Where does money disappear in a renovation or new build?
There are many things required to create a new or renovated home. They can chew up your budget and yet be almost invisible in the finished home. Read on …
As you begin to design and plan your new home or renovation, chances are you’ll be … looking at the spaces you want to create … how you want to wrap them up (their size, shape, etc ) … and what you want to put in them.
When you start to allocate your budget to these dreamed and imagined spaces, finishes and fixtures, it can be a surprise to see how quickly it gets consumed.
And often, in my experience, the reaction can often be “But where is all the money going?”
There are many things required to create a working, finished new or renovated home, and they can chew up a significant chunk of your budget – and yet be almost invisible in the finished product.
Let’s go through some of these things, and what you can do to manage them in your project.
Services – Plumbing and Electrical
Your services are the invisible spaghetti that runs behind walls, under floors and in ceilings to give you all the modern conveniences we so love having in our homes. Running water, lights that turn on and off, and toilets that flush.
Services are usually one of the first things that need to happen on site too. Before concrete is poured, pipework will need to be run into your home and located correctly to create penetrations (ie holes) in your floor slabs to allow water and power to run to where it is required.
If you’re renovating and increasing the number of plumbing points in your home, you can trigger the need to upgrade your services overall. This can also apply in electrical work, as meter boards may need to be upgraded for additional power types (say, for airconditioning) and for extra loads.
There can also be additional work required with the services to and from your actual block of land. You are required to get storm water from your property to the street. Sometimes your existing services won’t have this in place, or it will be running through a neighbour’s yard. Or the slope of your block means you’ll need to pump it to the street, or get permission to run it formally through the neighbour behind you.
In a renovation, upgrading can also be an unexpected cost for old homes. When you renovate significantly, you generally need to bring ALL electrical and plumbing up to current standards. Things like wiring, smoke detectors, old plumbing fixtures, non-water-efficient tapware, non-energy efficient light fittings, can sometimes all need replacing to achieve building approvals (depending on the amount and type of work you’re undertaking).
Protect your budget by:
- In renovations, locate new wet areas near where old wet areas were to help minimise reworking of plumbing
- In new builds and renovations, locate wet areas near each other or above each other (when doing 2-storey homes) to minimise plumbing runs
- Locate your hot water unit close to where it’s needed the most, to minimise running costs and water wastage (waiting for the hot water to arrive at your tap)
- Lock down the plumbing layout before you start your build, as changes to this on site can either not be possible, or very costly once construction starts
- When planning your electrical, the “more-is-better” approach to power points only works so far. Really think through what you’ll be plugging in and where, so you allow double points, and single points in the best spots (and can hide them from view with furniture). For example, behind your fridge, your oven, your dishwasher, your microwave – you’ll usually only have that appliance plugged in, and the powerpoint hidden in a cupboard, so a single point will suffice. Architects call powerpoints and light switches “wall acne” because when it’s not arranged with care and intention, that’s what it looks like!!
- Get advice from a lighting supplier or consultant for your electrical lighting design. It’s an easy area to overdo AND underdo, and retrofitting is challenging. I recommend dimmers on dining and living areas for flexibility.
Excavation and Retaining
Your site may look fairly level, but it’s amazing how even the flattest of sites require some earthworks to put a flat concrete slab on them!
Getting your site ready for your new home or renovation is another area where money can disappear. Apart from the actual cost of earthworks … in terms of the machinery to dig, flatten and take away the soil … there can be the approval costs required with your local council to do earthworks, as well as unexpected costs if you hit rock whilst digging.
Then there will be the cost to hold the dirt back – or retain it. If you’re working on a sloping site, or excavating into your site to create some lower floor space, you’ll need to put structure in place to securely hold all that dirt back from your home. In addition, you’ll also need to help the wall stay straight – by building it sufficiently strong, and providing opportunity for water to get away so it doesn’t sit behind the wall and put extra weight on it.
Any retaining wall that is one metre or more in height, even in a garden, will generally require structural engineering advice – ie an engineer to draw it, and to sign off that it’s been correctly constructed. And most councils require approval if you intend to do more than one metre cut or fill (so take away or add one metre or more in height to your natural ground level).
The conventional approach to renovating an old Queenslander or weatherboard home is to raise and restump it, and then build in underneath. It can seem like an inexpensive way to claim space already used on the site – but currently just too low in head height.
The house restumpers may tell you it’s around $20,000 – $30,000 to restump a house – which can seem really affordable. But what is not factored in is all the excavation and retaining work that can then be required to create a level area under the home to pour a concrete slab and build walls. This can add significantly more to what initially seemed like an affordable option.
Protect your budget by:
- Where possible, reuse the dirt you excavate on site. Transport costs to relocate dirt are a big part of the cost of excavation.
