The house renovation budget: Day 1

Posted on September 19, 2007 - Filed Under Business |

Today marks the first day in a series regarding the budget for this project. 

Four months ago the budget was declared: $32,000.

The number was not arbitrary.  While some aspects were "pulled out of the air", I was confident the number would be in the ball park.

When I examined the house, and after conversations with the handy-woman, the aspects of the project did not seem very daunting.

Initially the game plan:

From the initial list, the only items uncertain was the demo of the bathroom and the creation of a master bath.  Those items were purely a shot in the dark.

Then the decision as made to redo all the electrical.  Following thereafter, re-do the plumbing.  Since it was all original stuff in the house, personally I would feel better knowing the bones of the house were up "2007 standards".

Next came the breakdown of who would be performing what tasks. 

Task Responsible
Hardwood Floors Third Party
Re-dry wall ceiling Handy-woman
Paint all walls and ceiling Clifford
Redo main bathroom Handy-woman
Build master bathroom Handy-woman
Update existing kitchen Handy-woman/Clifford/Third Party
Electrical Handy-woman
Plumbing Handy-woman

With the delegation of tasks came the dollar figures for each.  Broken down by Material (M) and then Labor.

Task Budget
Hardwood Floors $1700
Re-dry wall ceiling $1500M + 2Days Labor
Paint all walls and ceiling $1000M
Redo main bathroom $1000M + 4Days Labor
Build master bathroom $750M + 4Days Labor
Update existing kitchen $8000M + 5Days Labor
Electrical $2000M + 5Days Labor
Plumbing $1000M + 4Days Labor

To break a few items down:

For those of you keeping track: the budget spent on materials and some labor was $16,950.  In Southern California, the ratio of material to labor is not 1 to 1.  It is more like 2 to 1.  But considering the original timing was quoted at 6 weeks, $16000 divided by 6 weeks is $2700 per week in labor.  Mentally, I told myself to be prepared for additional costs ($5000).  Whether this may include permits or additional labor costs or material costs.

Right or wrong, I had the numbers and timing put together.  My personal objective was to ensure the numbers were met.

* - This was later increased to $5000 when the old cabinets were deemed unusable and new cabinets would be needed to replace.

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Comments

2 Responses to “The house renovation budget: Day 1”

  1. The Engineer on September 19th, 2007 10:51 am

    Was the initial budget of $32K reviewed and agreed to by your contractors? Did you get any buy-in that $32K would take care of everything on your original list? I thought you told me that just fixing everything on the list compiled by the inspector was $50K. Or, did that include the back house? Basically, you came up with a budget. What kind of check was done on this?
    “Then the decision was made to redo all the electrical. Following thereafter, redo the plumbing.” So how much of a budget increase did you plan for to accommodate this increase in work scope?
    I’ll defer to your expertise, but $1000 in materials seems low for a main bathroom overhaul. It seems especially low after seeing how nicely it came out. It looks like you spent more. Also, a cost of $750 for “building a master bathroom” doesn’t pass the sanity check. Again, I’m not trying to be argumentative, I’m just curious. How can you overhaul an existing bathroom for only $1000 in material, but then build an entire new master bathroom for $750 in materials?
    “But considering the original timing was quoted at 6 weeks.” Was this the actual quote for the original scope of work? How much of an increase in time (and thus money) was quoted for the increase in scope to include the electrical, and kitchen?
    Speaking of the kitchen, you said the last kitchen overhaul was around $25K-$30K. This kitchen was smaller, but no less elaborate; i.e. same travertine tile, same granite counter tops, same fancy stainless steel appliances. How did it come in at only $8000?
    Your initial estimate pegged the cost of labor in Southern California as being typically double the cost of materials. So, looking at your budget, how did you figure a total of $32K, with $16,950 in materials? Using your own logic, wouldn’t that mean that your budget should have been at least $50,850? ($16,950 for materials + $33,900 for labor= $50,850????)
    Quite the merciless inquisitor, aren’t I?? :)

  2. Clifford on September 19th, 2007 9:28 pm

    Engineer, When everyone involved sat down day 1, I set the expectation for the project: 6 weeks with a budget of $32,000. Even adding two extra weeks for whatever else that may have been involved puts the deadline at the end of July. Eight weeks.

    The budget breakdown includes to values: the material required and the labor involved. The material is one dollar figure, the labor is another dollar figure. If you associate the cost of labor, whether it is by the hour the day or week, then you can turn the labor into a dollar figure.

    Since you brought up the Master Bathroom: my estimate was $750 for materials alone. The labor which was 4Days can be turned into a dollar figure based on a labor rate. If the labor rate is $150 per day, then for four days the labor total becomes $600. $750 for material plus $600 for labor equates to $1350 total.

    The rest of your comment will have to wait to be answered in the follow posts.

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