15 NOVEMBER, 2019

From meeting different architects to scrolling through the catalogues of furniture and home accessories, there are so many things to do when you plan to renovate your house. However, managing the funds required for it is still one of the most critical tasks. Now, whether you take a home loan for renovation or using your savings, you may encounter with hidden expenses.

Housing renovation requires a lot of planning in terms of finance and structure of the house. The structural part can be taken care of by the contractor or architect, and you have to handle the finance part. You would not want such hidden costs hampering your home renovation plans. That is why you should be prepared for them from the beginning. The following are 10 hidden costs involved in home renovation that will help you to plan your renovations effectively.

Surprise Structural Changes

This is one of the most frequently reported hidden costs by people. The structures often seem perfectly fine on the surface. But once you start renovating your house, you encounter many faults in them, which makes you spend more money. Sometimes, architects will advise you to make specific structural changes while the renovation is going on. There are even cases where the process of renovation destroys the structures and owners need to rectify it. When you start gathering funds to renovate your house, you should also prepare yourself for such surprise expenses and plan your structure cautiously.

Damage Caused by Pest

Many houses suffer from the attack of termites, which eat up the furniture and important structures from inside. While renovating, homeowners notice this damage, which can be rectified by replacing the furniture.

Modification According to the ‘Code’

Nowadays, building and housing societies design specific ‘Codes’. These are nothing but simple guidelines that protect public health and promote environmental safety. These codes implement energy efficiency and sustainability. There is a chance that despite living in a building for several years, you may not know about these codes in detail. So, when you start renovating your house, the building management people will contact you to follow these codes, which may make you stretch your budget.

Temporary Residence

While your house is being renovated, you need to find temporary accommodation, which adds to your total budget.

Increased Utility Bills

This one is not as such hidden, but many homeowners neglect this one and get a shock at the end of every month. The contractors consume a massive amount of electricity to use their machinery while renovating your house. This, in turn, increases your monthly electricity bill. This is a hidden yet, inevitable type of expense. Therefore you should prepare yourself for this in order to avoid future stress. You can prepare for all renovation costs by taking a home renovation loan.

Managing Your Pets

While renovating your house, you have to provide proper shelter to your pets so that they will not get harmed during the process.

Kitchen Being Unavailable

Eating outside is often a neglected expense by people who are renovating their houses. Depending on the type of work, renovation may last from several days to a couple of years. If the kitchen is unavailable during this time, you have to eat outside, which eventually costs you a lot than you realise.

Delayed Work

There is a high chance of workers delaying work for several reasons. As these workers are paid daily, even a waste of a day increases the total cost.

Wastage of Your Time

During the renovation, many instances will occur where you need to take a day off work to supervise the architect. When you are a business person, this will affect your daily income.

Cost of Moving

You need to vacate your house for renovation. For this, you need to pay the agencies that help you move and transfer your belonging to your new accommodation.

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.