OUR VIEW | Are You Over Budget, or Underfunded? (part 1)

But here’s the truth: when you’re clear about your investment ceiling, you actually empower your entire team—architect, builder, and designer—to work with you, not around you.

Every project has a budget.

Even the ones that supposedly “don’t.”

It might not be in a spreadsheet, it might not be discussed on day one, but trust me—there’s always an internal threshold where a client’s enthusiasm for spending money meets a hard stop. We all have one. Whether it’s a gut check, a number buried in the back of your mind, or something you only whisper to your partner at night: there is a budget.

And that’s perfectly okay.  In fact, we prefer projects that have one.

What makes things tricky is when that internal number stays unspoken. Maybe you’re playing it close to the vest. Maybe you're afraid that sharing your limit will somehow work against you. I get it—there’s a perception that if you say your top number out loud, that’s exactly what you’ll be charged.

But here’s the truth: when you’re clear about your investment ceiling, you actually empower your entire team—architect, builder, and designer—to work with you, not around you. The clearer we are at the start, the fewer surprises we all encounter at the finish. So let’s talk about what it really means to be “over budget.” Because I’ve seen this term get thrown around in ways that miss the bigger picture.

Often what’s called an “over-budget” project is actually just an underfunded one. And yes, there’s a difference.

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IN THE BEGINING: THERE'S A CONSTRUCTION BUDGET

Here’s a common scenario: a contractor bid comes in, and it’s significantly lower than the others. That can feel like a win. But if that number is based on generic materials, sparse details, or assumptions that don’t reflect your actual vision, then we’re not talking about a budget you can rely on—we’re talking about a placeholder. A starting point built on best guesses and standard specs that may have little to do with what you want.

Not all bids are created equal. Some are laser-precise; others are more like educated guesses.

And here’s why that matters: your contractor is bidding off of what they’re given. If your plans are highly detailed, your number should reflect that. If your plans are vague, or if your design intent hasn’t been clearly communicated, they’ll fill in the blanks based on what’s typical for them. That might be a $4/SF tile that their last client loved—and that you would never pick in a million years.

So, how do construction budgets go sideways?

“When you’re in the field every day, you start to see clear patterns,” says JD Price of Sugar Creek Homes. “I tend to group bids into three categories. The first covers the hard costs—things like foundation, framing, or masonry—that won’t shift much. The second includes the licensed trades—electrical, plumbing, HVAC—which often balloon once design decisions come into play. The third covers allowances—tile, fixtures, finishes—that are almost entirely design-dependent.”

Here are a few suspects we commonly see:

• The project’s finish level wasn’t fully communicated before bidding.

  And sometimes, that’s not just about communication—it’s about discovery. Many clients don’t yet know what their finish level is because they haven’t had the chance to see, touch, or compare options. Unless you’re in the industry, you might not realize how wide the cost spectrum can be for something like tile, cabinetry, or lighting. It’s easy to assume your vision fits the budget—until you’re handed the menu and realize you’ve been eyeing the filet mignon on a salad budget. That’s why we advocate for early design engagement, so your budget reflects your true expectations from the beginning.

• The architectural plan was ambiguous, or critical details were missed during bidding.

  Not all plans are created equal. Some are incredibly detailed. Others leave a lot open to interpretation. If certain details—like custom trim, built-ins, or upgraded ceiling treatments—aren’t clearly spelled out or flagged, they may not make it into the bid. Or worse, they might be assumed as “standard.” What gets missed here doesn’t disappear—it just shows up later, either as a surprise cost or an uncomfortable compromise.

  
  

  Brian Foster, president of Sugar Creek Homes, echoes this point, stating that, “One of the biggest misconceptions clients have is the oversimplification of the budgeting process. Construction budgets are inherently complex—every aspect pushes for more.”

• Portions of the project were designated as “owner furnished” without a clear plan or tracking system.

  “Owner furnished” can sound like a money-saving move—until you realize you’re managing multiple budgets, timelines, and orders without a net. It’s easy to lose track of how much is being spent on lighting, appliances, or hardware when they’re outside the main contract. And without a system for tracking those expenses, your budget starts to feel more like a foggy memory than a working document.

  
  

• Scope has been added.

