6 Tips that will help you save money and stay on your renovation budget
Tip 1: Prime cost (PC) allowances
A PC item is any item with an estimated price. This means that the illustrated or written price is not fixed and the actual cost can vary significantly. Avoid PC allowances if you can so that you have a clear understanding of your costs and you will be able to manage the cash flow for your renovation.
Tip 2: Inclusions and exclusions
Always insist that your quote and your contract contain an accurate listing of all inclusions and exclusions. Be very careful when negotiating for exclusions. What builders charge you to add in certain items may not be the same amount of money they deduct to exclude it.
Tip 3: Variations
Almost all builders include a clause somewhere in their contract for variations to the scope of work. For example, if the builder discovers termites or corroded pipes during the renovation, that would create a variation. Always try to get a copy of any invoices or receipts for materials and labour costs to ensure you’re paying the agreed rate and that there are no hidden charges.
Tip4: Quote expiry
You may find that some quotes may only be valid for a certain period of time. If you’re shopping around for quotes right now but you don’t expect to start your project for another few months, you need to verify that the amount you hope to spend is still valid in that time. If your quote has expired, you may find that costs have risen, which can blow out your budget.
It’s one thing to choose the cheapest quote you receive, but it’s a different matter if the timeframe involved in completing the work blows out to much longer than you anticipated. If you’re paying interest on a mortgage throughout the renovation period, an extended delay or slow work times can increase your overall costs. Always compare the estimated time to complete when assessing quotes.
The timing and schedule of your renovation is up to you. If you are doing much of the work yourself, you determine how long it will take to get things done. You might be restricted to only working on your project on weekends or around working hours. If you have a builder involved in the project, your builder should advise you of an estimated time frame for completion.
Tip 6: DIY projects
If you have the skills and the time, you can stretch your renovation dollars by taking on some of the work yourself. Generally, builders recommend that you leave structural and mechanical renovations to the professionals, but many homeowners can competently do their own painting, landscaping or other finishing jobs. Talk to your builder about the effect of do-it-yourself work on scheduling and the builders warranty, keeping in mind that you should try not to interfere in the way the builder intends to manage the project.