Hidden Costs in Home Remodeling: What to Budget For Beyond the Basics
When planning your home remodel, it’s easy to focus on the obvious expenses like materials and labor.
But savvy homeowners should know that a successful renovation involves more than just the basics.
At Laurelless, we believe in transparency and want our clients to be fully prepared for their home remodel journey.
Let’s explore some often-overlooked costs you should factor into your budget, with a special focus on what these might look like in Denver (our home base)!
Permit Fees: The Price of Playing by the Rules
One of the first hidden costs you’ll encounter in your home remodel is permit fees.
Many homeowners are surprised to learn that most significant renovations require building permits. These fees can vary widely depending on the scope of your project and your location.
In Denver, permit fees for a home remodel are calculated based on the project’s valuation. According to the City of Denver’s website, for residential projects valued between $2,001 and $500,000, the fee is $50 for the first $2,000 plus $9 for each additional $1,000 or fraction thereof.
For example, a $100,000 remodel would incur permit fees of approximately $934.
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Additionally, you may need specific permits for electrical, plumbing, or mechanical work. These can range from $50 to several hundred dollars each.
It’s crucial to factor these costs into your budget and understand that they’re non-negotiable – proper permitting ensures your home remodel is legal and up to code.
Temporary Housing: When Your Home Becomes a Construction Zone
For extensive home remodel projects, you may need to temporarily relocate. This could mean staying with family, renting a short-term apartment, or even booking an extended hotel stay.
In Denver, this could be a significant expense.
According to recent data, the average monthly rent for a one-bedroom apartment in Denver is around $1,700. For a home remodel lasting 2-3 months, you could be looking at temporary housing costs of $3,400 to $5,100.
If you opt for a hotel, costs could be even higher, potentially reaching $4,000 to $6,000 per month for a comfortable extended-stay option.
Changes in Material Costs: When Price Tags Shift
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The home remodel industry isn’t immune to market fluctuations.
The cost of materials can change between your initial planning phase and the actual construction. Recent years have seen significant volatility in building material prices (particularly in lumber).
For example, in 2021, lumber prices in the U.S. saw unprecedented spikes, with costs rising by as much as 300% at certain points 🤯. While prices have stabilized since then, the construction industry continues to face supply chain challenges that can impact material costs.
To protect yourself from these fluctuations, consider building a 10-15% buffer into your budget for materials (P.S. Any contractor with their salt will also account for those buffers in their quotes).
Storage Costs: Finding a Temporary Home for Your Belongings
During a home remodel, you’ll likely need to clear out the spaces being renovated. Depending on your situation, renting a storage unit to keep your furniture and belongings safe during construction could become a necessity.
In Denver, the average cost for a 10×10 storage unit (suitable for the contents of a one-bedroom apartment) ranges from $100 to $200 per month. For larger homes or more extensive remodels, you might need a 10×20 unit, which can cost between $150 and $300 per month.
Also, consider the cost of moving your items to and from the storage facility – professional movers in Denver typically charge between $80 and $100 per hour.
Furniture and Decor: Dressing Up Your New Digs
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After your home remodel is complete, you might find that your existing furniture and decor no longer fit the new aesthetic or layout. Budget for new pieces that will complement your freshly renovated space. This could include everything from major furniture items to small decorative accents.
The cost for this can vary wildly depending on your taste and the size of your space. As a rough guide, you might budget anywhere from $5,000 to $20,000 or more to furnish a living room, and $3,000 to $10,000 for a bedroom.
Remember, you don’t have to buy everything at once. Consider prioritizing key pieces and adding others over time as your budget allows.
Waste Removal: Clearing Out the Old to Make Way for the New
A home remodel generates a surprising amount of debris and waste, and dumpster rental/ disposal fees are often overlooked in initial budgets.
In Denver, the cost to rent a 20-yard dumpster (suitable for most medium-sized remodels) ranges from $350 to $550 for a week.
You’ll also need to consider permit fees to place the dumpster on a public street (if necessary).
Your contractor more than likely has relationships with a company that could result in better rates!
Increased Property Taxes: The Long-Term Cost of Improving Your Home
While not an immediate expense, it’s important to consider that a substantial home remodel can increase your property’s value.
This is generally good news, but it can lead to higher property taxes.
In Denver, property taxes are calculated based on the assessed value of your home.
As of 2023, the assessment rate for residential properties is 6.765% of the actual value.
For example, if your home remodel increases your property value by $100,000, you could see your annual property taxes increase by approximately $470.
Planning for Short and Long-term Success in Your Home Remodel
These additional costs can seem daunting at first. But remember – they’re an investment in your home’s future value and your quality of life.
By planning for them upfront, you can avoid unpleasant surprises and ensure a smoother, more enjoyable renovation experience.
At Laurelless, we’re committed to helping our clients navigate every aspect of their renovation, including budgeting for these often-overlooked expenses!
Our Concierge Contracting Experience ensures that you’re informed and prepared at every step of your home remodel.
Ready to start your home remodel with a team that prioritizes transparency and comprehensive planning?
