How to Budget a Kitchen Remodel
Let’s be honest, every single homeowner out there would like to pluck the most extravagant and beautiful kitchen from a design catalogue and transport it into their home, however, the budget simply does not always allow such luxuries. Budget is king when it comes to kitchen remodels, which is why you need to thoroughly plan out your finances before settling on a budget and starting the remodel itself.
Ask yourself the following questions:
Remodeling for yourself and remodeling to sell are two very different things. When remodeling with an intention to sell, it is important to set a strict budget and never overspend. Before you even start, you should research the local area with the help of an estate agent to find out average prices, with your kitchen budget being calculated based on these. Remember, the aim of the game is to spend money on the kitchen in order to make money on the sale, rather than losing cash because you went too heavy on the remodel. If you are remodeling for your own pleasure, it comes down to designing a kitchen that works and that you love.
Before remodeling, you should get an accurate valuation of your property. The general rule is that you should never spend over 15% of your total property value on the kitchen remodel. If you are looking to remodel with the intention of selling, between 8 and 10 per cent is your sweet spot. It is also worth noting that if you have only just moved into the property, you must first evaluate any other financial outgoings that could come from construction.
If you currently have debts, you need to take them into account before deciding on a remodel. Can you afford it? How much can you afford? Do you need to take out a loan? If so, what is your debt-to-income ratio? Lenders will only give you money if they are satisfied with this ratio.
After evaluating your debt, expenses and income, you can now finally settle on an overall budget for your kitchen remodel. It is important not to compromise on this budget as the money will be split between so many different aspects of your kitchen, from countertops to electricity, plumbing and the cost of fitting it all. Fortunately for you, we have a helpful kitchen remodel calculator that you can use to accurately split your funds into different sections. You should also keep 10% of your overall budget back in case of unpredictable expenses, such as termites or mold.