  This one seems obvious, but it sneaks up on people. That extra wall of cabinetry, the outdoor kitchen, the guest bath “while we’re at it”—they may seem small or incremental at the time. But added up, they can nudge the project far beyond its original cost framework. Changing needs are natural. But they need to be named, priced, and accounted for to avoid financial whiplash.

  
  

• Allowance amounts were too low from the start.

  Allowances are essentially budget placeholders—for items like tile, lighting, plumbing fixtures—that haven't been selected yet. But if those placeholders are set too low, they set unrealistic expectations. Choosing fixtures from a $75 faucet allowance when your tastes lean more toward Waterworks can feel disheartening at best, and budget-busting at worst. We help set realistic allowances based on your actual preferences—not just spreadsheet-friendly numbers.

  
  

• You value-engineered aspects of the design—then changed your mind once you realized the impact on the project.

  Value engineering is the polite way of saying “we found a cheaper version.” And sometimes, that’s the right call. But it’s also a slippery slope. Swapping out materials or simplifying design elements can save money upfront—but often at the cost of the original vision. And when that decision gets revisited mid-construction, it almost always costs more to pivot back than to have committed in the first place.

  
  

• Material and labor costs have changed.

  Tariffs, shortages, demand spikes, labor market shifts—they’re all real, and they’re all moving targets. If there’s a long gap between your initial bid and the start of construction, prices may have changed. This isn’t anyone’s fault—it’s just the nature of the industry right now. The best defense? Clear communication, buffer zones in your budget, and a team that keeps you informed in real time.

  
  

• The design evolved, and with it, the detailing increased.

  This is where inspiration can be both a blessing and a budgetary curse. You saw something on Instagram. You walked into a hotel lobby and fell in love. The design team has come up with a stunning concept that is in complete sync with your style and needs.  Suddenly, the powder bath that was going to be simple and clean is now the showpiece of the house. We’re not here to kill creativity—we love this part. But each added detail usually means added cost. That’s okay—if it’s intentional and budgeted. Not so great if it catches everyone off guard.

A preferred approach? Get us involved early.

Ideally, before a contractor finalizes their bid, we’ll sit down with the client for what we call a Visioning and Touch & Feel Session. We walk through your plans and talk through each room—not just how it looks, but how it feels. We show real samples. We give you general cost differences between certain selections. We talk through pros, cons, and what’s worth (or not worth) the splurge, and where! Sometimes it’s the tile. Sometimes it’s a dramatic fireplace wall. And sometimes it’s just better lighting. These sessions are where clarity is born.

Those early meetings aren’t just about scope—they’re about translation. As Brian put it, “The client simply doesn’t have the background to translate all the information we need. The more we understand the architect’s intent, the designer’s vision, and the client’s goals, the more accurate we can be.”

JD has also shared that, "In my experience, changes that happen early on drive up budget and often limit the choices that can be made during the later phases.  The allowances should be the fun part, but often the early budget creep has the opposite effect.  Picking wood floors and tile that really suite your style, selecting the beautiful countertop that feels just right… If changes have already had such an impact on our budget in the early phases, that the funds don’t fit the desires, what should be fun, becomes painful."

Their takeaway: “To set a realistic budget the entire team can follow, you have to be fairly far along in the design process—and that means the builder and designer need to be collaborating early.”

We’re not just identifying what’s possible—we’re helping you decide what’s worth it. And then we take that vision and craft a narrative for your general contractor so that when bids go out, they’re not working from guesswork—they’re working from your actual goals.

Will the number come back higher than you expected? Probably.

Is that better than playing budget roulette? Absolutely.

When we understand what’s driving the cost from the beginning, we can make smart edits, informed trade-offs, and avoid painful surprises later. Most people would rather scale back at the starting line than live in fear of unending change orders.

 STAY TUNED FOR PART 2: DESIGN BUDGETS, POSTING SOON

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BEFORE THE BUILD : A BLUEPRINT FOR CLAIRTY

Every dream home begins with a conversation—about vision, purpose, and how life will unfold within the walls to come.

Our Pre-Construction Design Service was created to bring that clarity to the table early.

We partner with clients, architects, and builders to define goals, refine scope, and craft a visual and written narrative that guides design decisions and construction budgets alike.

When intention leads the process, the build unfolds smoother, faster, and truer to the story it was meant to tell.

WORK WITH US