One of the most important factors while planning to build your dream home is the cost involved. We also need to budget it well to ensure that we end up completing the construction as envisioned. Sadly, most of us fail in this and end up cutting costs towards the end and compromise on the finishing items. Many more times we overshoot the budget by unexpected amounts and stressed out in finding solutions.
So, what should be the ideal cost of the house you plan to build and how to budget it properly. Let’s face it, we are not financial experts and most of us are not really that good with budgeting. House wives are pretty good at managing the monthly budget, yet they too get stressed out with unforeseen expenses, while they tried to cover all possible scenarios.
Construction on the other hand is a very complex program or project with lots of unknowns, let alone the fluctuations in the cost of material. We do ask our friends or family who have already gone through this experience, yet there still remains a lot of grey areas.
Is there a way out?
Yes, its not rocket science but obviously needs lot of learning, attention and discipline.
Will it not be a dream that after you have completed construction of your dream home as per your requirements, you still had enough budget left to open the champagne for the house warming?
Let’s make this dream a reality!
Few of the guidelines mentioned below will help you in constructing your dream home and live your dream;
1. Be Realistic: Let’s be practical, money doesn’t grow on trees and we need to plan and spend it well. If you have a vision of allocating a budget of let’s say Rs. 30.0 Lakhs and you know you can surely get this amount, first step is GET IT. Only once you are sure you have this amount within your bank or clear and realistic possibility of getting it within next 3 – 6 months, do not think of even starting your Dream Home Construction.
2. Reduce Budget: Deduct 10% of your realistic budget, let’s say you have Rs. 30.0 Lakhs in your account and you are ready to start construction, reduce your budget by 10% and make it Rs. 27.0 Lakhs.
3. Fixed Deposit: Use various methods and instruments to secure your funds on monthly basis, example use bank’s fixed deposit methods to FD your funds in the following manner:
a. 50% for 6 months
b. 25% for 3 months
This will help you to manage the inflation to some extent.
4. Take Professional Help: Don’t be penny wise and pound foolish. Approach a professional, an Architect or an Engineer to help you Design and Budget your dream home. Architects & Engineers will help you plan your house with the budget you mention to them, yes they will charge their professional fees, but rest assured the amount given for Professional Help is not spent extra.
5. Japanese Way: Take time in planning, don’t rush into construction immediately. Spend as much time in Design, Specifications and Detailing as possible. Discuss as much as possible with every person who is going to live in that house, visit all possible vendors, select your flooring, select your toilet tiles, select your kitchen, your paint, your doors & windows, etc. and take their quotes and add it to your budget. Ensure that all decisions are taken before ground breaking. I know we always feel that we’ll plan as we go, trust me, its not the way for people who wish to enjoy that champagne after construction. There are views that some new material or some new design or some extra discounts may shift your focus from taking the decision, well I strongly advice against it. Don’t get carried away with future possibilities. Ensure that all that you dream of being a part of your dream home is thought of, cost included with Professional Help, planned, discussed and finalized.
6. Contractor: Take time in understanding the labor contractor or contractor’s costs and ensure that all that is promised by the contractor is clearly written and understood by both parties with the help of Professional Architect or Engineer. Try and check that there are no grey areas left. Negotiate with the contractor on time lines and quality rather than the cost, if you find that the cost is as per market rates. Many times the contractor will quote lower prices to get the work, but will employ unskilled manpower that will either waste your precious material or waste your money in redoing the work.
7. Ground Breaking: Now, once every thing is set, it’s time to start the construction of your dream home.
8. Discipline: Ensure that you do not succumb to Design Changes or additional space creations or new suggestions that may come from various so called well wishers. They really do mean well, but do not understand the complexity of change and costs. It may appear that its adding just Rs. 10,000.0 but trust me, it will be much more than that. So, if you have really done your homework and really spent lot of time in planning, give credence to the time spent and do not allow any changes.
9. The Cheap Myth: Its a myth that somethings can be done cheaper, yes they can surely be done at a lower cost by adjusting either the material consumption or quality. A labor charging Rs. 500.0 per day will not reduce his amount that he deserves neither will he increase or improve his work. A material that costs a certain amount cannot be cheaper. To make cost effective homes with quality and less future maintenance, the only and the only way is to reduce your area of construction.
10. Finishing is Important: Final Finishing, including the final paint or the lock on your front door as as important as the foundation of your home. If you have stuck to your plan and constantly taking Professional Guidance from your Architect or Engineer, you will definitely finish your dream home with a dream House Warming.
HouZone can help you plan, budget and guide you through your entire process of building your dream home. Whether your budget is Rs. 10.0 Lakhs or Rs. 100.0 Lakhs, we will take the stress out of house building, so you can enjoy your dream.