I seriously can’t remember ever building a home, when I was working for another contractor, where the construction budget was actually balanced. Whenever they were my projects, I made sure that we finish the job on budget, unless the homeowner really wanted something extra and understood the consequences.
I can’t stress this enough, to anyone who is interested in building a new home, renovating an old one or simply remodeling your bathroom. If the contractor gives you a price of $25,000 to remodel your kitchen and your budget is $26,000, this should send a clear signal that you only have an extra thousand dollars to mess around with.
I was working on a whole house remodel one time and the budget was around $400,000. The contractor that I was working with at the time wanted to please the homeowners and really didn’t think twice about going over, as and on the construction budget.
When the job was completed, the homeowner had spent over $625,000 and that’s $225,000 over budget and I’m sure that it put this family into some strong financial burdens. This isn’t the first time something like this happened to someone that I was working with or working for.
If you’re building a home and the contractor doesn’t give you a fixed price, you need to find another contractor. You must know what the home is actually going to cost when finally completed. In case you didn’t hear what I just said, make sure that you have a fixed price contract from your general contractor and that everything is included in the contract.
The worst thing that can happen to anyone building a home or remodeling one is to start with a construction budget that is already more than you can afford, only to find out later on that the cost overruns are going to force you into financial devastation.