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Budgeting And Cost Control

By: Chris Hogan MSc - Updated: 6 Oct 2020 | comments*Discuss
 
Budget Invoice Quote Estimate Property

An essential part of any building or renovation job is setting the budget in the first place and then controlling the costs as the project progresses, hopefully smoothly. This needs effort; you would be misguided if you thought it was something that you could knock off in a couple of minutes a day.

Background Work

The first step to arriving at a decent budget is to properly explore the current condition of the property and get a professional structural survey if you are planning major works. This will cost, of course, but it will mean that you know exactly what’s facing you. Make sure you have every job covered, enlisting an architect or project manager to make sure you don’t overlook anything if you don’t have much experience with renovation.

Estimation

You can then estimate the cost using calculations that professionals use, which you can find in books about building and renovation. These will take in details about the project then give out a cost per square metre or foot for the work. This isn’t perfect, of course, but the costings are based on years of experience so shouldn’t be too far out. You can get an architect to do this for you if you prefer.

Use Your Time Wisely

Armed with this general idea you can then get quotes from people to do the work, unless you’re tackling it yourself. If you do intend to do a lot of the work yourself, consider carefully where your money might be best spent.

Take clearing the site and ripping out internal items that are either damaged or going to be replaced as an example. This is work that almost anyone can do, but will it be better to employ a cheap labourer to do it while you earn more money at your day job?

What if You’re Not Working?

If you’re doing the renovation full-time, it’s still a valid question; would the project be finished in a quicker time (and therefore cost less) if you spend your time on other jobs while someone else does that work? While you are planning your budget and writing it all down, ask yourself this question about every task that needs to be done.

Of course, there are some jobs that you should not do, unless you have the experience, such as structural work. And there are others that you are not allowed to do unless you are qualified, such as major electrical and gas work.

Getting Quotes

For the jobs that will be done by others, get at least three quotes from reputable tradesmen, preferably some that have been recommended to you personally. You can use the quotes to play them off against each other if you feel confident in your bargaining skills. The same goes for materials too, if you’re getting them in yourself, ring round for different quotes.

Keeping Tabs on Costs

As soon as the project is under way, keeping tabs on the ongoing costs is crucial. Keep in touch with your tradesmen and remember, if you change your mind about things as you go along (which is quite normal) it will cost you more than the quote (again, normal and reasonable).

The trick is to be up front and ask what the extra costs are going to be. If you don’t, when the bill comes in and it’s 20% over the estimate, because of changes you asked for but didn’t get quotes on, you’ll be on the back foot.

When it comes to those bills, make sure you know at what stage you will be billed by each person and what they’ll be billing for. You need to make sure that the money will be available for them. If you underpay good workers, they won’t stay with you, and if you overpay them then there’s a risk that they’ll move on to another job with your money in their pocket. You need to balance this careful, pay in stages but always slightly behind the work that’s being done.

Check and Check Again

Finally, make sure you check the bills coming in against the quotes you were given. I know this sounds obvious, but on a big project, you’ll soon forget who said what would cost how much. Keep good records, always getting your quotes in writing and check them off one by one to make sure you’re getting the right deals.

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I own a house that is over 100 years old in England. I have been told by a friend, that as the house is over 100 years old, I can get grants to renovate the property. I have no idea how true this is, so could anyone enlighten me with any information please? Thanks :)
Ryan - 6-Oct-20 @ 4:30 PM
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