How remodeling costs spin out of control

This guest post comes from Len Penzo at Len Penzo dot Com.

 

As I've previously mentioned, the Penzo household is in the middle of a long-awaited home renovation project.

 

Originally, it was supposed to be a fairly modest kitchen renovation that involved replacing our porcelain tile countertops with granite and adding a new tumbled stone backsplash. It also included some new appliances.

• Time to tap the home equity?

Then, one quiet evening not too long ago, while we were watching the 6,000th episode of "House Hunters," the Honeybee decided to see if she could push the budget boundaries just a tad.

 

The Proposition

"The contractor says we'll have enough granite left over to do the powder room countertop too. What do you think?"

 

Maybe it was fatigue, or maybe I was simply distracted, much more interested in whether the happy couple on the television were going to choose the corner-lot fixer-upper or the cul-de-sac cutie. Whatever it was, I really wasn't thinking clearly and the bottom line is that before I could stop myself -- and without the slightest bit of hesitation -- I said, "Go ahead."

 

After all, how much more could it really cost?

 

Besides, in that split second between the time the Honeybee asked whether it was OK and the time I gave my answer, I already did the money math in my head.

•  Check mortgage rates at historic lows

We had already paid for the granite slabs ($2,107.03), and whatever material we didn't end up using was probably going to go to waste anyway being that I didn't feel like storing the excess in my garage. As for the additional labor cost, it couldn't be, well, much more than a very small fraction of the price I was paying for the kitchen labor ($2,675). So why not?

 

Unfortunately, it wasn't quite that simple.

 

I really should have known better. You see, in my line of work we are constantly on guard for something called "requirements creep" because if it isn't controlled, it can quickly send costs so far over the original budget that it can seriously derail a project.

 

Let me show you what I mean.

 

Remodeling costs can escalate

When I innocently told the Honeybee to go ahead, I figured I had signed up for nothing more than a new granite countertop in my powder room for little more than the price of a little additional labor ($300).

 

But that new powder room countertop begot a new sink ($127.03).

 

And the sink begot the new oil-rubbed bronze faucet hardware ($157).

 

Then the oil-rubbed bronze faucet hardware begot the new towel rack ($32.48).

 

Of course, the towel rack begot the new light fixture ($119.98).

 

Then the light fixture begot the new fancy-pancy toilet paper holder ($20.98).

 

The fancy-pancy toilet paper holder begot the new toilet handle ($20.41).

 

And the toilet handle begot the new hand towel holder ($32.48), the new napkin tray ($14.18), the new Kleenex box cover ($29.99 via special order), and the new trash can ($31.99), all in oil-rubbed bronze.

 

Hi-ho, the derry-o, and the Cheese stands alone -- not to mention $586.52 poorer than he originally thought he'd be. Plus tax.

 

Other examples of requirements creep

Requirements creep tends to most often manifest itself in home remodeling projects, but it can also show up in other circumstances. I'm sure you can think of lots of examples, but here are just a few:

• When buying a car. Requirements creep occurs after buyers decide to "go the extra mile" and buy options like satellite radio, heated seats, keyless entry, and leather-trimmed interiors.
• When buying a new home. It is quite common for people to start out looking for a modest three-bed, two-bath home, only to eventually convince themselves that they really need a much bigger home.
• When ordering at a restaurant. How many times do we talk ourselves into "super-sizing" our lunch or dinner, not because we're really famished, but just because it's only an extra 59 cents?
• When buying a new television. I bet most of us know at least one person who threw caution to the wind by going all out and buying one of those monster man-cave televisions that is five sizes too big for the living room it sits in.

I have more examples but, sadly, I'm out of time; the Honeybee needs my services.  Apparently it's time for me to install our brand-new fancy-pancy toilet paper holder.

 

More from Len Penzo cot Com and MSN Money:

• 19 tips for saving a bundle of money on home appliances
• 19 things your millionaire neighbor won't tell you
• 10 key characteristics of debt-free people (of modest means)
• Remodeling? It's a waste of money
• 5 recession-proof remodeling projects
• 6 ways to blow your remodeling budget