How Much Contingency Should You Add to Your Renovation Budget?
Excited about renovating your home? I get it. But here's something that trips up even the most organised homeowners: unexpected costs that pop up once work begins.
That's why smart renovators always build a contingency fund into their budget. It's your financial safety net when surprises happen – and with renovation, they almost always do. Our guide to hidden renovation costs reveals the most common budget-busters to watch for.
But exactly how much should you set aside? Let's break it down so you can plan with confidence.
What exactly is a contingency fund?
Simply put, it's money you keep in reserve specifically for unexpected costs during your renovation.
Think of it as your renovation emergency fund. When you discover outdated wiring behind walls, or your builder finds a patch of damp that needs sorting, your contingency is there to handle it without derailing your entire project or forcing you to compromise on your vision.
Why you absolutely need one
Even the most detailed plans can't predict everything. Recent data shows 58% of homeowners end up spending more than their original budget due to surprises during renovation.
Skipping the contingency is a bit like driving without insurance – it might seem fine until suddenly it's not. And when you're halfway through a kitchen renovation with no working sink, that's not when you want to be scrambling for extra cash.
How much contingency do you really need?
The right amount varies based on your property and project type. Here's what we recommend:
10% for newer homes or minor cosmetic updates
If your home was built in the last 20 years and you're just refreshing surfaces, 10% should cover unexpected issues.15-20% for kitchens, bathrooms, or older homes
These rooms involve plumbing and electrical work that often hide surprises. Older homes generally contain more unknowns. If you're planning a kitchen renovation, decisions like choosing between built-in vs freestanding appliances can also impact your overall budget flexibility.20-25% for extensions, loft conversions, or major structural work
Complex projects that affect the structure of your home carry the highest risk of unexpected costs.
For example, if you're planning a £30,000 kitchen renovation, setting aside £4,500-£6,000 as contingency gives you breathing room to handle surprises without stress.
When you might need an even bigger buffer
Some situations call for a more cautious approach. Consider adding extra to your contingency if:
Your home is over 100 years old
There's evidence of previous DIY work (especially the dodgy kind)
Your property is listed or in a conservation area
Access is tricky (like top-floor flats or narrow mews houses)
These factors increase the likelihood of discovering issues once work begins. Making big decisions like whether to DIY or hire professionals also affects how much contingency you'll need – professional work often requires less buffer for mistakes, but more for potential specialist costs.
How to manage your contingency fund
Once you've set your contingency aside, here's how to handle it:
Keep it separate from your main budget – don't be tempted to dip into it for upgrades
Track all expenses carefully throughout your project
Prioritise structural or essential fixes over aesthetic improvements
Discuss with your builder upfront about when contingency might be used
And should you tell your builder about your contingency? It's good to mention you've planned for unexpected costs, but you don't need to share the exact amount. This shows you're prepared without making your budget seem flexible. Learning how to get a renovation quote that's detailed and comprehensive can also help reduce surprises later.
How we reduce the need for massive contingency funds
At Beams, we take a different approach to renovation planning. Instead of accepting that massive budget overruns are just "part of renovation," we work to identify potential issues before a single wall comes down.
Our process combines data from over 4,000 UK projects with detailed 3D scans of your space. This helps us spot problems during planning – not halfway through construction when they're more expensive to fix.
The result? Most Beams projects stay within just 2% of their planned budget, compared to industry averages of 10-20% overrun. That means more of your money goes toward creating your dream space, rather than sitting unused "just in case."
Ready to renovate with confidence?
Whether you're updating a bathroom, refreshing your kitchen, or tackling a whole-home renovation, having the right contingency in place gives you peace of mind.
Whether you're renovating a kitchen, bathroom or entire home, Beams gives you the tools, insight and support to move forward with confidence.
Get your free estimate today
