Where Does Your Money Go During A Renovation?

There are some costs to a renovation that you may not realize

 

Whether you are planning on renovating your home or are in the middle of a renovation, you might wonder where your money goes in addition to the cost of labour and materials. 

At Focus Construction, we’re known for our transparency, so we’ll lay it out for you right in the open and show you exactly where every dollar is being invested. If your contractor doesn’t make you feel comfortable asking direct questions about exactly where those hard-earned dollars are going, then there could be a problem.

Here’s a full breakdown of all of your costs:

35-40% – Labour
A renovation is very labour intensive, so it will come as no surprise that a significant chunk of your budget goes towards those working on your home, and most notably, trades workers.

There are renovation companies out there that will try and underbid or promise a low price just to get your signature to complete the renovation, but the quality of work will likely be rushed and compromised.

Additionally, these companies often use trades and contractors that offer heavily discounted rates but often aren’t able to complete work in a timely manner. You must consider whether lengthening the project is worth the amount of money that you are saving, keeping in mind that delays can also add to the overall cost. 

Focus Construction only works with qualified tradespeople that are insured, WSIB registered and focused on high quality craftsmanship so that things are done right the first time, and on time. 

Also keep in mind that certain trades are paid a higher hourly rate than others and a higher skilled labourer or tradesperson will be more expensive than someone less experienced or talented.   

It’s important that your contractor has a good relationship with their tradespeople so that communication is efficient, they can work together to solve problems, ensuring that work is completed reliably and on time.

35-40% – Materials
The other large cost contributing to a renovation is the materials. Cabinets, flooring, tiles, drywall, framing materials and insulation will likely make up the largest chunk of your budget.

It is important to investigate the materials going into your renovation to ensure high quality. There are many products on the market that may be a bargain, but chances are that they are inexpensive for a reason and will result in paying more to fix then the amount that you saved in the first place. 

You should feel comfortable asking your designer or contractor questions about the materials being used and for any recommendations that they may have.

So, where else does your money go? 

15-20% – Management Fees
Management fees vary in the industry depending on how full service and experienced your contractor is, as well as the scale of the project.

Focus prides themselves on being a transparent contractor and always being clear about exactly how much of your budget goes towards the management fee. 

For most projects, Focus is proud to offer their clients a competitive 15% management fee with exceptions for specialized renovations and complex projects.

5% – Garbage
A great deal of debris, off-cuts, old materials and garbage is created when renovating a home. Approximately 5% of your budget will be used for 20-plus yard bins to haul away old materials that have been removed from your home. 

However, not all material removed from your home goes to landfill. Focus Construction is conscious of the environment and the impact that construction can have. We will do our best to recycle what we can, and we also work with scrap yards so that metals can be melted down and reused.

Additional Project Costs

Permits
Permit costs can range widely. A permit for a new deck may only cost a few hundred dollars, but a permit to construct a new house or complete a large-scale home may be in the thousands. In the city of Mississauga, for example, the municipality charges a development fee for new builds that can cost upwards of $75,000 per lot.

Designers
When building a new home or undertaking a large scale renovation, Focus Construction recommends using a designer like Two Birds Design. Designers will help you with fixtures, colours, appliances, layout and general flow of the project. This allows the project to move at a faster and smoother rate and will assist in getting your project finished on time. Designers fees will range from 8-15% of your budget for materials. 

Architects 
Architects are needed when designing a new build and they have the ability to design your dream home from scratch while ensuring that all of the drawings are up to code. While architect fees vary from job to job, you can expect to spend between $2,500 – $30,000.

As with many purchases, you get what you pay for. Investing in a transparent contractor who uses quality materials and qualified tradespeople and professionals will get you the lasting renovation that you want, and the peace of mind knowing that it will stand the test of time. Focus Construction is that contractor. 

 

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