Budgeting for Your Bathroom Remodel
When you’re looking into any sort of remodel, one of the first questions is the big one: How much is this going to cost? Figuring out how much you can afford versus what you really want your new bathroom to look like can keep you up at night, running through designs and figures in your head. This is especially true if you plan to sell your home, as you’ll have the added question of how far that remodel should go to get the attention of potential buyers.
Understanding the bathroom remodel average cost might not be easy, considering the countless possibilities for this very important room in your house, but learning the best way to budget for the changes can help you feel more comfortable with your choices.
Budgeting for Your Bathroom Remodel
Let’s start with the bathroom remodel average cost. According to Remodeling Magazine’s 2020 Cost vs. Value Report, the national average cost of a mid-range bathroom remodel runs about $21,377. If you’re looking at a more luxurious change, the average cost jumps to $67,106. Just looking to add some universal design elements to make the bathroom friendlier to those who want to age in place? You’re looking at a national average of about $34,643.
There are two important takeaways from those numbers: First, that this is a national average, so it includes high-end homes that sell for millions as well as more modest homes that sell in the five figures. That means your remodel might not come close to these national average prices.
Second, remember that there are numerous ways to achieve your goals even on a tight budget, such as choosing more affordable materials or remodeling only parts of the bathroom instead of doing a full-scale revamp.
Calculating What You Can Afford
When thinking about your bathroom remodel, look at a variety of factors: Start by looking at your income and how much you can reasonably afford to take away from that monthly stash to put toward the remodel.
What about your savings? Do you have the kind of cash there to pay for what you do with the bathroom?
Consider that what you’re creating is an investment in your home and in the potential resale value. To that end, speak with a realtor about what is in demand in your area and what changes really make a difference. Speak to a variety of contractors as well, to get their take (and their quotes!) on what this is going to cost you.
What About Using Your Home Equity?
Let’s be honest: Most people can’t afford to simply drop cash on the full cost of a bathroom remodel. Therefore, moving around money carefully is often the name of the game when it comes to creating a budget you can actually afford.
Many people take this opportunity to look at their home equity. Simply put, home equity is the difference between what you still owe on your property versus what it might bring in on the market.
In most cases, the longer you’ve lived in your home and the lower your mortgage is, the more home equity you will have. Many people can tap into that home equity and pay for the cost of a remodel, and it might be a smart move if you intend to sell the home soon.
Take a Hard Look at Your Credit Rating
When it comes to home equity or any other kind of financial instrument designed to help you pay for something big, financial institutions always look to your credit rating. The Consumer Financial Protection Bureau defines a credit score as a way to predict “how likely you are to pay back a loan on time.”
Institutions that pull your credit report will look at a variety of factors, including how much revolving credit you have available, how well you’ve done with paying your bills, and how your overall credit looks. When you’re thinking about remodeling and looking at the potential need for home equity or other line of credit to do so, start by pulling your credit reports for free and examining what’s on there.
Be Realistic About Your Bathroom Remodeling Needs
It can be tempting to go a little crazy when presented with so many wonderful features for your bathroom remodel. You might try to stretch your budget to fit in more of the things that catch your imagination in the showroom, or you might even think about what you’d love to have for yourself.
If you intend to stay in your home for a long period of time, that kind of thinking is realistic. But if you intend to sell, it’s important to keep that budget as low as you can, and choose materials and fixtures that have more universal appeal. Consider the ultimate return on investment from the bathroom remodel to ensure it will be worth it in the end. Also, take the time to familiarize yourself with what’s out there, what homeowners are buying, and what you can do to keep up with that market.
A great deal of the success of your bathroom remodel – and staying within that budget! – comes from a trusted contractor. Modernize has helped countless homeowners by connecting them with local contractors who can get the job done and make your bathroom remodel dreams a reality. Let us help you find the right person for the job.