Home Improvement Budgeting in Oregon: 3 Expenses That Surprise Renovators and Remodelers

If you’re planning a renovation or remodeling project in northeastern Oregon, you’ve probably looked at the big costs like materials, labor, and maybe even new appliances. But many homeowners are surprised when their budget runs out because of hidden expenses.

We’ll review three common examples and how you can budget more accurately for your home improvement project.

Soft Costs: Permits, Inspections, and More

Before the work even starts, you may need to pay for “soft costs” which are expenses not directly related to building materials or labor. Architect and engineer fees, permits, inspections, and surveys all fall into this category.

In Oregon, permit costs vary by county and project types. While rural areas like Wallowa, Union, and Baker County often have lower fees than big cities like Portland, you’ll need permits for major structural changes, electrical works, or plumbing upgrades.

For example, a home addition with structural changes may require:

1. A building permit

2. Electrical and plumbing permits

3. Plan review fees

As a general rule of thumb, 20-30% of a construction project’s total cost is made up of soft costs.

Budgeting for Home Improvement Soft Costs in Wallowa, Union, and Baker Counties, Oregon

While there is no way to totally remove soft costs from your project, here are a few ways to reduce the financial burden:

1. Call your county building department early to confirm which permits and inspections you’ll need.

   1. Wallowa County: 541-426-7766

   2. Union County: 541-963-1014

   3. Baker County: 541-524-2054 ext. 201

2. Ask your contractor to include all soft costs in their estimate.

3. Add 20-30% to your budget for unexpected requirements.

   
   

Theft of Materials

Did you know theft is the most common claim for buildings under construction or major renovation? (US Assure)

Luckily, we see less theft in our rural neighborhoods, but it doesn’t hurt to be proactive.

Materials left lying about at the end of each work day are easy to haul away, especially if your property is near a highway or visible from the road.

How to Protect Building Materials From Theft

Make sure you and your contractor have a plan for protecting materials. You might:

1. Store valuable materials in a locked building or storage container.

2. Specify in writing who is responsible for securing the site each day.

3. Check your homeowner’s or builder’s risk insurance to make sure it covers materials used in construction.

   
   

Contractor Disputes & Coverage Gaps

Sometimes, your or the contractor may choose to end the contract due to disagreements before the project is complete. When that happens, insurance coverage they arranged may end immediately.

In our area, replacing a contractor is no picnic. With high demand and a limited number of contractors, it can take weeks or months to find a replacement. These delays can also lead to seasonal challenges with our long winters.

Why Purchase Your Own Builder’s Risk Insurance

If you purchased your own builder’s risk insurance, you stay covered no matter which contractor is on the job. Builder’s risk insurance protects against theft, vandalism, fire, wind, and other damage during construction. You can also add optional coverages for things like extra expenses if delays mean you have to reapply for permits.

Having your own builder’s risk policy ensures there are no coverage gaps if the contractor changes, or while you’re searching for a replacement. Be sure to read your policy to understand any limitations!

Protect Yourself from Unexpected Renovation and Remodel Expenses

Whether you’re updating your kitchen, adding a shop, or renovating a rental property, planning ahead makes a big difference.

Builder’s risk insurance is one way to help mitigate surprise expenses that commonly disturb home improvement budgets in Oregon. For example, let’s say your renovation is 90% complete. You can practically taste all the delicious food you’ll cook in your new kitchen, or how good it will feel to soak in your upgraded tub… but then, a trespasser vandalizes the property and causes significant damage that must be repaired. The project is drawn out and you learn that you need new permits for some of the repairs.

Luckily, the builder's risk coverage can help with the costs, not only to repair the damage, but also for the soft costs (if you added that endorsement!) associated with the new permits.

While it may not be as glamorous as your Pinterest board, builder’s risk insurance is essential for remodels and major renovations. Contact us to get a quote for your next project. Let’s make your dream a reality, without all of the headache!