Table of Contents
- Introduction
- Types of Home Renovation
- Factors Influencing Home Renovation Costs
- Breakdown of Home Renovation Costs
- Tentative Renovation Cost Based On Different Rooms
- Financing Options for Home Renovation
- Best Financing Options For Home Renovation
- Home Renovation Cost Based on Locations
- Mistakes to Avoid During Home Renovation
- Conclusion
- Faq's
Introduction
You have been living in your dream home for a decade, life has been good, your home makes you feel safe and proud. But overtime, you feel the need for a home renovation. You notice the colour of the walls are not as vibrant as it was before, the electrical wiring has been giving problems quite frequently, the bathroom needs a fresh look. You gaze around and can't help but envision the endless possibilities that lie among the walls. You imagine a new marble top countertop to cook your favourite meals, turn the corner space in your living room to a cozy reading nook, and a makeover for your bathroom.But, the daunting question that lingers in you mind is: "How much will it cost?"
Home renovation is a significant investment for any homeowner, and it is crucial to understand the costs involved to plan effectively. In India, where the home renovation market is projected to reach INR 24,000 crores by 2025, growing at a CAGR of 15%, the quest for the perfect home is no longer a distant dream. With the increasing availability of affordable loan options for home renovation, more and more Indians are taking the leap to give their homes a makeover.
This article aims to demystify the world of home renovation costs, providing Indian homeowners with a comprehensive guide to navigate the complexities and make informed decisions. By understanding the factors that influence costs, the breakdown of expenses, and the financing options available, you can turn a new chapter for your dream home, without breaking the bank
Types of Home Renovation
Types of Home Renovation
The types of home renovation projects available to homeowners in India include:
Whole-house Renovation: This involves a comprehensive makeover of the entire house, including all rooms, fixtures, and appliances. It can be a significant investment, with costs ranging from ₹5,00,000 to ₹10,00,000 or more, depending on the extent of the renovation.
Kitchen Renovation: A kitchen renovation can include updating cabinets, countertops, appliances, lighting, and layout to create a functional and aesthetically pleasing space. Costs can vary from ₹2,00,000 to ₹5,00,000 or more, depending on the extent of the renovation.
Bathroom Renovation: A bathroom renovation can involve upgrading fixtures, replacing tiles, installing new bathtubs or showers, and introducing captivating lighting solutions. Costs can range from ₹1,50,000 to ₹3,00,000 or more, depending on the extent of the renovation.
Exterior Renovation: This involves enhancing the exterior of the house, including the siding, windows, doors, roof, and landscaping. Costs can vary from ₹1,00,000 to ₹3,00,000 or more, depending on the extent of the renovation.
Smart Home Renovation: This involves integrating smart home technologies, such as automation, security systems, and energy-efficient appliances, into the home. Costs can range from ₹50,000 to ₹2,00,000 or more, depending on the extent of the renovation.
Addition or Extension: This involves adding new rooms or extending existing ones to increase the overall living space. Costs can vary from ₹5,00,000 to ₹10,00,000 or more, depending on the extent of the renovation.
Garage Conversion: This involves converting a garage into a functional space, such as a home office, playroom, or storage area. Costs can range from ₹50,000 to ₹2,00,000 or more, depending on the extent of the renovation.
These are some of the common types of home renovation projects that homeowners in India can consider.
Also Read: Top 10 Kitchen Lighting Trends for 2024
Factors Influencing Home Renovation Costs
The total cost of home renovation in India depends on several factors, including:
Quality and Pricing of Materials
The quality and pricing of materials used for renovation significantly impact the overall cost. High-end materials like premium woodwork, custom furniture, and detailed craftsmanship can increase the cost substantially. For instance, using high-quality marble for flooring can cost significantly more than using ceramic tiles. Similarly, opting for custom-made furniture can be more expensive than using mass-produced pieces. Homeowners must carefully consider their material choices to balance their budget with their desired aesthetic.
Carpentry Work and Storage Requirements
The extent of carpentry work and storage needs also contribute to the overall cost. These elements can account for a substantial portion of the budget. For example, if a homeowner wants to add custom cabinetry or intricate woodwork, the cost can increase significantly. Similarly, if they require additional storage space, such as built-in shelves or closets, the cost will also rise. It is essential for homeowners to carefully plan their carpentry and storage needs to ensure that they stay within their budget.
