Guide · 6 min read
How Renovation Budgets Really Work
What actually drives the cost of a high-end renovation, how staged payments protect you, and why the contingency matters.
Most renovation horror stories are really budgeting stories: a price that was never realistic, scope that was never written down, or payment terms that left the client carrying all the risk. Here is how we think budgets should work — and what to watch for whoever you build with.
What actually drives cost
- Structure. Steels, underpinning, new openings and anything load-bearing carry engineering, labour and inspection costs that finishes never will.
- Services. Rewires, replumbs, new heating and drainage are invisible in photographs and significant on invoices. They are also the worst place to economise.
- Specification. The same kitchen layout can vary several times over in cost depending on cabinetry, stone, appliances and brassware. Decide specification early — it is the biggest lever you control.
- The property itself. Older London housing stock hides surprises: historic movement, dead timbers, non-compliant past work. This is what the contingency is for.
- Access and logistics. Parking suspensions, skip permits, scaffolding and restricted working hours all show up in London budgets.
Fixed price vs estimates
A fixed-price contract is possible once the design and specification are frozen — you get certainty, and the contractor prices the residual risk. An estimate is appropriate earlier, while decisions are still open. Be wary of a "fixed" price quoted before anyone has measured the property or seen a specification: it will move, by design.
Staged payments protect both sides
You should never be asked for a large sum before work starts. Payments should be staged against completed work — for example: a modest mobilisation payment, then instalments at agreed milestones (strip-out complete, first fix complete, plastering complete, and so on), with a final balance held until snagging is closed. This keeps the incentives aligned all the way to handover.
The 10% rule
However thorough the survey, older properties keep secrets until they are opened up. Hold a contingency of around 10% of the build cost (15% for period properties). If it isn't needed, it becomes budget for the things you'll want at the end — better lighting, that extra piece of joinery. If it is needed, it keeps the project moving without difficult conversations.
Watch the exclusions, not the total
Comparing quotes on the bottom line alone is how projects go wrong. Check what each price excludes: building control fees? Skips? Sanitaryware? Decoration? A cheaper headline with long exclusions usually costs more by handover. Our estimates itemise by stage and state exclusions plainly — and we would rather lose a tender than win one on ambiguity.
Every project is different and prices move with the market — treat this as orientation, not a quotation. A written, itemised estimate for your specific property is free.