- If you’re planning a pool and think you’ll re-use the dirt on site as part of future works, get a master plan designed for your whole project first. You don’t want to limit what you can do down the track because of where you located the pool.
- Keep the height of your retaining walls under one metre if you can.
- Get your site properly surveyed, and use this information to best determine at what level your new home or renovation may be positioned. The smallest tweaks in height can save big dollars in earthworks costs.
- Determine the cost of these works early, and build in some contingency for surprises on site.
- Don’t scrimp on waterproofing retaining walls, and providing suitable drainage – you’ll pay far more in the long run.
Your home’s skeleton – the structure
Contemporary design, be it for a new build or renovation, will often mean open plan design, connected rooms with few internal walls, and large areas of glazing to let in all that gorgeous natural light (facing the right direction of course!).
Imagine a rigid cube. You start cutting holes in the walls of it. Take out one or two corners. How rigid is it now?
With the invention and use of steel and glass, our homes went from being a series of quite cosy, dark and connected rooms, to generous and open plan, transparent and light-filled buildings. However, they are still structures that need to stand, withstand natural forces, and keep a roof over your head.
There is of course the direct vertical load of holding a roof up. If there aren’t internal walls to hold up the roof, or the walls have lots of holes in them, you’ll need extra structure to span the larger distances – either steel or engineered timber depending on the span and the load on it.
There is also the lateral strength – which stops the home moving from side to side. So if you think of your rigid cube again … when you start cutting holes in the sides and corners, you can push and twist the cube quite easily. Bracing is what stabilises this – extra structure that will stop that twist and push. This can be done with sheet material such as plywood, and sometimes steel is required.
All of this steel, engineered timber and plywood gets hidden inside your walls. It’s an invisible skeleton of your building that enables you to have the open spaces and big areas of glazing. But it costs more money than conventional building methods, and will only be visible in what it creates – not what it actually is.
In fact, if you do decide to show it off – ie have expressed timber and steel structure, you’ll generally pay more for it, because it will need to be a higher level of finish that its standard.
Conventional, residential building is generally in timber stud frame. It’s lightweight, easy to handle, cheap, quick and easy to install – and easy to change on site.
Steel is not. It’s heavy to move, needs to be accurately sized for use on site, and involves special fixing and welding to put together.
Protect your budget by:
- Limit the structural gymnastics you’re asking your design to perform. You can still achieve open spaces and lots of glazing without needing extensive amounts of steel structure (and the added expense).
- Don’t design the spaces, and think about the structure later. Any designer you’re working with should be integrating the structural design at the same time. It’s the best way to capitalise on efficiency and economy in your design.
Extra living bills
This one is worth mentioning purely so you can budget for it.
If you’re creating your new home, or renovating your existing one significantly, chances are you’ll need to be living somewhere else.
This may mean paying rent whilst still making mortgage payments on a home you don’t live in yet. You can also be paying two sets of utilities. Council rates don’t stop just because you’re not there, and you may be paying electricity bills at two addresses.
Protect your budget by:
- Factoring these costs into your building budget upfront
- Allow some contingency if your build takes longer than expected
- If renting, weigh up whether it’s cheaper to put a lot of your personal items and furniture in storage, and renting somewhere smaller for the duration of the project … rather than renting somewhere big enough to house everything
There’s more …
These are a few of the areas I know can gobble up your budget, and make you feel like you’re not getting much in return. They can seem like the boring necessities of your build, and you can resent them requiring allocation in your budget.
There’s many more like this. Site establishment costs, insurances, scaffolding, council application fees – to name a few.
All required, and all critical in completing your project. However, when you are dreaming of your finished new or renovated home, they’re not usually where you imagine you will be spending your money.
Factor them in early, and include them as your plans develop. Protect your budget so you still have money left for the things that aren’t so invisible, and are more fun to spend money on!
Paula Young says
Hi There, I stumbled across your site yesterday in a fabulous demonstration of serendipidty! I am currently undertaking a diploma of building design through NSW TAFE (in my second year of 4), and have just exchanged contracts on a block of land we plan to build on. Love your site and would appreciate being put on your weekly email list. Kind regards, Paula Young
Thanks for your kind comments about UA. Will email you now.
– Amelia, UA x
Jackie Cesnik says
I am awaiting settlement of an estate and have seen a property I would like but have no idea if I could afford to renovate the unimaginative 20 year old structure that’s already there or even demolish and rebuild
I have no idea where to start on such a project and would appreciate any advice
There’s loads here on Undercover Architect to help you with your project. Also make sure you check out the podcast – it will help you with the design, the budget and knowing who to have on your team. If you want more support, Your Reno Roadmap is for you.
– Amelia, UA