Adding a contingency to your renovation budget is essential to cover unforeseen issues that commonly arise during building works. As of December 2025, Melbourne’s building industry continues to experience fluctuations in material costs and potential labour shortages, making a contingency even more crucial.
Currently in Melbourne, a contingency of 10-20% of the total renovation cost is typical. In the Eastern Suburbs, where many properties are older character homes, this figure can lean towards the higher end. This is because older properties often reveal unexpected issues like asbestos, outdated wiring, or structural problems once work commences. For example, a $50,000 kitchen renovation might require a $5,000 – $10,000 contingency. It’s also important to realise that permit delays, which can impact timelines, aren’t always factored into initial quotes. Fletchers’ experience shows that buyers in 2026 strongly favour well-maintained properties, but are also realistic about renovation potential, meaning incomplete or poorly managed renovations can negatively impact sale price. The sales process, typically 4-6 weeks, doesn’t allow much time to rectify major unexpected issues discovered late in the preparation phase.
A well-planned contingency fund provides peace of mind and allows you to address unexpected challenges without derailing your selling timeline or compromising the quality of the work.