How to Budget for a Home Renovation: A Complete Guide

The First Step Homeowners Should Take when Creating a Budget for a Renovation

The first step is to get specific about what you want to renovate. A vague idea like “redo the bathroom” isn’t enough—you’ll want to break it down into every detail:

• Do you want a new vanity, sink, and mirror?
• Will you add vanity lighting or upgrade the fan?
• Do you want a tiled shower, or is a standard tub enough?
• Will you add niche lighting, new flooring, or storage?

The more detailed your plan, the easier it will be to price out materials and compare contractor estimates. Think of your renovation scope as a living document—you can refine it, but the clearer it is upfront, the better your budget will hold.

Learn more about our renovation services and see how Kootenay Concepts can help your vision come to life.

Common Mistakes People Make when Budgeting for a Renovation

Most “mistakes” aren’t really mistakes—they’re innocent oversights. For example, once a space is gutted, many homeowners see it as a blank canvas and decide to add new features. This changes the scope of work and, naturally, the cost.

The key is to:

• Plan for flexibility.
• Expect that inspiration might strike mid-project.
• Build room in your budget for these changes.

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Hidden Costs People Often Overlook when Creating a Renovation Budget

Hidden costs are some of the biggest surprises in renovations. Common ones include:

• Rot in framing or floors
• Outdated electrical that needs replacing
• Plumbing issues behind walls
• Insulation or drywall damage
• Asbestos or mold remediation in older homes

These issues are often uncovered only after demolition begins, which is why a contingency fund is so important.

How Much Should You Set Aside for a Contingency Fund

A safe rule of thumb is 10–15% of your total renovation budget.

Contractors often build in at least 10% because unexpected costs almost always appear. If you don’t end up needing it, great—it becomes extra savings or can be put toward upgrades.

How to Decide Where to Save vs Spend in a Renovation

One of the best ways to save is by doing your own homework on finishes and materials. For example:

• Instead of paying your contractor hourly to shop for tubs, tiles, or lighting, take the time to make those decisions yourself.
• Use your contractor’s expertise for installation, construction, and problem-solving—not browsing catalogs.

This way, your money goes directly into skilled labor and quality upgrades (like windows, doors, or flooring) rather than consultation hours.

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What are the Average Prices for Renovations?

Prices vary depending on the project, but here are some rough guides:

• Bathroom renovation (9’ x 5’ full gut): $15,000 – $25,000
• Kitchen renovation: $30,000 – $60,000+
• Full home renovation: Budget around $120 per square foot
• New home build: Around $650 per square foot

Keep in mind: finishes, layout changes, and design choices will push costs higher or lower.

Read More: The Ultimate Guide to Basement Renovations Near You

How Homeowners Ensure They Get an Accurate Renovation Estimate

Accuracy comes from choosing the right contractor and being prepared. Here’s how:

• Collect multiple estimates and compare details.
• Check online reviews and past projects.
• Look for transparency in how labor and materials are priced.
• Provide a detailed scope so there’s less guesswork.

Ultimately, the estimate you “click” with—where you feel confident in the process and the contractor’s communication—often proves the most reliable.

Feel free to contact us today to get your free estimate.

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How The Size and Age Affect Pricing and Budgeting

• Larger homes = more square footage, more materials, higher cost.
• Older homes = more surprises. Outdated electrical, insufficient ventilation, water damage, rot, or even asbestos can add major expenses.

Building codes have also changed dramatically over the years, so what was once “standard” may now require a full upgrade.

Read More: Sustainable Eco-Friendly Upgrades for Your Home

Tips to Planning a Renovation Budget

• Break down your scope into details (fixtures, finishes, materials).
• Do your own research on the cost of preferred products.
• Plan for hidden costs with a 10–15% contingency fund.
• Get multiple estimates to compare value, not just price.
• Decide early where to splurge vs. save (e.g., custom cabinetry vs. cost-effective flooring).
• Work with a trusted contractor who will be honest about challenges and timelines.

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Quick Summary for Homeowners

• Start with a detailed renovation scope.
• Budget realistically: bathrooms $15K–25K, kitchens $30K–60K, whole homes $120/sq ft.
• Always set aside 10–15% for hidden costs.
• Older homes = more surprises.
• Do your own research on finishes to save money.
• Choose a contractor you trust, not just the lowest price.

FAQ

Q: How much should I budget for a small bathroom renovation?
A: On average, $15,000–25,000 for a full gut and remodel.

Q: What percentage of my budget should I keep for surprises?
A: At least 10–15%.

Q: Do older homes cost more to renovate?
A: Yes—because of outdated electrical, hidden rot, and stricter modern codes.

Q: Should I hire the cheapest contractor?
A: Not always—look for transparency, communication, and reputation first.

Final Thoughts

Budgeting for a renovation doesn’t have to be overwhelming. With careful planning, clear priorities, and the right contractor, you can create a space that’s beautiful, functional, and within your means.

At Kootenay Concepts Construction, we specialize in guiding homeowners through the entire process—from initial budgeting to final reveal.

Ready to start your renovation journey? Contact us today for a free consultation.

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