Creating a realistic renovation budget rests on how accurately you estimate your costs. Here are six tips to help you work out your renovation costs-before you get the hammers and hacksaws out.

1. Decide on the scope of your renovation

It’s quite remarkable, as humans we are often very keen to renovate a property.

The scope and size of your renovation has a huge impact on the cost. Start with a list of must-haves and nice-to-haves, because at some point during planning you’ll need to review the scope of your project. You'll need to prioritise.

2. Use a budget calculator for a rough guide

There are some helpful renovation and building calculators out there. They'll give you a rough estimate of costs and help you plan. Building and renovating businesses often have calculators on their websites to use as a guide before you start getting quotes.

If you’ve never done a renovation or build before, the cost may come as a bit of a shock. Because the whole point of this exercise is to be realistic about what you can afford.

If you think you’re about to blow your budget, you should review the scope of your project now.

3. Break down costs with a detailed cost guide

You may have had some designs or plans drawn up by now. If you do this, you’ll have a much better idea of the work involved.

Want advice around the cost of building and renovating? Speak to architects, quantity surveyors and the consumer affairs or fair trading department in your state or territory.

4. Get professionals to check your plans

If you haven’t already got plans for your renovation or extension, get them done before you finalise your budget. They’re crucial if you want to nail down your project’s costs.

The build costs will depend on things like:

  • The materials you want to use
  • The tradespeople you employ
  • The quality of work, finishes and fittings
  • The size of the job
  • The location of your site.

5. Get three quotes from your tradespeople

You’ve probably heard it a hundred times, but get at least three quotes from builders or tradespeople. You'll be surprised how much these quotes vary.

Looking in your local paper, asking friends or family—putting the word out—can be good ways to find good tradespersons. You could also try using an online quote service like Home Improvement Pages.

6. Add 10 - 20% to your final budget as a contingency

This is what you call a back-up plan or 'contingency'.

Overspends are very common on building projects. Renovation experts recommend you factor in an additional 10% of your project costs into your renovation budget.

Finally, you can never do too much research. A great resource to start with is Your Home, a government website about building, buying and renovating a home. And, here are some consumer affairs or fair trading departments that offer helpful consumer protection advice about building and renovating.

Renovation inspiration with NAB

Important information

The information contained in this article is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, NAB recommends that you consider whether it is appropriate for your circumstances. NAB recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.

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