Planning Your Home Renovation

by Tax Guy - Burlington Accountant on August 19, 2009 Print This Post Print This Post

We have discovered a water leak in the foundation of our house and there is some damage to the interior. Luckily our insurance will cover some of the interior damage but not the leak in the foundation.

Here are the steps I follow to figure out what work will be done, when, by whom and how much it will cost.

Step 1 – Determine The Best Course Of Action

After meeting with a few contractors, it seems there are two ways to repair the leak and get my house back in order:

  • Repair the foundation from the outside – A trench is dug around the outside of the house and a rubber membrane is attached to the foundation and a new drain tile is installed.
  • Repair the foundation from the inside – All of the interior basement perimeter walls and studs are removed. The floor is opened up and a new drain tile is installed and a rubber membrane attached to the inside wall.

Both have their pros and cons. The outside repair means our interior living space is not disrupted but is very expensive. The interior repair is disruptive may be less costly.

Step 2 – Create A Project Plan

If you are going to schedule the contractors yourself or even do some or all of the work yourself, a plan is essential.

A project plan is a list of activities that are required in order to complete a task. The plan describes the general tasks required and assigns time lines to each. It is used to identify which contractors I need (electricians, plumbers, drywall installers etc.) and when they will be needed.

Step 3 – Create A Project Budget

After you figure out what needs to be done you need to figure out how much it will all cost. Your renovation plans may be limited by the amount of money you can spend on the project and your budget will uncover surprises before they happen.

Assigning costs to activities you are unfamiliar with can be a difficult endeavour. Luckily many contractors are willing to give you a general idea of how much to budget, so a few calls here and there can help you figure out your costs.

Step 4 – Revise And Adjust

Construction costs can spiral out of control if you don’t pay attention to your budget. If your project cost is starting to look too expensive, look at your project plan for things you could do different or eliminate.

Doing a renovation on time and on budget is about knowing what needs to be done and the costs.

About The Tax Guy...

Dean Paley CGA CFP is a Burlington accountant and financial planner who services individuals and business owners locally, nationally and internationally. Dean has appeared in the National Post, Toronto Star and Metro News.

To find out more, visit Dean's website Dean Paley CGA CFP or connect via Twitter @DeanPaleyCGACFP.

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