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How to budget for a home renovation project? We asked the expert

By June 17, 2021Budgeting, Home

Working out how to budget for a home renovation, extension or building project is challenging at the best of times, but the circumstances over the last 12 months have made it especially challenging. To get some expert advice about current building costs and tips for staying on budget, I chatted with Quantity Surveyor Patricia Power.

The current position

“I do not see a crash or any reduction in prices over the next 12 months; if anything, prices will continue to creep up,” says Power. There has been a 5-6% increase in construction costs since this time last year. There are a number of reasons for this. New building regulations aimed at improving homes’ energy ratings have driven up prices. An increase in demand for contractors and other trades has also contributed to prices going up. Global lockdowns have impacted the supply of materials, causing longer lead times and scarcity in the marketplace. As a result, there have been increases in prices for items like timber and insulation. 

Another factor that may cause costs to rise even further is the impact of Brexit. This hasn’t been felt within the construction industry yet. Before the sites reopened earlier this month, there was only one working week since Brexit. So we’ve yet to see what the implications to the construction will be, but time will tell. 

New build and extension costs

“The previous rate of €2000 per sq meter for new builds simply isn’t achievable anymore,” says Power. She cites an example of a recently costed project for an elderly couple downsizing to a new-build home. ‘They are going for a contemporary finish throughout the house. They are putting in a heat pump and PVA panels to reduce their running costs. Their project is coming in at €2,750 per square meter inc. VAT.”

“This figure allows for any items that the contractor needs to be involved in,” she explains. The figure includes the cost of the kitchen and utility units, sanitaryware, wall and floor tiling, other floor finishes, skirtings, stairs, painting and decorating, wiring for CCTV and alarm, as well as driveway and patio finishes. Items outside the price would be any decorative finishes like wall panelling, wardrobes or bespoke joinery items. Final fit for alarm and CCTV, curtains, blinds and loose furniture. 

When working out how to budget for a home renovation, it’s important to note that every house renovation or extension will differ. Different layouts, site conditions, standards and specifications will all have a bearing on the cost. “New build costs can be as high as €5,000-5,500k for an architecturally designed bespoke home,” says Power. 

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Renovation costs

Renovation costs are more difficult to estimate as they vary a lot depending on the condition of the house and the extent of the work being done. Patricia recommends a figure of between €1500 – €2000 per square metre. This would cover a complete refurbishment, including insulating, airtightness, replacing windows, rewiring and replumbing. 

When you are extending and refurbishing a home you should always prioritize bringing the existing house up to a good standard of finish, then allocate what’s left in your budget to the extension. “There is no point in building a brand new extension and your existing house being cold and dated. You won’t enjoy it,” says Power.

How to budget for a home renovation

Demolition costs

Any changes to the layout of your home that require demolition will add to the overall cost. “People often underestimate the cost of demolition,” says Power. But demolition is expensive. One way to make savings to the build cost is to retain as much of the existing layout as you can. Limit any alterations that require demolition and keep window and door openings where they are. 

There will be cases where demolition is necessary or where removing items will significantly improve the layout of your home. It’s always best to get advice about the most cost-effective way to do these things. For example, removing a chimney can free up space in a room and believe it or not, the cost to take it down completely is approximately the same as taking it out at ground floor only. If you are planning any structural work like this, you should consult a structural engineer. 

How to keep costs in check

When you plan any building project, you need to be comfortable that you can afford it. This means knowing as early as possible what the work you are planning will cost. It’s a good idea to engage with a QS as early in the process as possible. Power recommends talking to a QS at sketch stage before you go for planning. A QS will bring practicality and reality at a very early stage of a project,” says Power.

When working out how to budget for a home renovation you might not be considering lots of practicalities at an early stage but they are critical to you being able to move back into your home. The QS will ask questions about finishes and specifications and factor them into your budget. You might not like to hear that you’re over budget early on, “but the earlier you hear it the more time you have to adapt and get used to it, and figure out ways to make it work,” says Power.

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home renovation
Denise O'Connor

Author Denise O'Connor

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