dream design

When a dream design becomes a real-life nightmare

 

Let me tell you a story. It’s a cautionary tale and one you should pay attention to if you’re thinking about a renovation. Especially a big renovation. 

 

Once upon a time, we were watching Grand Designs (well, just the other night) when we suddenly realised the featured house was currently for sale, in fact, my sister had pointed it out to me a couple of months ago. You see, in addition to cooking, sewing and reading my other hobby is looking at real estate – usually in Hobart, where we have vague dreams of retiring one day. One of my sisters lives down there and she occasionally flicks me houses I might be interested in. This one was listed at $5million plus, putting it not only in “total fantasy” territory for us but also at the top of the range for Tasmanian real estate in general.

 

The house in question is in Battery Point, a lovely historic district of Hobart, right on the waterfront and it incorporates a brutally modern extension with an original timber cottage. On Grand Designs the owner admitted that the original budget of $1.6m had been left in the dust and that the total project cost was far greater than that and that he’d probably be paying for it for the next ten years. Gulp.

 

The next day, I saw this feature in the newspaper and my heart broke. It turns out that this renovation cost so much that the owners can no longer afford to live there. They’ve had it on the market for more than two years and are renting out the front bedroom for $350 a night as luxury accommodation. It’s an absolutely stunning house, no question, but for me, it seems that the price was too high – both financially and emotionally. As the Grand Designs episode wrap-up says, there were council restrictions and challenging building conditions. Add to that an architect given free reign, contracts done on a handshake, and Greg’s insistence on quality, and you have a schedule blow-out with a budget spinning out of control.

 

Unfortunately, it’s a situation that’s far too common. A home-owner falls in love with an architectural design and plunges in without a real understanding of the costs involved. Because they love the design so much, they’ll often go with the builder who gives them the cheapest quote without questioning why it’s so much lower than the others. They begin building and by the time it’s finished they’ve paid anywhere between 50% and 100% more than the original estimate. #realtalk

 

Best case scenario is that they get a trustworthy, knowledgeable builder, like JD, involved at an early enough stage that they can make design changes to accommodate their budget. He’s great at working with customers to make sure that their design wants and needs are aligned with their budget. A good builder will help you find solutions to design and budget issues. After all it’s much easier to make new lines on paper than it is to move built walls or get more money from the bank. In some cases we’ve seen people go all the way down the design and approval track (without consulting a builder along the way) and only then realise that they can’t afford it and so they decide to sell the house instead – having spent $30,000 – $40,000 along the way. Which is great for the designer and the real estate agent, but not so great for the home-owner.

 

There’s no denying that this Battery Point house is architecturally impressive and I’m sure it’s been well built but it’s just so sad that this couple’s retirement dream is now having to take a new direction due to the cost and scope of the project they decided to embark on.

 

Have you embarked on a renovation project and then put the brakes on? What advice would you offer to this couple? Where would you like to retire to?

Linking up with Essentially Jess for IBOT

18 Comments

  • Betty

    Oh dear!

    The Doc and I have just started looking at a possible reno/flip scenario and have enlisted some advice from an expert fit this exact reason. I have such grandiose ideas sometimes and I need a good talking to to bring me down from the rafters.

    I think I needed to read this today. Thank YOU!

    • alix@thebuilderette.com

      Hi Betty, thanks for visiting and I’m so glad to hear that this post has helped you today. It’s just so important to get a realistic view and cost of things before you start. Once you’re halfway through it’s very expensive to change course. I hope your reno goes well! Cheers.

  • shannon @my2morrows

    Wow. That is really scary but I can see how it happens. Were thinking if a major reno so good to keep this in mind. X

  • Sarah

    Yes, we always tell our friends with a renovations, always expect atleast another 30% on top of what you think, for unexpected costs.

    • alix@thebuilderette.com

      Hi Sarah. Yes, unfortunately it’s the nature of the beast that unexpected costs will crop up.

  • Amelia Lee

    Hi Alix,
    Unfortunately not the first time I’ve heard this happening!
    Your home is usually your biggest asset, so every investment in it should make financial sense.
    However, when your heart is tied so heavily to the outcome, it can be tricky to stay rational and objective about your budget and spending money on it.
    Great post – thanks for sharing!

    • alix@thebuilderette.com

      Thanks Amelia – yes, it’s far too common and so heartbreaking. Yet avoidable! Cheers, alix

  • Cathy@lifethroughthehaze

    We have a small ex housing comm house in the Northern Suburbs of Wollongong. What we paid and what it will sell for even now in a relatively unrenovated state are just ridiculous. That said we did a small reno adding a big covered deck across the back and converted the old back porch into a second bathroom that also houses our washing machine.

    Before I had drawings done or anything like that I contacted a couple of builders to have the conversation with them about structural walls and approximate costs and if what I wanted to do was even doable. This was two fold one to have a rough idea of cost as you said no point falling in love with a design to discover that it was 3x the budget we have and to find out if what I wanted to do was actually doable! Our old porch was a solid concrete slab which was fine I knew for building a bathroom on but what condition was the concrete in and how would the plumbing go int etc.

    I would love to do more here but I do think that at some point we would over capitalise. Though a new bathroom (main one) and a new kitchen including floors would be heaven!

    • alix@thebuilderette.com

      Hi Cathy – sounds like you did the right thing up front. If you’re planning to stay there for a long time, I’d go ahead and get that new kitchen and bathroom – for you to enjoy and also both of those renos will add value to a house. Cheers.

  • Michelle Earnshaw

    One of my all time favourite Grand Designs episodes was about a bloke who dreamed of having a castle. He bought a ruin and rebuilt it (some of which collapsed while they were filming). When he finished they couldn’t afford to live there as the heating bill alone was £8000 a year because the stone was so cold. He couldnt bear to let it go so they turned it into a bed’n’breakfast & spent their time waiting on the guests & letting them have all the best rooms. It was magnificent but i dont think achieving his deeam bought him the happiness or comfort he expected.

    • alix@thebuilderette.com

      Hi Michelle – yes, I’m sure that was not the dream! And could have been avoided by some rigorous pre-planning. Working out your heating bill ahead of time might not be as fun as choosing finishes for the kitchen, but turns out it was important!

  • Michelle - Jarrah Jungle

    It all comes down to budget, we have renovated our home room by room and set a price for each before we start so then we can work out what we need and how much it will cost and what we can spend more on and what to save on. I have a spreadsheet with tabs for every room to keep the costs in check and this has worked really well for us over the 7 years we’ve been renovating!

    • alix@thebuilderette.com

      Hi Michelle – sounds like you’ve worked out a great system and stuck to it – well done! It takes some discipline, doesn’t it? Cheers.

  • Nicole @ The Builder's Wife

    I too have heard this story before, it must come as such a disappointment to the owners. I feel fortunate to be in a position where I have the builders advice well before we reach the planning stage, that said my dreams tend to be a little stilted, though he would call the realistic 🙂

  • Toni {Finding Myself Young}

    We’ve been discussing whether to buy an old house and renovate or just build our next house from scratch. We’ve come to the decision that we’ll just stay in our house a little bit longer until we can afford to build the house we want. In all honesty I think if we bought one to renovate it would never get done or would cost a hell of a lot more than we budget for. #teamIBOT

    • alix@thebuilderette.com

      Hi toni

      Thanks for visiting! Definitely a good plan to get all your ducks in a row before you start – it’s a big undertaking. Best of luck with it all.

      cheers.

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