Tuesday, 5 May 2015

Money Maker or Money Pit?

Our renovation project

In the lead up to our renovation I watched countless episodes of Grand Designs,  tutting and rolling my eyes. How could people manage to go so over budget? Imagine being forced to stop the build to wait for planning issues to be resolved!

In reality it is easily done.  You do not have a crystal ball and unexpected costs surface...

Our finished English Country Home

So, here are my top tips to make sure your money making renovation project does not become a money pit!

Before you buy...

Get at least 3 quotes from each of the trades you are planning to use. Do not necessarily go for the cheapest, but look also at their service so far: Did they respond to you promptly, did the quote come through quickly and clearly, are there hidden costs they had not mentioned, do you get on with the them? You will be dealing with them on a daily basis for the duration of the project and it will not always be plain sailing.

Beware day rates. Get quotes for the finished job.  If it takes longer than they think then the financial burden rests on their shoulders not yours. It also gives them the incentive to get the job done quickly and efficiently.

Get it checked out by the pro's. Make sure you have asked a builder, roofer, plumber and electrician (at the very least) to take a look at the property thoroughly before you commit financially. Our Estate Agent was happy for us to have an extra viewing in order to do this. You will then know if there are any glaring structural problems, whether the house needs a new roof, re-wiring, a new central heating system, new boiler... knowing about these costs upfront will allow you to budget more accurately. 

Get your builder to have  a
good look around for any
potential issues
Get ball park figures.  These will need to be pinned down in writing and in fine detail as soon as you can. For now it will give you a clear indication if buying this house is right for you and that ultimately you will make money not lose it once the project is finished.

Set a budget and add a contingency of at least 15%.  Things happen during a build once you start peeling back the layers of the houses; things hidden from the eye can surface and cost big bucks. Make sure you have the money in the bank.

Structural Surveys. In every property a structural survey will throw up list of suggested issues and with older properties the list might seem exhaustive.  It is up to you and your builder to assess which are real issues and which you should merely be aware of.

Who is the Project Manager?  This was not our first renovation project, we have done quite a bit of work on previous houses and have a stable of good, reliable contacts. We knew they would turn up, do a good job and that we had a good working relationship.  In the past our builders have project managed for us, for which we paid a fee.  This time Jonathan and I did it ourselves but purely because we had the a) contacts and the b) time to manage it.  If either of these things had been absent we would not have undertaken this role.  It really is a full time job in itself.

Bats are protected and you need
permission to move or disturb them
Planning Laws: We knew our house had already been extended and we would be limited in the amount we could extend. However the rules change all the time so it is good to be up to speed. We live in a conservation area so although we were not listed, strict conservation planning laws apply. Visit your planning officer who can talk you through all the up to date laws.

It is not just buildings that are
protected you might need
permission to remove trees or
hedges from your garden

Bats! Find out if you will need a bat survey and plan accordingly.  The survey itself is not cheap. We needed a survey as bats are prevalent in our area but our timing was lucky. Depending on the time of year you are purchasing your property you may or not have to wait until the hibernating season has ended before you commence any works.  We got our survey booked just before the cut off for dates for hibernation so were able to establish that although there had been bats in the past, they were no longer present. Another cost to consider is the the cost of re-housing any bats found. For further information follow the link: martinecology.co.uk

Planning laws on trees and hedges. Did you know that planning laws might also apply to your garden? Certain trees such as the Oak or hedges such as the Yew could be  protected.  We had trees and bushes we wished to remove to make space for a lawned garden and had to get permission in order to do this. It is a good idea to ask a tree surgeon's advice and then talk to the relevant planner.  For us, being unable to alter the garden would have had a serious impact and we would not have proceeded with the purchase.

Photocopy and draw over estate agents
flat plans to discover what work best
for your renovation
Play around with the layout. Once you know your perameters, photocopy the floor plan of your renovation project and  re-configure it to suit your lifestyle. Sometimes it just doesn't work.  However, often there are different options and it is worth exploring them all at this stage to get the right one.  It took us quite a few photocopied scribbles before we came up with a plan that worked for our renovation. Take these along when you visit the property and get the builder to tell you if you can do them in principle and what it would cost.  For us this included moving doorways into rooms, knocking down cupboards and moving walls to maximise our space.

Waiting before you start?  If you are aiming to move in and live in the house for a while before you start your renovation, make sure all the quotes are still going to be relevant when you want to commence.  Costs change all the time especially as building materials rise so make sure the builder puts an end date on the quote and signs it!

