Renovation Reality Check

Between HGTV, lifestyle blogs, and endless YouTube tutorials, it feels like the whole world wants homeowners to pick up a sledgehammer and start knocking down their interior walls. While DIY culture has led to some gorgeous, money-saving projects, it has also inflated expectations of what large-scale feats people can reasonably do themselves.

Let’s face it: some of us are handier than others. Those blessed with green thumbs can save on landscaping costs, while others with steady hands can save on labor for fresh coats of paint. But when it comes to larger projects, such as replacing kitchen cabinetry, some HGTV devotees have flashbacks to their high school shop class and think, “I can do that!”

But when you fast forward two months, there are unfinished edges and uneven measurements everywhere, and they have sunk more money into the project than they would’ve if they’d hired a professional to begin with. Certain jobs require so many tools that purchasing them all would add up to more than the costs of professional labor, while others are simply too dangerous to be attempted on your own.

First-time homebuyers can be easily tempted into visualizing what a home CAN be rather than what it IS. This is sometimes beneficial; compromising your “must-haves” is a good way to afford more home in a preferable area, and there are novice-friendly, small-scale renovations that can freshen up any room at a low cost. In fact, creating little projects for yourself around the house is a good way to learn new things, feel productive, and bond with the family.

However, when it comes to a home you’ve just purchased, you should ideally not have three pages’ worth of renovations you insist on making. When you apply for a home loan, one major factor lenders take into consideration is your debt-to-income ratio, or DTI. This is a measurement of your income against your monthly expenses. If all of your planned home renovation projects threaten to increase those monthly expenses significantly, this can put you in a potentially uncomfortable financial scenario that was not accurately represented when you initially qualified.  

To get ahead of these issues, discuss renovations with your Realtor and the financial implications with your lender on any properties you consider purchasing. They will work with you to paint a realistic picture, providing you with referrals and estimates for professionals if necessary.