might save you money upfront but cost you more in the long run. Do your research and select materials that will last. Also, factor in the installation and labor cost when making your selections.
3. Not Asking for References
Architectural Digest says it’s important to ask for references if you’re planning your renovation. This way, you can be sure that the person or company you’re working with is reputable and has a good track record. Always make sure to get at least three references before deciding. In addition, GoBankingRates mentions references as one of the 12 important questions to ask before hiring a contractor.
4. Spending Too Much on Tech
If you’re planning to sell your home within the next few years, don’t go overboard with tech upgrades that will be outdated by the time buyers come knocking. Instead, stick to timeless features like hardwood floors or a new roof.
“Homeowners often want the latest and greatest technology, but they need to think about future buyers,” says Brad Hunter, chief economist for HomeAdvisor. “You don’t want to put in features that will be quickly out of date.”
For example, investing in a home automation system may not be the best use of your money if you’re planning to sell in the near future.
“Homebuyers are looking for low-maintenance homes, and many of these systems require ongoing maintenance,” Hunter says. “If you’re not planning to be in the home for a long time, you might want to hold off on installing them.”
Other tech upgrades that may not be worth the investment include in-wall speakers, programmable thermostats, and high-end appliances. Instead, focus on making smaller, more affordable improvements that appeal to a wide range of buyers.
5. Not Knowing Measurements
Always take measurements of your space before you start shopping for furniture or making any major purchases. Jocelyn Chiappone, interior designer and owner-principal of Digs Design Company, offers this tip: “Don’t fall in love with a 94-inch sofa when you can only fit an 84”.
6. Ignoring Building Codes and Working Without a Permit
Check with your local building department to find out the required permits for your project. Working without a license puts you at risk of being found and voids any insurance claims should something go wrong.
So, take the time to do things right and get the necessary permits before starting your project. It may take a bit longer and cost a little more upfront, but it could save you a lot of headache (and money) in the long run.
7. Installing New Appliances Last
Appliances are often one of the most expensive aspects of a renovation. By waiting to install them, you may find yourself over budget and scrambling to make up the difference.
According to Nationwide, a common mistake people make when renovating their homes is to install all new cabinets, kitchen countertops, and flooring and then realize they need all new appliances like refrigerators to match the design. It’s very costly, as buying all new appliances can add up quickly.
Instead, installing new kitchen appliances first and then working around them when renovating your home is the best approach. You can update your cabinets, countertops, and flooring later to match your new appliances.
In addition, appliances can often be challenging to install. If you wait until the end of your renovation, you may feel rushed and stressed out, which can lead to mistakes.
8. Not Consulting Professionals – Architects/Designers
Architects and designers can help you avoid making expensive mistakes, help you maximize your budget, and end up with a home that looks great and functions well. So don’t try to go it alone- consult the experts!
9. Underestimating Psychological Stressors
Physical and emotional stress can take a toll on our bodies, minds, and relationships. Therefore, it’s important to be aware of the potential for stress when embarking on a home renovation project and to take steps to avoid it.
Here are some tips from industry experts to help you avoid stress during your next home renovation:
- Plan ahead and be realistic about the timeline of your project. Rushing to finish a project can lead to subpar work and added stress.
- Communicate with your family or roommates about the potential for noise, dust, and disruptions. Having an open and honest dialogue will help everyone prepare for and adjust to the changes.
- Set a budget for your project and stick to it. Trying to save money by cutting corners can lead to stress and frustration down the road.
- Hire a qualified contractor whom you trust. A good contractor will be able to help you navigate the challenges of a home renovation project.
10. High-interest home improvement loans
Home improvement loans often have high interest rates, which can add up over time and cost you more in the long run.
To avoid this
- Shop around for the best rates and terms before taking out a loan. Compare offers from multiple lenders to see who can give you the best deal.
- It would be best to consider using a home equity line of credit instead of a home improvement loan. Adam McCann at WalletHub says that a home equity line of credit has a lower interest rate and allows you to borrow against the equity in your home.
- If you’re unsure which option is right for you, talk to a financial advisor or home renovation expert. They can help you understand the pros and cons of each option and make the best decision for your situation.
With some planning and careful consideration, you can avoid these expensive home renovation mistakes and save yourself time, money, and headaches in the long run.