Design and Décor
The design and décor of the home, including the designer's reputation and expertise, can range from budget-friendly to luxurious, with costs varying from INR 10-20 lakhs for budget-friendly designs to INR 5,000 per square foot for comprehensive luxury projects. Homeowners must consider their design preferences and budget constraints when selecting a designer. They should also ensure that the designer is experienced in creating the desired style and has a good understanding of the budget constraints.
Civil Work, Electrical Wiring, and False Ceilings
Essential aspects like civil work, electrical wiring, and false ceilings are crucial components of luxury home interiors, adding to the overall cost. For new luxury apartments, these elements can range from INR 6,000 to INR 8,000 per square foot in metropolitan cities like Mumbai. Homeowners must carefully consider these elements when planning their renovation, as they can significantly impact the overall cost.
Breakdown of Home Renovation Costs
To better understand the costs involved, here is a detailed breakdown of the expenses:
Design and Décor: INR 10-20 lakhs for budget-friendly designs and INR 5,000 per square foot for comprehensive luxury projects.
Civil Work, Electrical Wiring, and False Ceilings: INR 6,000 to INR 8,000 per square foot in metropolitan cities like Mumbai.
Carpentry Work and Storage Requirements: Varies depending on the extent of work required.
Materials and Furniture: High-end materials and custom furniture can increase the cost significantly.
Tentative Renovation Cost Based On Different Rooms
Kitchen Renovation
Kitchen renovations are typically one of the most expensive projects due to the extensive work involved.
- Costs can range from Rs 1,50,000 to Rs 5,00,000 or more, depending on factors like:
- Cabinets: Rs 10,000 - Rs 30,000 per linear foot
- Countertops: Rs 2,000 - Rs 5,000 per linear foot
- Appliances: Rs 20,000 - Rs 50,000+
- Backsplash: Rs 1,000 - Rs3,000 per sq. ft.
- Flooring: Rs 50 - Rs 150 per sq. ft.
- Sink and Faucet: Rs 2,000 - Rs 5,000
Bathroom Renovation
Bathroom renovations are also quite expensive, with costs ranging from ₹60,000 to ₹2,50,000 or more.
Key cost components include:
- Demolition and Removal: Rs 5,000 - Rs 10,000
- Plumbing and Electrical: Rs 10,000 - Rs 25,000
- New Tiles and Flooring: Rs 15,000 - Rs 30,000
- Bathtub or Shower: Rs 5,000 - Rs 20,000
- Vanity and Sink: Rs 5,000 - Rs 15,000
- Toilet: Rs 3,000 - Rs10,000
Living Room Renovation
Living room renovations are relatively more budget-friendly compared to kitchens and bathrooms.
- Costs can range from Rs 60,000 to Rs 2,20,000 or more, including:
- Flooring: Rs 10,000 - Rs 50,000
- Wall Paint and Finish: Rs 5,000 - Rs 20,000
- Lighting and Fixtures: Rs 5,000 - Rs 20,000
- Furniture and Decor: Rs 15,000 - Rs 60,000
Bedroom Renovation
Bedroom renovations are generally more cost-effective, with an average range of Rs 44,000 to Rs 1,30,000 or more.
Key expenses include:
- Flooring: Rs 10,000 - Rs40,000
- Wall Paint and Finish: Rs 5,000 - Rs15,000
- Lighting and Fixtures: Rs 3,000 - Rs 10,000
- Furniture and Decor: Rs10,000 - Rs 30,000
Other Rooms
Dining Room: Rs 60,000 - Rs1,80,000+
Home Office/Study: Rs 40,000 - Rs 1,00,000+
Basement: Rs 60,000 - Rs 2,00,000+
Garage: Rs 50,000 - Rs 1,50,000+
Laundry Room: Rs 40,000 - Rs 80,000+
It's important to note that these are approximate ranges, and actual costs may vary depending on the specific project, location, and material choices. Planning a realistic budget and considering additional expenses like permits, labor fees, and contingencies is crucial for a successful home renovation project in India.
Financing Options for Home Renovation
Home renovation loans are an attractive option for Indian homebuyers, offering several benefits:
Financing Option For Home Renovations
Lower Interest Rates
House renovation loans are generally available at the same interest rates as home loans, making them a more affordable option for homeowners. This is because the interest rates for both home loans and home renovation loans are based on the same factors, such as the borrower's credit score, income, and loan amount. For instance, Kotak Mahindra Bank offers home renovation loans at interest rates ranging from 8.49% to 9.00% for salaried individuals and 8.55% to 9.10% for self-employed individuals. Similarly, HDFC Bank offers home renovation loans at interest rates starting from 8.70% per annum. This means that homeowners can enjoy the same interest rates for their home renovation loans as they would for their home loans, making the renovation process more affordable.
