If you’re like most homeowners, you’ve held on to your house for longer than you had expected due to the recent housing market decline. You might have originally planned to sell your home a few years ago, but were unable to stomach the unprecedented price decrease, and are now in the position of having to remodel a room or two in your existing home instead of moving into a newer place. Economic difficulties have hit harder than expected, however, because the inflation associated with the current recession means that if you did retain your job and salary, you still suffered a significant reduction in your real buying power. So if you’re beginning a remodelling project, you need to be extremely budget conscious.
Most home remodelling projects run out of money before homeowners are able to complete all of the important details that make the project successful. Most home remodelling projects end up exceeding their planned budget by as much 25% to 33%, which causes additional financial hardship for homeowners. To avoid such cost overruns, you should determine your maximum budget in advance, then multiply that number by 3/4. This will leave you the remaining 1/4 as a pad for unforeseen circumstances.
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