Before remodeling your
house it is important to determine the value of your
house. This will allow you to decide how much you
should spend on remodeling your house. You will be
able to estimate the percentage of renovation cost.
This estimate will tell you whether remodeling is
worthwhile or it is better to buy a new house. If the
cost of remodeling is about 20-30% of you house value
then it is acceptable. If the cost of remodeling is
above 30% then it is better to buy a new house than
remodel it.
Home value is estimated depending on the type of
house, location of the house, sale price of houses in your
locality and projected growth for the community. The best estimate
of the value of your house is sale value of a similar house in
your locality. Another method of calculating the value of your
house is to have it valued by a professional. You may require the
assistance of a professional appraiser, especially if you are
applying for finance to renovate your house.
The remodeling cost of your house will depend primarily on the
type of renovations that you are making. If you plan to make
internal changes in the house it will not cost a lot. But if you
plan to make structural changes it will be more expensive. Changes
in the physical structure of the house will mean roof extension,
exterior siding, insulation, wiring, plumbing and decorating the
room. The cost of remodeling your house will include the cost of
construction materials, cost of construction labor, permit fees,
decorating the remodeled part, cost of repairs due to remodeling
and cleaning up after remodeling. The contractors must quote costs
for the above when they submit their bids.
Review all the bids carefully before selecting a
contractor. It will be easier for the contractor to give an
accurate figure when you give him a project specification plan.
The contractor should include the following costs:
Labor cost should include total hours
required, payroll taxes and workers' compensation insurance.
Construction equipment.
Safety equipment like hard hats, dust masks,
gloves and goggles.
Materials including wooden frames, plumbing
fixtures, flooring, cabinets, paint, insulation, tile, heating
and ventilation units.
Repairs as required while tearing into the
existing construction.
Cleanup including rental bins, removal
service and dumping fees.
Light fixtures, window coverings etc.
Fees of subcontractors like electrician,
plumber etc.
Including estimated costs of upgrades and
changes.
The cost of all the above should not exceed
20-30% of your home value, for the remodeling project to be a
worthwhile investment.
