One of the realities of an addition or renovation project is the likelihood of a few surprises along the way, most of which are regrettably unpleasant. In contrast to a new home, where there is less potential for surprises to catch you off guard, a renovation may include a variety of surprises that are not apparent until work has started. Electrical work upgrades, structural alterations, and waterproofing concerns are frequent issues.
There are typically two ways that renovation result in extra costs. First off, the builder might include a contingency in their estimate to cover some of these unforeseen costs. Second, the unexpected costs may be recognized as changes to the original contract price as they occur, which would add a builder’s profit margin of up to 20% to the cost of the unexpected work. In certain cases, both of these scenarios will come to pass, and even after a small adjustment has been made in the price, the real cost of dealing with unknowns will be higher than what has been anticipated and quoted. Do you want to know more about this? Stop, read hammer time.
Your home is more likely to have had work done to it the older it is. While some of that work could be readily apparent, the majority of it is probably concealed above, below, and beneath the ceiling. Moreover, once the job is started, it is impossible to determine who did the work or how well it was done. Similar to the surprises previously discussed, the necessity to improve or fix prior work may result in large cost increases for your project. If you are aware that your property has undergone renovations, you should be aware that you may need to budget for some rectification fees.
For remodeling and addition projects, the quality of your paperwork is essential because it must precisely define the scope of the job. The designs for a rehabilitation or addition project will represent both the current house and proposed improvements, unlike a new home where every component of the project is new. The builder and trades need to understand from the designs and accompanying documents which sections of the building are new and which portions are existing, as well as whether or not those that are old are being renovated, refitted, refinished, repainted, etc. It is more likely that low-quality documentation that does not make this evident to builders will result in either erroneous or exaggerated quotes.
One of the main benefits of building a brand-new home is that because you are beginning from scratch, there are probably going to be less design compromises, even though the money is probably still going to be the main limiting factor. Renovations and additions that tolerate some plan sacrifice in order to stay within budget tend to be the most cost-effective. That’s because, as I already indicated, it can be rather expensive to renovate an existing house’s plan and demolish additional portions of it in order to overcome these compromises.
