How to Budget Your Dream Home: Tools and Tips

It’s everyone’s dream to own a place that they can truly call their own. That said, a lack of proper financial forethought and backing can keep that dream from fully being realized.

Furthermore, the average housing prices continue to rise with time, and this growth often far exceeds the annual salary of a typical professional in Australia and across the globe.

With all these factors in play, it can be tough gathering enough funds to make your dream house —or simply any house—a reality.

However, don’t be disheartened. With the proper mindset and financial planning, as well as the right tools and strategies, it’s possible to build a dream house in a couple of years.

If you’re eager to know the ways to set aside a budget for your dream house, look no further. Here’s a guide on how to budget for your dream home.

1) Factor in Your Location

The plot of land you choose to build your house plays a crucial role in your home’s final cost. Most plots in suburban areas far from the city center typically have a more budget-friendly cost breakdown, while centralized locations tend to cost significantly more.

If the focus of your dream house is its aesthetic qualities and size, then it might be in your best interest to choose a location far from high-traffic areas. This can make your project more approachable for the budget.

Conversely, if you don’t mind a smaller plot of land and can conceptualize a dream house in a more restricted space, then you can most probably afford to stay closer to the city. This decision is especially useful if you don’t own a family vehicle and rely on public transportation for mobility.

Besides proximity to city centers, the location you pick also influences your safety and proximity to amenities. Some neighborhoods are safer than others, and some places can be a good 20 minutes (or more) to the nearest supermarket or school. Factor these in before hastily picking a cheap-looking plot of land to set up your home.

2) Know a Budget Range

Building a home entails a tonne of variable costs, from construction materials to labor services. No single building project has a fixed cost, and many miscellaneous fees can accrue suddenly and over time.

Despite the high variance of these housing costs, you need to set up a reasonable budget plan before undertaking the dream house project. It’s essential to keep track of these expenses and ensure that they fit within a reasonable budget plan.

3) Conceptualize a Floor Plan

After you’ve settled your budget and location, your next move should be determining your new home’s specific features.

How many bathrooms and bedrooms do you want? How big should the kitchen be? Is there going to be a backyard, a porch, or both? How do you envision the arrangement of your furniture? The answers to these questions should be cleared up in your home’s floor plan.

This decision is personal. While you can come up with design ideas yourself, you can also get ideas from other sources like interior design magazines, local showrooms, or even image boards like Pinterest.

Above all else, never forget that the floor plan also hinges on your actual budget. As such, be sure to keep your wishes realistic.

4) Hire the Right People

Even if it’s not your first time managing a house-building project, it’s essential to get experts in the trade involved in your dream house construction.

The critical people you need to consult are a structural engineer, an architect, and an interior designer. These people possess the necessary skills in helping you design a home that has all the qualities that make it safe, beautiful, and livable.

In addition, hiring a lawyer and real estate agent (or paying a fee for their services) can also be considered for helping you secure good deals. They also bring some legitimacy to your house-building project and ensure that you won’t fall on any bad deal.

While hiring any licensed professional can help you secure a house, hiring good ones can mean the difference between saving you from costly mistakes or leading you to multiple four-figure problems.

As such, be sure to vet who you choose to partner with thoroughly and ensure that their skills are up to par and align with your overall vision.

5) Acquire the Right Materials

While you can definitely go the cost-effective route and choose inexpensive and “good-enough” materials, this is your dream house we’re talking about.

Skimping on passable materials for the sake of better savings can leave you dissatisfied with the project—and you can dwell in this disappointment for years on end, literally.

And if you decide to undergo further renovations in the future, you may as well have used quality materials to begin with. As such, right from the start, consider getting quality materials right from the start for your dream home.

From quality wood tiling to marble countertops, the right materials can be a crucial element to make your home’s aesthetics truly pop out. They also so happen to be one of the major costs of a home building project, so plan your timeline accordingly.

6) Consider Loaning and Alternative Financing Options

Not everyone will have the savings to pay the total price of a home from the get-go. Fortunately, you don’t have to have these finances on hand immediately.

Mortgages, home loans, and specific government schemes like the first home buyer grant in Australia are some methods homeowners resort to when budgeting for their dream house.

To ensure that you’re securing a good deal, pay attention to the loan’s interest rate, extra fees, and repayment terms. Once you’ve vetted a list of potential candidates, you’re free to pick the best loaning option for your dream home.

That said, it can be complicated wrangling your head with all these intricacies of buying a home, especially for first-timers. As such, it may be beneficial to use a calculator to help you tally all the costs associated with home buying. Click here to use one such calculator.

7) Prepare to Be Involved Throughout the Construction

From setting up the foundation to arranging the furnishing, it can take months, if not years, to see everything through.

In order to keep costs at a minimum and quality at satisfactory levels, you need to oversee the project throughout all phases of the construction phase.

This involves regular check-ins with your contractor, attending progress meetings, making timely decisions on material selection, and periodic site visits to visually inspect the progress.