Jennifer Skingley and her partner knew what they wanted in a new home.

But finding a well-located GTA property that checked off all of their boxes was near impossible, given their budget. So, they settled for something a little less ‘turnkey’ and opted to renovate.

It’s a path that appeals to many Canadians, with results from the annual CIBC Home Renovations Poll showing that almost 50% of Canadian homeowners are planning to renovate this year.

READ: Toronto Couple Takes On Full Home Reno And Documents It On Instagram

But if home renovation is such a go-to solution, why is it so replete with problems?

Skingley and her partner were organized with their planning and certain of their budget and design goals. And while the couple was ultimately thrilled with the results of their bathroom and basement fixes, the experience was incredibly frustrating.

Image1 The stunning results of Jennifer Skingley's renovated bathroom.

“Our contractor said all the right things in advance,” recalls Skingley. “But clearly we weren’t a priority. As soon as work was set to begin, people suddenly couldn’t commit or would disappear. We had to be on-site if we wanted to anything to progress, and the project still ended up many thousands of dollars over budget.”

This is not uncommon in our city. Reno horror stories abound, with projects rarely coming in under budget and on time.

“You can only plan to a certain point”, says Harvey Minuk, of First Place Capital. First Place has been a go-to contractor in Toronto for over two decades. And though Minuk and his team enjoy a stellar reputation, he understands where things can go wrong on a renovation.

“A renovator has to deal with tying new to old,” says Minuk. “We have to figure out how to make everything work together, so that it seems like a new build. This is a puzzle that requires an experienced team of professionals.”

READ: This Toronto Listing Was Reno’d On HGTV And Only Costs $798,000!

With so many moving parts and unforeseen issues, it is paramount that a client have their finances in order before even meeting with a contractor. And Karlee Vukets, Managing Director and Associate Advisor at Vukets and Associates, suggests that a client always plan financially for the unexpected.

According to Vukets, a good contractor should be able to say how much extra you should reserve.

“There are always unforeseen delays and problems with a project like this,” says Vukets. “Depending on your budget, I suggest a 10% variance be set aside – but be sure to challenge your contractor on that.”

That is certainly sound advice. But for many homeowners, understanding how and when you can afford to renovate can be confusing.

READ: HGTV’s Bryan Baeumler Tells You The Home Reno Projects That Pay for Themselves

Vukets suggests that clients outline their bills and their savings to see what is left over in a month.  If the client is able to survive on the amount left over, month over month, then they may be in a good place to take on a reno project.

“People are generally okay sacrificing their lifestyle for a maximum of three years to achieve those short-term goals,” explains Vukets. “But if a project is going to make things tight for five years and beyond, it’s probably best to wait.”

Image2 Before bathroom renos began, Skingsley and her partner had all of their budgeting in order.

Casper Wong, COO of Financeit, believes that, depending on one’s financial situation, there are benefits to financing a home renovation.

Wong suggests that using an installment loan for these types of projects allows for financial predictability and a way to manage budgets, particularly if a renovation is unplanned. Going this route would allow someone to take advantage of any promotional offers from merchants, including low interest rates or payment deferrals.

A platform like Financeit also tends to take some of the hassle and delay out of the loan application process.

“At Financeit, we offer instant credit decisions,” says Wong. “It’s simple and fast. We offer an instant credit approval and our entire process is seamless with no paper involved. Plus, our payroll calculator allows you to calculate your monthly payments based on the loan amount, repayment period and interest rate.”

READ: Should I Renovate, Remortgage, Replace Or Relocate?

Smart financial planning certainly helps to avoid some of the pitfalls of home renovation.  But as Jennifer Skingley and her partner found out, the risks with renovating run deeper.

“It’s about expectations, communication and understanding,” says Minuk. “There are limitations when dealing with old houses and previous renovations. The client and the renovator have to constantly work the budget and be prepared for outside forces that can impact the budget anytime. Understanding what you truly need over what you want helps make decision making efficient and practical.”

Personal Finance