If home improvements or renovations are in this year's budget, whatever you're planning to spend, it isn't enough. That number you've landed on? Consider it an educated guess, an estimate or wishful thinking.

That's because home improvements and renovations often cost more than people anticipate, experts say. If you know the reasons why, perhaps you can avoid an unpleasant surprise when you tally up your final bill.

[See: 12 Home Improvement Shortcuts That Are a Bad Idea.]

You aren't a professional. You probably think you've done your homework. You've consulted family and friends on what they were charged for a project, or you've comparison shopped with some home contractors. But it isn't as if you know every minor detail that comes with a renovation or home improvement project. How could you?

For instance, Andrew Greer, a San Diego-based real estate agent, renovator and developer, says that you might be hiring a painter to paint a room. But you probably don't realize the scope of the work involved.

"Maybe they forget they will want to change baseboard when they paint, or that the door is not included in painting or that the hardware on the door will not match," Greer says.

You overlook the cost of little extras. You know purchasing a granite countertop instead of a plastic laminate will increase your costs – maybe by a lot. But even the most innocuous cosmetic changes can add significant expense to a project, says Kathy Moran, a design and project manager with Dawson Builders in Chicago. She says clients often ask to add something extra to a project, not realizing what's involved.

"It's not just the items themselves, but all the things that need to get done to install or change it. For example, if you add a can light to your dining room, it's not just the cost of the light, but the time to patch, sand and repaint the entire ceiling," Moran says.

Greer agrees, calling this the "rule of unintended consequences."

"Maybe you want a new kitchen arrangement with cabinets. The cabinets are in, and you realize lighting doesn't work now, or you don't have electrical plugs, or you're told that you can upgrade items for what seems to be a small cost because you are doing a full replacement. These items add up and change the entire layout," he says.

[Read: 6 Easy Home Upgrades for Under $100.]

Your thinking is skewed, thanks to home improvement TV shows. This happens a lot, according to Nicole Silver, spokeswoman for TrustedPros.com, a home improvement website based out of Toronto.

"Industry thought leaders on HGTV typically disclose a project price that is unrealistic due to donated time, labor and materials [by builders who are looking] for TV exposure," Silver says.

TrustedPros.ca, the Canadian website, recently compiled data from over 2 million users in determining the top home improvement projects. Silver says more often than not, when Canadians estimated their budgets, they came up with figures that weren't realistic. For example, Canadians budgeted $14,479 for kitchen renovations when TrustedPros concluded that a realistic budget would be at least $20,000. Too often, homeowners were forgetting that beyond a home contractor, they would also need to hire electrical, plumbing and gas experts, pros that don't come cheaply.

Additional professionals can add costs in other ways, warns Jesse Fowler, president of Tellus Design + Build, in Costa Mesa, California.

"Be careful of architects, designers and/or even contractors, who base their fees on a percentage of the total project cost," Fowler says. He offers up the example of an architect who states that his or her fee is 10 percent of the final build cost. According to Fowler, if you buy $5,000 in appliances for a renovated kitchen, that architect pockets an extra $500 – "for nothing."

You may be working with someone shady or misinformed. Silver says this happens a lot, too. "Dishonest contractors will intentionally low-ball a project price to get a homeowner interested," she says. "As the project proceeds, the common scheme is to charge more and more for unexpected issues."

Greer has seen this as well. He suggests reading your quote from a contractor very carefully. Sometimes items are left off on purpose, to make you feel better about the price, and sometimes it's simply a mistake, he says. Of course, if you're hiring a contractor through a hardware store, whomever you're working with may be new enough to the job that he isn't familiar with how markups between various parties can shift a price and thus doesn't think to caution that his ballpark estimate may be way off.

In any case, if the quote doesn't mention various materials and hardware, it may be a sign that your price is going to rise, Greer says.

[See: Weird Home Features That May Confuse Homebuyers.]

You're doing the project yourself. You will save money on labor, but you still may find that you can't stay within your desired budget.

"If a homeowner is doing the project without experience, there is going to be learning curve attrition," says Eugene Gamble, an investor based in Barbados who owns property in the U.S. and England. In other words, Gamble says, you may end up wasting a lot of raw materials because this is your first time using a circular saw.

Gamble says this used to happen to him a lot when he would try and rehab a property himself.

"I thought I was saving myself money when in fact it was both cheaper and quicker to hire a professional. I now no longer do skilled jobs," he says.

But, of course, hiring professionals means you're back to seeing your prices climb. Your best bet, Moran says: "Get a line-by-line detailed budget," and even then, she suggests, "allot 10 to 15 percent extra for unknowns."

Tags: real estate, home prices, home improvements, housing


Geoff Williams has been a contributor to U.S. News and World Report since 2013, writing about a variety of personal finance topics, from insurance and spending strategies to small business and tax-filing tips.

Williams got his start working in entertainment reporting in 1993, as an associate editor at "BOP," a teen entertainment magazine, and freelancing for publications, including Entertainment Weekly. He later moved to Ohio and worked for several years as a part-time features reporter at The Cincinnati Post and continued freelancing. His articles have been featured in outlets such as Life magazine, Ladies’ Home Journal, Cincinnati Magazine and Ohio Magazine.

For the past 15 years, Williams has specialized in personal finance and small business issues. His articles on personal finance and business have appeared in CNNMoney.com, The Washington Post, Entrepreneur Magazine, Forbes.com and American Express OPEN Forum. Williams is also the author of several books, including "Washed Away: How the Great Flood of 1913, America's Most Widespread Natural Disaster, Terrorized a Nation and Changed It Forever" and "C.C. Pyle's Amazing Foot Race: The True Story of the 1928 Coast-to-Coast Run Across America"

Born in Columbus, Ohio, Williams lives in Loveland, Ohio, with his two teenage daughters and is a graduate of Indiana University. To learn more about Geoff Williams, you can connect with him on LinkedIn or follow his Twitter page.

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