Kitchen renovations are one of the most popular home improvement projects. A beautiful, functional kitchen can transform your home and significantly increase its value. However, kitchen remodels are also notoriously prone to going over budget. Even with careful planning, unexpected costs can add up quickly.
As experienced kitchen remodeling professionals, we have seen many kitchen renovation projects exceed their budget. In this article, we will explain the 8 most common reasons kitchen remodels go over budget. Understanding the key factors that impact costs can help homeowners plan and budget more effectively.
Hidden Structural and System Issues
Opening up walls and floors as part of a kitchen renovation often reveals problems that were not visible initially. Structural issues like deteriorated load-bearing walls, improper framing, or rotten subfloors can require major repairs. Outdated electrical, plumbing, HVAC, or ventilation systems may also need upgrading to support new kitchen layouts and appliances. Addressing these hidden structural and system issues can add thousands of dollars in unforeseen costs.
Carefully inspecting the kitchen prior to finalizing designs can uncover some problems, but deceptive surface finishes can disguise the true condition. Unless walls and floors are opened up, extensive structural or system repairs are often uncovered only after the renovation begins, when it is too late to change plans.
Tips for Avoiding Hidden Issue Cost Overruns:
- Thoroughly examine the existing kitchen conditions prior to designing, including assessing all systems.
- Open up walls in areas that will be impacted by layout changes to uncover any hidden problems early.
- Have qualified contractors inspect load-bearing elements, electrical, plumbing, HVAC, and ventilation systems and provide repair estimates.
- Plan and budget for some contingency funds to cover potential structural and system issue repairs.
Kitchen Layout Changes and Additions
Changing the layout of a kitchen design or adding spaces like an island or bump out area can have a cascading impact on cabinets, countertops, flooring, lighting, and more. Even small adjustments to the kitchen footprint could require moving appliances and plumbing. Kitchen additions also increase costs for heating, cooling, wiring, and ventilation of the larger space.
All of these layout changes and additions generate unexpected costs over and above the direct price of the new cabinets, counters, and flooring being installed. Homeowners often focus too narrowly on the visible improvements and overlook the related changes needed to support them.
Tips for Controlling Costs with Layout Changes:
- Carefully evaluate how each layout change impacts other systems before finalizing designs.
- Limit layout changes to reduce unintended costs, potentially phasing larger changes over time.
- Get contractor input on the full scope of work needed for any layout changes or additions under consideration.
- Add a buffer to budgets to account for ancillary work related to layout modifications.
Choosing Premium Materials and Finishes
Homeowners undertaking kitchen remodels often upgrade from standard materials and finishes to premium options, driving costs upward. This may involve moving from laminate countertops to natural stone, stock cabinets to custom, vinyl flooring to hardwood, or regular appliances to professional-grade models. Even small finish upgrades like adding a decorative tile backsplash or crown molding can add up quickly.
These types of upgrades look beautiful and add real value, however the costs are often underestimated. Premium materials and finishes can increase total project costs by 25% or more over initial budgets.
Tips for Managing Luxury Upgrade Costs:
- Clearly define budgets for each material/finish category before selecting options.
- Research costs of upgrades being considered and weigh the impact on total budget.
- Analyze resale value recovery from potential upgrades to guide choices.
- Limit selections to your most important one or two “wow” upgrades.
- Consider phasing in some upgrades over multiple projects to spread costs over time.
Even with thorough upfront planning, some homeowners still change their mind on materials, finishes, or even layout after the renovation is underway. Change orders mid-project tend to increase costs through purchase of new items and delays. If special ordered items are already purchased or installed, they may also be wasted.
Some changes can’t be avoided if problems are uncovered during the renovation work, but discretionary changes of mind are better minimized. Indecisiveness can be very expensive.
Tips for Reducing Mid-Project Changes:
- Finalize all selections before work start, ideally with written sign-offs.
- Limit number of change orders as much as possible, understand added costs.
- Cover any wasted special order item costs caused by changes.
- Carefully evaluate need for any changes – don’t make for minor preferences.
- Recognize that changes means your total costs will exceed budget.
Unexpected Repairs and Renovation Scope Creep
Even in a mostly cosmetic kitchen refresh, issues can emerge that expand the scope of work required. Plumbing or electrical repairs may be needed. New flooring could require subfloor work or installation upgrades. Wall prep and painting often exceeds expectations. Countertop installations may reveal cabinets that need shimming or reinforcement.
This “scope creep” during the renovation process can balloon project costs. Contractors may also legitimately charge more for unexpected work that could not be anticipated accurately in initial estimates.
Tips for Limiting Expanding Scope:
- Build a contingency fund into budgets to allow for some unexpected issues.
- Closely review what is included in contractor estimates/bids to avoid assumptions.
- Verify who is responsible for any required repairs uncovered during work.
- Where feasible, have contractors incrementally complete limited phases.
- Carefully consider the full scope of work before authorizing repairs or additions.
Delays Extend Project Timeline
Kitchen remodel projects often take significantly longer than homeowners expect. Delays may arise from problems uncovered, change orders, slow contractor work, or unreliable sub-contractors. Having a kitchen unusable for weeks or months puts strain on households. Extended construction time also typically means higher costs for labor, warehousing of purchases, and possibly more homeowner eating out.
