Setting your budget before starting the ADU building process is crucial. As one of the most common ADU mistakes, not setting a budget can cause you to realize halfway through the building process that you can’t actually afford to develop your ADU.
Why A Budget Is Important
Not setting a budget from the start is a common ADU development mistake that can have more negative results than you may think.
For starters, most people assume they can afford an ADU based on average costs, but don’t realize all ADU’s are different. As a result, the ADU your building may be too expensive for you to build. Thus, you could be left with a half built ADU or in more debt than you expected.
Another possibility is that you do have a good grasp of how much the ADU should cost, but since you don’ budget out each singular expense, you could end up acquiring unnecessary costs. As a result, you will overspend on an ADU that could have been built at a more affordable price.
Not Including Everything in Your Budget
Making a budget, but not including all your expenses within it is another one of the most common ADU mistakes to avoid.
When you make your budget, you should be sure to include every cost that will be acquired to ensure you are not blindsided later. Common costs that are often forgotten that you should make sure you have within your budget include:
- City fees
- Rough materials
- Special inspection fees
You should go into great detail breaking down each aspect to ensure you get all the costs associated with it.
A Budget Saves You Time and Money
Setting a budget allows you to see where your expenses are going and identify areas where you may be able to save a little money.
By setting a budget from the start, you will be saving yourself time later down the road if by chance you realize you don’t have the money necessary to complete the project. If this happens, you will be able to quickly identify where you can save yourself money and still be able to complete your ADU project.