You may prefer to live off-site while renovating which is
an additional cost factor
Live on-site? If not, you need to factor in renting or a temporary caravan in your garden. You should to be clear how this will work and what will happen if the project over-runs. This could end up being a big financial consideration if not part of the initial budget.

Need a Building Surveyor? If you are extending your property or making structural changes you will need to contact a building surveyor before you start to find out if and when he should visit the site for inspection.  If he does need to come he will want to visit at several points during the build. Without him you will not get your building regulations certificate and the extension might have to come down! He will also have a cost implication.

Structural Surveyor? If supporting walls are coming down you will require the services of a structural surveyor.  He will calculate the steels you need and that the proposed changes are safe for the overall structure.  You should research his fees for your budget.

VAT. Don't forget to add VAT onto your quotes if not already included.

Before you start renovating ...

Make sure you have planning consent. This can take up to 3 months and sometimes longer depending on the complexity and how busy they are. Either way it is very risky to start work before you have it. Although they might have said yes to the works in theory,there may be elements planners ask you to change in order to receive consent. The planners are within their rights to ask you to undo works done if they are not approved; a costly mistake.  

Agree a schedule of works with your builder.  Have it in writing - you will most likely have to write it yourself.  It will change but it gives you all something to work from and amend as you go along.  It also allows costs to be split down into different jobs if you need to cut back later on.  It is a  lot of work initially but is worth it as it acts as a 'bible' for the build.

Nail down the quotes! Get the trades back to go into fine detail on their quotes. Include absolutely everything on your schedule of works and give them estimated dates on the timetable of your project.

Get your trades talking. Make sure they meet as early as possible, ideally before work starts.  It makes for a better ongoing relationship as they will need to work together across the project.

Start up a spread sheet. Include every cost for every trade for the whole project based on the quotes you have.  Know what you have spent, still have to spend and who you have paid.  There will be quotes you have not received and costs not pinned down. Make a healthy estimate and update as soon as you have the figures in - err on the upper side of what you think here.  Better to reduce costs than have to add to them!  If you are project managing yourself it can get complicated and you need to have a good handle on your finances at all times.

Make sure everyone is fully briefed. Give trades a diagram of each room. Include location of sockets, radiators, plugs etc and talk them through it.

Scrap book / Mood Boards. Start compiling a page for each room .  It will not only help you visualize and allow you to show your trades the look you are going for, it is also a great way of showing them the exact socket, light fitting, tap, bath etc.  They may be able to get these items much cheaper themselves.

Once Underway...

Keep talking!  Have regular meetings with your builder, project manager and trades to see how things are progressing.  Discuss every aspect of the build to make sure that there are no mis- communications.
Meet regularly with your builder so you
keep up to date and can discuss issues
Give Warning when changing timescales. Your trades know things constantly shift and deal with it all the time but the more notice you can give the better.

Compromise. Be prepared to compromise and if necessary change direction.  You have to keep looking forward in a build.  Things happen and you cannot always get what you want even if money is not the option. In so many of these instances our compromises ended up being better than our original plan!

Receipts.  If project managing, get a receipt from each person you pay.  Keep it and make a note on your spread sheet that they have been paid.  We had a trade who, in good faith, thought we had not paid them and I was able to prove it.  I could very easily have lost or mis-laid the receipt then it would have been my word against theirs. If paying the builder direct similarly ask them to sign a receipt for each installment of money so you have a record.

Amending your plans. If you make additions to the planned building works during the project make sure you have the money to cover them and contingency.  Otherwise stick to the original plan.

Tea and biscuits will keep everyone
working hard for you!
Approvals. Make it clear that each stage fixes have to be approved by you not just your builder.  Everyone interprets things differently (which is why the visual scrap book can help). You need to approve the look and position of things of things before it is too late to undo.

Remember you are the boss. Sometimes things are wrong, not up to standard or simply don't work and have to be re-done.  Have the courage of your convictions as long as the financial penalty doesn't preclude doing it, you will be pleased you were a perfectionist. You are paying a lot of money and you need to be happy with the finish.

Tea Time! Stock up on milk, biscuits, tea, coffee and sugar - and if you make the odd cake on a Friday everyone involved will work all the harder for you!

I hope you have found this article useful!  It is based on our own experiences to help and inform. I would love to hear your feedback and comments. 

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Thank you for visiting my home renovation blog. Please like and share with your friends to spread the word. I would love to hear your comments and feedback. Hope to see you back here soon! Lucinda