In addition, the longer the renovation drags on, the more impact it has on overall lifestyle. This can motivate people to expand the project further or upgrade finishes, driving up costs more.
Tips for Minimizing Project Delays:
- Build extra time into initial renovation schedule estimates, at least 25 percent.
- Confirm contractor has reserved enough time for your project before hiring.
- Verify contractor commitment to sequence work efficiently from start to finish.
- Pin down all product/material selections early to avoid delays.
- Have ready access to funds for unexpected expenses that occur to keep project moving.
- Be prepared to live through a process that may take considerably longer than you expect.
Poor Contractor and Sub-Contractor Management
Hiring unreliable or unqualified contractors is one of the biggest drivers of kitchen renovation cost overruns. Skilled project management is required to deliver renovations on time and on budget. When contractors fail to properly sequence work, manage subs, communicate about problems, or show up on schedule, costs inevitably rise.
Poor contractor management can also lead to quality issues that require fixes or upgrades further increasing project costs. Many homeowners do not carefully vet contractors or confirm project management skills before hiring.
Tips for Controlling Contractor-Related Costs:
- Rigorously check contractor qualifications, experience, reliability and communicate clearly.
- Verify references from other customers for any contractor before hiring.
- Ensure contractor will be onsite directing project from start to finish.
- Confirm contingency plans for reliable back-up sub-contractors if needed.
- Closely monitor contractor performance regarding budgets and schedules.
- Threaten to terminate contractors who repeatedly miss budgets or deadlines.
Unexpected Building Code Upgrades
Local building codes may require unanticipated work related to plumbing, electrical, ventilation, accessibility, fire safety or other issues. For example, if the remodel impacts room egress paths, door widths may need to be changed to meet fire codes. Or if new lighting fixtures significantly increase wattage, electrical system upgrades could be mandated.
These kinds of building code requirements often go unnoticed in initial planning stages. But failure to complete any required upgrades during the course of the renovation could prevent obtaining final permits and approvals for the project. Unexpected building code costs also derail budgets.
Tips for Avoiding Costly Code Upgrades:
- Consult local building department early about any code requirements impacted by designs.
- Build cost of any required upgrades into budgets prior to starting work.
- If possible, plan designs carefully to avoid triggering major code upgrades.
- Ensure required permits are secured ahead of starting any work.
- Recognize that existing kitchens likely won’t fully meet current codes and budget accordingly.
Completing a kitchen renovation project within the established budget requires careful planning, execution, and cost management. The eight factors we outline above cause most kitchen remodeling budgets to be exceeded. Being aware of these key trouble spots provides homeowners with needed insights to avoid cost overruns. Attention to hidden structural issues, scope creep, contractor management, and code upgrades goes a long way toward controlling expenses.
With diligent planning and discipline around containing upgrade costs and change orders, your dream kitchen makeover is still achievable on budget. Just recognize many homeowners ultimately go over budget, and rigorously guard against the factors listed here if you want to beat the odds. With persistent oversight of projects costs and schedules, you can be the exception who completes this investment in lasting value without breaking the bank.
Frequently Asked Questions
Q: What are the main reasons kitchen remodels go over budget?
The 8 most common reasons kitchen remodels exceed planned budgets are:
- Hidden structural and system issues
- Kitchen layout changes and additions
- Choosing premium materials and finishes
- Making changes mid-project
- Unexpected repairs and project scope creep
- Delays that extend the project timeline
- Poor contractor and sub-contractor management
- Unexpected building code upgrades
Q: How much contingency should I add to the budget for a kitchen remodel?
You should add at least 10-15% contingency to your initial budget estimate for a kitchen remodel, and potentially as much as 25%. Kitchen remodels frequently involve many unknowns until demolition and construction work begins. The contingency covers unexpected repairs, changes, delays, and other cost overruns.
Q: What is the biggest cause of kitchen renovation budget overruns?
Poor contractor and sub-contractor management tends to be the number one driver of kitchen remodeling budget overages. Unreliable contractors often provide inaccurate estimates, fail to properly sequence work, create delays, make mistakes requiring rework, and manage subs poorly. Thoroughly vetting contractors is critical.
Q: How can I avoid expensive change orders during my kitchen remodel?
You can minimize costly change orders by:
- Finalizing all design selections upfront before work begins
- Limiting number of changes to essential items only
- Getting written change order costs from contractor before approving
- Sticking with initial design except for unavoidable issues
Q: Should I get a home equity loan as backup budget for my kitchen remodel?
Having access to additional funds via a home equity line of credit is a smart idea to provide a buffer in case the kitchen project expenses exceed your savings. The ability to withdraw needed amounts smoothly can help avoid work delays. Just be careful and disciplined about borrowing only what is absolutely necessary.
Q: How can I prevent delays from making my kitchen renovation go over budget?
To help prevent delays:
- Build extra time allowances into the initial schedule
- Finalize all selections early to avoid work slowdowns
- Closely oversee contractor performance day-to-day
- Have back-up sub-contractor options if needed
- Seek incremental completion and payments for each project phase