Tax Benefits
Homeowners can claim a tax deduction of up to INR 30,000 per annum on the interest paid on their home renovation loans. This is in accordance with Section 24(b) of the Income Tax Act, which allows homeowners to claim a deduction of up to INR 30,000 on the interest paid on their home loans. This deduction can be claimed by both existing and new homeowners, making it a significant benefit for those looking to renovate their homes. For example, if a homeowner pays INR 1,00,000 in interest on their home renovation loan, they can claim a tax deduction of up to INR 30,000 on that interest. However, note that this deduction of Rs 30,000 falls within the limit of Rs. 2 lakhs that have been set for loan interest payment on self-occupied homes
Minimal Documentation
The documentation process for home renovation loans is relatively simple and requires basic documents like identity and income proof. Homeowners need to provide proof of their identity, income, employment, and address, as well as proof of the property they are renovating. The documentation process is similar to that for regular home loans, and lenders usually require the same documents to process the loan application. For instance, HDFC Bank requires the following documents for a home renovation loan: a duly filled application form, age proof, income proof, proof of employment, address proof, property documents, and an estimated repair cost quotation. This minimal documentation makes it easier for homeowners to apply for and secure a home renovation loan.
Quick Processing
House renovation loans are processed quickly, allowing homeowners to start their renovation projects without delay. The processing time for home renovation loans is generally shorter than that for regular home loans, as the loan amount is typically smaller and the renovation process is more straightforward. For example, Kotak Mahindra Bank claims to provide a sanction letter within 10 minutes of applying for a home renovation loan. Similarly, HDFC Bank claims to process home renovation loans quickly, allowing homeowners to start their renovation projects without delay. This quick processing time makes it easier for homeowners to plan and execute their renovation projects efficiently.
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Best Financing Options For Home Renovation
The best financing options for home renovation in India include:
Home Renovation Loans:
These loans are specifically designed for home renovation projects and offer competitive interest rates and flexible repayment terms. Home renovation loans are generally available at the same interest rates as home loans, making them a more affordable option for homeowners.
Home Loans:
Home loans can be used for home renovation projects, especially if the renovation is extensive or involves significant structural changes. Home loans typically offer longer repayment terms and lower interest rates compared to personal loans.
Personal loans
Personal loans can be used for home renovation projects, especially if the renovation is smaller or involves non-structural changes. Personal loans typically offer shorter repayment terms and higher interest rates compared to home loans.
Credit Cards:
Credit cards can be used for home renovation projects, especially if the renovation is smaller or involves non-structural changes. Credit cards typically offer higher interest rates and shorter repayment terms compared to loans.
Home Renovation Financing Options from Banks:
Many banks in India offer specialised home renovation financing options, such as the HDFC Home Renovation Loan or the ICICI Home Renovation Loan. These loans typically offer competitive interest rates and flexible repayment terms.
Home Renovation Financing Options from Non-Banking Financial Companies (NBFCs):
NBFCs like Bajaj Finserv, Fullerton India, and Home Credit offer home renovation financing options with competitive interest rates and flexible repayment terms. These loans typically offer shorter repayment terms and higher interest rates compared to bank loans.
It is essential to carefully evaluate the interest rates, repayment terms, and other conditions of each financing option before making a decision. Homeowners should also consider their credit score, income, and loan amount when selecting a financing option.
Also Read: Best Home Loans In India - Updated Interest Rates, Eligibility, Features
Home Renovation Cost Based on Locations
Delhi
- Basic Renovation (Painting, Flooring, Fixtures): ₹30,000 to ₹1,00,000 per room
- Structural Renovation (Wall Demolition, Roof Repair): ₹500 to ₹2,000 per square foot
- Complete Remodeling: ₹2,000 to ₹5,000 per square foot
- Flooring: ₹50 to ₹500 per square foot based on material choice
- Cabinets and Countertops: ₹1,500 to ₹5,000 per linear foot
Delhi, being the capital city of India, has a high demand for home renovations. The cost of renovation in Delhi can vary depending on the location, quality of materials, and labor costs. For example, a basic renovation in a mid-range locality like Lajpat Nagar or Panchsheel Park can cost around ₹50,000 to ₹1,00,000 per room. On the other hand, a complete remodeling of a luxury apartment in a high-end locality like Greater Kailash or Vasant Vihar can cost upwards of ₹5,00,000 to ₹10,00,000 per room.
