Overstretching on building works.. a good/bad idea?

[belhamwalk]

Hi all, we are just about to embark on a massive renovation.... side, back and loft extensions... trouble is the builder wants oooh.. 25K more than we have to do the works. We will be able to 'find' the money but it would mean borrowing 10K from my parents, selling some equipment my husband has and maxing out a 7K 0% interest (for 30 months!) credit card. Are we crazy? Or should we just go for it? It would leave us with an incredible house at the end of it all but will we regret overstretching?
TIA. xxxx

If you're talking about maxing out a credit card to pay just the first quote, I'd be uncomfortable with that personally. What if they find the joists are all rotten and it ends up costing more? What's your contingency plan?

Yep the bigger the build the more problems you will find. You will need a pot of money when things go wrong , and they will , what will you do ? Live in a building site while you get the money together . I would scale back the plans.

Definitely scale back or get other quotes. Finishing off eg new kitchen carpets fittings etc will add to so much more.

We had a teeny extension built but we still had a 10% contingency fund.

Our foundations were deeper than expected which left a "room" under the extension (raft foundation due to sloping site) and we had tank it like a basement and pour 9 tonne of hardcore into room. So this cost more in materials and labour because it was unforeseen.

My house was 15 years old when we did the extension (we have also converted a double garage so have experience of 2 builds.) If your house is older then there could be a whole host of issues.

You need to prioritise what is the most important to you and do that and hold off on the other one until you can afford it.

The last thing you will want to do is compromise all the way through because you couldn't afford what you wanted. Costs can spiral fast.

First of all, you WILL need a contingency and you should plan this as if you are going to spend it not as something hypothetical. I don't know of many builds that haven't found something unexpected that has pushed up the budget.

Second of all, what does the builder's quote include? Is it first or second fix? Have all costs for finishes been included? These could effectively double the cost if not.

I really, really wouldn't push yourselves that hard. Maybe leave the loft extension to another time when you are financially more secure.

Surely the first question should be why has the builder changed his quote to add on an 25k extra ? Is it substantiated - i.e have you changed the brief or the design to justify it or he is trying his luck?

Don't do it! We're nearing the end of a large extension. You go over budget and need a contingency. Wait a year and save the money. It's stressful enough without money worries

We're about to embark on a refurb, although not as extensive as yours. There's no way we'd do it without having the money to cover everything, plus the 10%, because the stress of accruing all that debt, plus more, would seriously take the shine off it and I don't want to end up with cheap fixtures and fittings because we've had to skimp. Do you really need to do the loft now? Unless it's absolutely crucial, I'd leave that until you have the full funds.

I agree. We didn't go over budget on the build cost but the associated costs (of furnishings / decorating it / kitchen & bathrooms) were much more than we anticipated. Also, think about the knock on effect of the build (for example our back garden was pretty much trashed, practically every other room / space in the house was affected so needed all those decorating / replaced some flooring) and then extras you want as you go along (you have lived in a building site for so long that whilst you may have thought you would have waited / saved for the exact finish you want etc, you just want it all finished!).

No, don't do it! Either scale back or delay to save up more funds. You will go over - especially with the 2nd fix. There will be unforeseen extra costs and unless you have specified the finish to the nth degree, you will have underestimated the 2nd fix costs. If you're already stretching to cover the build costs & 1st fix costs, don't do it!
Also, set aside something for the garden/patio/drive - you really don't want to live with a muddy plot for long so you might as well do the ground works at the same time.

I never thought about upgrading my internal doors/door furniture, changing all my 70's radiators, having better coving and architrave, chrome LED downlights, sockets & switches. Just a door upgrade may cost an extra £50 but when you have 20+ of them to purchase and that's just for one item. It all adds up.....

And I thought that I had a healthy budget with a contingency - I had 3 bathrooms plus a cloakroom to kit out - so any thoughts of Laufen sanitaryware and Matki showers had to be downgraded to Roca & Hansgrohe. And then, there were the patio slabs which disguised the manhole covers for £150 each - had 2 of those. Who would anticipate those at the start of a build? Btw, I still went over by 20% - made the decision to buy Ikea kitchen units easier since we could buy those on 3 yrs free credit!

The quote has not changed. The OP just does not have the money. Building works are always more than the quote! Tidying up and other costs are never included. Scale back.

Hansgrohe is hardly a downgrade though! I love their taps and they are very well built and stylish!

It's all relative isn't it? Hansgrohe stuff is great - I mean, I can't imagine anyone reasonable complaining about it - but it's a downgrade from Matki, which is a downgrade from Crosswater, which will be a downgrade from something else. You can pay the earth for just about anything these days. I'm constantly amazed at the ridiculous prices in Elle Decor - £25,000 for a bath, FFS. And that's the problem with second fix, right there - costs can just spiral upwards if you aren't careful.

Hello OP... sounds like my current build is along the same lines (new 3rd floor, double-height extension to side and single-storey extension across the back).

I'd strongly suggest waiting a bit longer & saving what you need, plus at least a 10% contingency fund. The older your house, the more likely it is that unexpected issues will crop up.

There was an issue with the quality of the ground in the first week of my build and the cost of the foundations jumped from £3k to £9k overnight (the building inspector insisted on a steel 'raft' plus additional concrete).

I completely agree with the other posters that such a large amount of work is stressful enough without added financial pressure.

Good luck

Scale back Op.

Put simply, you can’t afford what you want.

You might be able to borrow more money against the house part way through the build. If you did the loft conversion first for example, if the extra bedrooms increased the value of your home then, assuming you are currently limited by the LTV, you'll be able to increase your loan in line with the increased value.

We had a 40% contingency and have pretty much spent all of it (old house, unexpected stuff plus we splashed out a bit more than planned on a few things). You absolutely should not start with less than you need - recipe for disaster and major stress!

I definitely wouldn’t max everything out just for the actual build you’ll spend more than you think. You’d need to get other quotes or knock him down. We spent way over what we estimated.

No you’d be mad to start off, already having maxing out a credit card.

You WILL need a contingency fund.