photo/design credit Luxe Interiors + Design
The Truth About Construction Budgets: 5 Must-Know Tips for Staying on Budget Throughout Your Build.
1) RULE#1 Let your entire team know up front about your financial goals, budgets and expectations. Many times homeowners aren't forth coming with their overall budget early on in the project. Folks....this should be the first order of business before making selections or signing contracts. I can tell you with absolute certainty the chance of hitting a budget without engaging other members of the build is almost zero. Regardless of the size of your budget, be honest with your team on where you want to be.... let them guide you and offer suggestions so you can meet your goal. This allows you as the homeowner to take full advantage of your team's expertise and years of experience in the industry.
2) RULE #2 Talk honestly and openly about money through the entire build. I know many of you just cringed.... but.... the painful truth is as a homeowner it is ultimately your responsiblity to maintain your budget. Many people think their builder will let them know if they are "too far off" the mark financially. Homeowners assume their builder (or designer) would let them know if they have been over budget on almost every single selection to date!!!! Folks that's not the case the majoirty of the time. I am giving you full permission to ask questions, ask for visuals, and or ask for explanations. Its your money and your home..... you have every right to be informed, engaged and asking questions. Start early.
RULE #3 Verify, Verify, Verify! Maintaining a construction budget is possible however because many homeowners arent familiar with pricing and terminology in the industry I strongly suggest that all selections and/or quotes be verified by the builder before they are processed as an actual order. For example, your tile selections.... after hours of getting the perfect product selected and quoted. Send the quote to your builder to be sure all needed items have been accounted for and you are either under, on or over budget. One more tip.... do all budget verification via email. Its just an easier way to track information.
RULE #4 Track the entire budget. Over the length of the build, many homeowners focus on only the budget overages. However, you need to be tracking the entire budget folks!! Did you remove stone from a chimney? Take out the outdoor kitchen? Decide to do carpet not hardwoods in bedrooms?? Those are savings in your overall budget that can help offset an overage in another area. Often times a few underages will compensate for an item you went over budget on.
RULE #5 Do a once-a-month budget check with your builder. I know you're busy... But if your budget is a priority you'll make time. Schedule a set time once a month to get a routine going. This can be done in person on a jobsite or easily over the phone. The goal is to see where the build is financially month to month as the build progresses. Essentially this is a discussion with your builder about "where you re over and /or under budget to date". Ask your builder to email you a basic spreadsheet with the break-out cost for the home so you can visually see your financial standing with the build. This will help you better track overall cost month-to-month and give you assurances (not to mention peace of mind) with your custom build budget. Oh and monthly check ins help head off huge surprises at the end of the build on items over budget or not included in the original scope of services!! Good to know.....
For many folks their home is their largest financial asset.....yes it takes work and time to understand and maintain a budget over the length of the build. Many people are uncomfortable asking questions regarding money and talking about more cost-effective options. With that in mind, homeowners work and save for years to be able to build a custom home why wouldnt you take every measure possible to ensure you understand where your money is going. Begin these 5 simples steps at the beginning of your build and you will be amazed at how it can reduce the finacial stress of building a home. Happy building !!!