What Will It Cost?

From a previous post, you may already know that we selected RMH Bartels Construction and how we came to that conclusion.


After we made our selection, we notified the the bank, and began the financing process.  One of the first things we had to do was provide them with a final budget that both we and RMH signed off on.

To do this, we had to sit down with RMH and finalize decisions on certain aspects of the construction project.

We also had to strategize a bit because of the need to balance what we wanted vs what we could afford vs a budget that would work for the bank.  I mentioned this before, but we had to consider that the bank will only loan up to 80% of the future appraised value of the home. Because of that, we needed the number to be low enough to be affordable, but high enough that we could get an appraised value that would justify the loan… without going over what is possible.

On top of that, for reasons I’ll explain later, the budget had to be for 100% of the remodel project.  To get the project costs down, we couldn’t simply leave items out. The budget has to reflect everything needed for a completed project.

During the contractor bidding process, Russ Bartels at RMH gave us a comprehensive initial bid, which made it easier to get to the final numbers.  It’s one of the reasons we wanted to work with them. Some of the other bids we received were based on unrealistic assumptions.  Russ did a careful review of our plans so the initial number he gave us was already close to correct and we just had to make some decisions to get to the final numbers.

That negotiation included things like how far down we were going to dig out the basement, what type of window product we would use, what sort of tile etc.

We first came up with a number around $750,000.  That number wasn’t feasible because after you tagged on the 10% that Umpqua bank would add as a construction contingency, it would mean we’d need to get an appraised value of over $1.7M.  That was an impossible number so we needed to work it down to something passable.

We kept working at it until we got to something we thought we could work with.

The number we got to is $604,213.

Category Description Cost
Masonry New foundation , keep existing grade in basement 69,100
Masonry Replace CMU Block Deck footing with new concrete footing 2,450
Window Wells New Concrete window wells 8,500
Siding Cedar lap siding 4400sf - Gable ends 1000sf 41,500
Gutters New gutters, none on turrett 4,200
Porch Roofing New Metal seamed roof- Metallion Industries 40yr Clip Loc 24 gage 11,500
Deck Flooring 1x4 T & G Primed FirDecking 7,500
Cedar Soffit 1 x3,1x6 T & G Fir Tight not 8,500
Concrete Saw cutting, driveway, walls, slab 3,350
Painting Paint Exterior Complete 11,500
Grading Foundation excavation, window well drains- Keep existing slab grade elevation 31,600
Windows Furnish and Install new windows- includes trim materials and sheeting required for window sheer walls 44,500
Windows Frame in old windows, frame new openings for new windows 8,000
Doors Exterior front and back door budgets 5,500
Deck New Single light Exterior Fiberglass door 1,850
Doors Set owner provided interior doors- 9 standard, 4 barn, 5 pocket, 1 folding 3,180
Doors Material budget allowance 2,500
Framing Lumber and Framing per Plans and specs- Decks and House 75,000
Plaster Smooth wall drywall house 39,800
Painting Paint interior walls 8,500
Trim Paint Grade FJP Fir 17,500
Stairs Stair Rail Budgets 6,500
Painting Paint interior trim 8,500
Flooring Refinish floors Main Level 9,500
Flooring Refinish Floors Master level 6,500
Flooring Carpet Attic floors and stairs 3,100
Flooring Trowel Polish Concrete Basement Floors 900
Stairs Back wood stairs to basement 2,400
Tile Master bath tile labor 8,500
Tile Master bath tile Material 3,000
Tile Attic bath Tile Labor 3,160
Tile Attic bath Tile Material 1,320
Tile Basement Subway tub tile surround 1,598
Tile Basement subway tile 300
Bath Attic Shower door 850
Tile Kitchen Backsplash labor 830
Tile Kitch Backsplace Materials 850
Plubing Plumbing Fixtures 2,500
Plumbing Rough Plumbing budget 17,900
Plumbing Finish Plumbing/ Set fixtures 2,850
Plumbing Finish and install pump for basement bath and laundry 2,500
Electrical Electrical( budget only)- Owner provide ceiling & wall mount fixtures 22,625
Electrical Lighting Budget 2,500
Insulation Attic insulation R-38, New Exterior wall insulation R-19 15,250
Cabinetry Kitchen Cabinets 13,500
Appliances Kitchen Appliances 3,500
Cabinets Master bath Vanity 2,250
Cabinets Laundry room Cabinets 3,000
Cabinets Powder and second bath vanity's 3,000
Countertops Quartz Kitchen Counters 8,500
Countertops Bath, Laundry counters Quartz 3,500
Cleanup Demo Deck, siding, interior walls misc elect, plumb, dump fees 19,500
Miscellaneous Project Management and Supervision, Permits buy owner 15,000
Permits Building, Plubming, Electrical, Mechanical Permit Budget 2,500
Total 604,213

The way we got it down to $604 was by simplifying some things and reducing material costs.

Here’s what we simplified:

  • Dropping the ceiling height in the basement and putting in a sewage pump.  This eliminated the need to run a new sewer line to the street and cut out some excavation & concrete

  • Eliminating the dry well for stormwater management for a less expensive option

  • We downgrade the windows from a Marvin product to a Milgard product.

  • We swapped some carpet and concrete for some wood flooring.

That cut about $50,000 from the budget and got us to around $700k. That was still too high.  We then eliminated a laundry list of expensive materials and cut out some big ticket items.  I know this sounds like the thing I said the bank won’t let us do.

While it’s true, the project budget we submit to the bank has to be for 100% of the project remodel, there is nothing preventing us from providing a realistic materials budget for a line item like tile or appliances, even if we actually plan on spending more than that.

So, we identified things that we could estimate based on lower cost materials or remove from the budget because there were not considered required by the bank.  These are the cost categories that removed or adjusted downward:

  • Appliances

  • Tile

  • Lighting

  • Plumbing Fixtures

  • HVAC

  • Basement waterproofing

  • Landscaping

  • Required changes to the garage

You would think things like HVAC would be required, but we only need to have a heater, and there’s an old one in the basement. So, we included that in the budget we sent to the bank, and removed $20,000 of cost. So on the upside, the budget went down, but on the downside, Jenny and I now have to bring that 20K back in later. Jenny and I had saved about that amount and intended to spend it on the project, so this looked like it could work out.


Here’s a the signed budget that was submitted to the bank.

Here’s the construction contract with RMH

This budget number meant that our property appraisal had to come in at about $1.5M in order to do the project.

And, spoiler alert…we missed that appraised value by a fairly wide margin.  For a moment, it looked like we were not going to be able to pull it off.