Bangalore
- Average Renovation Cost: ₹1,100 to ₹1,500 per square foot
- Flooring: ₹200 per square foot onwards for ceramic tiles
- Kitchen Remodeling: ₹1,000 per square foot
- Bathroom Renovation: Up to ₹1.5 lakh
The cost of renovation in Bangalore can vary depending on the location, quality of materials, and labor costs. For example, a basic renovation in a mid-range locality like Koramangala or HSR Layout can cost around ₹80,000 to ₹1,50,000 per square foot. On the other hand, a complete remodeling of a luxury apartment in a high-end locality like Indiranagar or Whitefield can cost upwards of ₹2,00,000 to ₹3,00,000 per square foot.
Mumbai
- Average Renovation Cost: ₹400 to ₹750 per square foot depending on the finish
- Civil Work, Electrical Wiring, False Ceilings: ₹6,000 to ₹8,000 per square foot in luxury apartments
Mumbai, being the financial capital of India, has a high demand for home renovations. The cost of renovation in Mumbai can vary depending on the location, quality of materials, and labor costs. For example, a basic renovation in a mid-range locality like Bandra or Andheri can cost around ₹200,000 to ₹400,000 per square foot. On the other hand, a complete remodeling of a luxury apartment in a high-end locality like South Mumbai or Bandra can cost upwards of ₹1,00,000 to ₹2,00,000 per square foot.
Gurugram
- Average Renovation Cost: ₹400 to ₹750 per square foot depending on the finish
Gurugram, being a major IT hub, has a high demand for home renovations. The cost of renovation in Gurugram can vary depending on the location, quality of materials, and labor costs. For example, a basic renovation in a mid-range locality like Sector 14 or Sector 29 can cost around ₹200,000 to ₹400,000 per square foot. On the other hand, a complete remodeling of a luxury apartment in a high-end locality like Sector 44 or Sector 56 can cost upwards of ₹1,00,000.
Mistakes to Avoid During Home Renovation
Here are some common mistakes to avoid during a home renovation:
Poor Planning:
Make sure to create a detailed budget and timeline for the home renovation, as poor planning can impact your budget and day-to-day life. It is best to sit and consult with professionals before setting a proper timeline.
Inadequate Research:
Probably one of the first steps to take when you have decided to go for a home renovation is to do adequate research. Not researching the different materials and their costs can be a huge shocker post the completion of your project.
Along with materials, one also needs to be aware of the local building code and regulations one has to follow during renovations. Not being aware of the laws can cause unnecessary hurdles.
Insufficient Budgeting:
It is imperative that unexpected expenses are taken into consideration while creating a budget. Planning ahead, and having a contingency fund for this purpose can be very effective.
Inadequate Communication:
Miscommunication among contractors and suppliers, often are one of the biggest challenges faced by homeowners during a renovation. Setting clear expectations and deadlines and taking constant periodical updates can help immensely to make the process easier.
Not Considering the Impact on Daily Life:
Let's face it, home renovation means breaking the pattern of how your daily life functions. Often the members of the family have to share one room and bathroom, taking all of this into account beforehand and creating a plan can help make the transition easier. If you have pets or family members dependent of you, it is best to arrange a separate place for them.
Conclusion
In conclusion, home renovation is a significant investment for any homeowner, and it is crucial to understand the costs involved to plan effectively. The total cost of home renovation in India depends on several factors, including the quality and pricing of materials, carpentry work and storage requirements, design and décor, and civil work, electrical wiring, and false ceilings. By understanding these factors and the breakdown of expenses, homeowners can make informed decisions about their home renovation projects.
Home renovation loans are an attractive option for Indian homebuyers, offering several benefits
such as lower interest rates, tax benefits, minimal documentation, and quick processing. Homeowners can claim a tax deduction of up to INR 30,000 per annum on the interest paid on their home renovation loans, making it a significant benefit for those looking to renovate their homes.
The cost of renovation in different cities across India varies depending on the location, quality of materials, and labor costs. For example, the cost of renovation in Delhi can range from ₹30,000 to ₹1,00,000 per room, while in Bangalore, it can range from ₹1,100 to ₹1,500 per square foot. In Mumbai, the cost of renovation can range from ₹400 to ₹750 per square foot depending on the finish.
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