Mapping Your Financial Route First up, finalise your figures. Just like you wouldn’t set off without knowing how much you can spend on fuel, food, and hotels, you shouldn’t swing a hammer before budgeting for materials, labour, permits etc. It’s important to consult with architects, engineers, and contractors early on to get a realistic idea of what your project entails and the costs involved. This will be the backbone of your budget.
The 10% Contingency Fund Let’s talk about the scenic route—those unexpected detours and issues along the way. In construction terms, these are the “just in case” moments. For these surprises, stash away a good 10% of your total budget. Think of it as your emergency fund for when you stumble upon an unexpected problem, such as unearthing electrical wiring that’s straight out of a history book and needs updating. Common causes of overspend are: unforeseen site issues, poor initial estimates, material price fluctuations and labour shortages.
Why 10%, You Ask? In the world of building and renovation, if something can happen, it probably will. Almost 70% of construction projects go at least 10% over budget, so whether it’s a sudden change of heart about the kitchen tiles or a structural surprise behind a wall, having a financial cushion means you can address these unexpected expenses without the project grinding to a halt. That extra 10% could be the difference between a dream home and an unfinished project.
Trimming the Fat Without Cutting Corners Having a buffer doesn’t mean you’ve got a free pass to splurge on a whim. It’s about smart spending and knowing that sometimes, doing the job properly is worth the extra penny. You wouldn’t buy discount tyres for that cross-country trip, so don’t skimp on crucial materials or skilled labour.
Navigating the Budget Highway As you travel down the budget highway, keep an eye on your dashboard. Regular check-ins on your spend against your planned budget will help you avoid running out of funds mid-journey. And if you’re cruising along with that 10% still untouched towards the end? Well, that’s the perfect time to consider whether you want to upgrade to heated floors or add that garden pergola.
In Closing Remember, a well-planned budget is your roadmap to a successful construction project. With a clear financial path and a buffer for the unexpected, you’ll reach your destination with a project you can be proud of.
