Budgeting and Financing Your Build
1. Setting a Realistic Budget
- Personal Finances: Determine your budget based on savings, the value of your current home, or the maximum mortgage amount you can secure.
- Conservative Estimation: Avoid overestimating your financial capacity. Establish a conservative budget to provide a buffer for unexpected costs.
2. Understanding Budget Fluctuations
- Dynamic Nature: Expect your budget to change as design decisions and specifications evolve. Accurate cost predictions can only be made after detailed planning and sourcing.
- Initial Estimates: At the start, use a rough estimate, such as £€/per square meter, but be aware that this can vary widely. A detailed estimate will be provided by a Quantity Surveyor (QS) once you have finalized plans and specifications.
3. Contingency Planning
- Contingency Fund: Always reserve a portion of your budget for unforeseen issues, such as unexpected ground conditions or other changes.
- Flexibility: Be prepared to adjust your plans if necessary. Consider less expensive alternatives for fixtures and finishes to stay within budget.
4. Managing Unexpected Costs
- Adjustments: If you encounter cost overruns, be prepared to delay non-essential aspects, such as landscaping or final touches. Some self-builders may need to use temporary solutions like second-hand kitchens or unfinished floors.
5. Financing Considerations
- Early Consultation: Speak with your bank or building society early in the process to understand their requirements and mortgage options.
- Regional Differences: Be aware of differences between regions, such as Northern Ireland (NI) and the Republic of Ireland (ROI). Some banks may have stricter lending criteria, including concerns about non-traditional building methods or shared road access.
- Property Resale: Lenders consider how easily they can sell the property if you default on the mortgage. Ensure that your build meets their standards and is attractive to future buyers