Renovation Budgeting: How to Avoid Cost Overruns

One of the biggest challenges in real estate investment is accurate renovation budgeting. Here's how we approach it at J.D. Higgins LLC.

## The 20% Contingency Rule

Always add 20% to your initial renovation estimate. This buffer accounts for:
- Unexpected structural issues
- Permit delays
- Material price fluctuations
- Change orders

## Budget Breakdown by Category

### Kitchen Renovations
- Basic update: $15,000 - $25,000
- Mid-range: $25,000 - $50,000
- High-end: $50,000+

### Bathroom Renovations
- Basic update: $8,000 - $15,000
- Mid-range: $15,000 - $25,000
- Luxury: $25,000+

### Flooring
- Laminate: $3 - $7 per sq ft
- Hardwood: $8 - $15 per sq ft
- Tile: $5 - $12 per sq ft

## Cost Control Strategies

1. **Get Multiple Quotes**: Always get at least 3 bids for major work
2. **Itemize Everything**: Break down costs by material and labor
3. **Track Daily**: Monitor spending throughout the project
4. **Plan for Delays**: Factor time delays into your budget

## Common Budget Busters

- Electrical upgrades to meet current codes
- Plumbing issues behind walls
- Structural problems discovered during demo
- Permit complications

With over 11 years of experience, we've learned to spot these issues early and budget accordingly.