Making home renovations can transform the look of your living space, increase your house’s property value, and improve your comfort and enjoyment. However, renovating a house can also be a costly endeavor.

Here we explore how much it costs to renovate a house in 2024, ways to fund your home renovations, tips on how to save money, and frequently asked questions.

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How much does it cost to renovate a house?

Home renovation costs are rising. Together, Americans spent an estimated $567 billion on home upgrades and repairs in 2022, a 15% jump from 2021, according to the Joint Center for Housing Studies of Harvard University’s Improving America’s Housing 2023 report.

At the time of writing, renovating a 1,250- to 1,600-square-foot home costs an average of $49,963, according to 2023 data compiled by Angi.com, a home improvement resource. But renovation project costs can vary widely depending on the size, age, and condition of your home, the scope of the work, and the materials used.

Cost estimates to completely renovate a house

Remodeling a whole house costs an average of $10 to $60 per square foot, according to a nationwide survey of home contractors by HomeAdvisor. At the time of writing, completely remodeling a 2,500-square-foot home could cost anywhere from $25,000 to $150,000, with a high-end custom remodel potentially exceeding that spend.

Homeowners looking to do a gut renovation, or make significant structural changes, can expect to pay more.

Homeowners can expect to pay a general contractor, as well as — depending on the project — electricians, plumbers, and interior designers. In addition to labor costs, materials, and new appliances will factor into the total cost of a house remodel.

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Home renovation cost by type

Let’s look at the average cost for specific types of home renovations at the time of writing, based on HomeAdvisor data:

Add a room

Building a new room, like an additional bedroom or a living room, typically costs $80 to $200 per square foot, including materials and labor.

Renovate a bathroom

The average bathroom remodel costs $125 per square foot. A primary bathroom renovation can run up to $28,000.

Renovate a kitchen

A full kitchen remodel costs on average $26,800, or approximately $150 per square foot, with typical costs running between $14,612 and $41,325. An upscale kitchen remodel, using the most high-end materials, can exceed $130,000. The average gut job, which entails a new layout, costs $30,000 to $80,000.

A kitchen renovation could include new light fixtures, new flooring, upgraded faucets, new cabinetry, or new countertops.

Remodel a garage

Remodeling a garage costs an estimated $6,000 to $22,000 on average. Building a garage from scratch runs an average of $28,351, or between $16,418 and $40,285.

Exterior remodel

Exterior updates cost between $5,000 to $15,000 on average, depending on the type of work and the size of the house. More specifically, painting the exterior of a 1,500-square-foot house costs an average of $1,810 to $4,466 — and painting a two-story home could cost as much as 50% more than to paint than a one-story home.

Financing a home renovation project

Cash from savings is the most common source of home improvement funding, accounting for nearly four out of five projects, the Harvard University study found. But if you’re not sitting on a ton of savings, there are several ways to finance a home renovation: a home equity loan, a home equity line of credit, or a cash-out refinance.

• Home equity loan. Also known as a second mortgage, a home equity loan allows you to access the equity you’ve built in your home by using your home as collateral. Home equity loan rates can vary depending on how much equity you’ve accumulated, your credit score, and your debt-to-income ratio. Typically, you can borrow up to 80% of your home’s appraised value, minus what you owe.
• Home equity line of credit. A home equity line of credit, or “HELOC,” allows you to open a line of credit against your house, providing access to cash of up to 80% to 90% of your property’s appraised value. Unlike home equity loans, HELOCs have variable interest rates.
• Cash-out refinance. A cash-out refinance allows you to refinance your current mortgage for more than what you currently owe and pocket the difference in cash. Generally, you can borrow up to 80% of your home’s appraised value.

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Common home renovation costs

These are the most common types of home renovation expenses, at the time of writing:

• Labor. Labor is often the largest home renovation cost. Typically, consumers spend about $20 to $150 per hour for labor, according to Angi.com.
• Materials. An estimated 82.5% of construction materials saw a significant cost increase in 2022, according to construction cost data tracking firm Gordian. Steel prices rose at the fastest rate (up 22%), followed by wood (16%), concrete and masonry (15%), electrical conduit (12%), and insulation (11%).
• Permits. Nationally, a building permit costs $1,602 on average, HomeAdvisor says, but costs can vary depending on where you live and the type of project you’re doing. Contact your local building permits agency for prices.
• Taxes. Don’t forget to factor in taxes when crafting your budget. (Pro tip: Certain home renovations, such as solar panels and home office improvements, may qualify for a tax deduction.)
• Unforeseen costs. A good rule of thumb is to set aside an additional 10% to 15% to accommodate for surprise expenses, such as mold lurking behind drywall in an older home.
• Type of house. Whether you live in a single-family house, a townhome, a condominium, or a co-op can impact your home renovation costs.

Additional home renovation costs

These extra expenses can add a significant amount to your home renovation costs:

• Temporary living arrangements. If you’ll need to stay at a hotel or a rental while the work is being done, make sure to budget for your living arrangements.
• Floor plan changes. If you’re looking to change your home’s floor plan, you’ll need to hire an architect. Most residential architects charge between $70 and $250 an hour depending on their level of experience and area of expertise, HomeAdvisor says.
• Foundation repairs. Repairing foundation problems typically costs from $2,171 on the low end up to $7,811, according to HomeAdvisor. Repairing small issues, such as minor cracks, can cost as little as $500; major repairs, on the other hand, can cost $10,000 or more.
• Mold or asbestos remediations. Professional mold remediation typically costs between $1,300 and $3,150, HomeAdvisor reports, depending on the type of mold, how big the mold problem is, and where the mold is located. Asbestos removal costs $1,191 to $3,236 on average, depending on the size of the area, labor, materials, and other factors, HomeAdvisor found.

How to estimate home remodel costs

Determining how much a home renovation is going to cost can be a challenge, since costs can vary widely depending on where you live, the age and condition of your home, the materials you select, and other factors. But to get a ballpark estimate, you can refer to HomeAdvisor’s True Cost Guide and Remodeling Magazine’s Cost vs. Value Report. Both guides let you see average costs both nationwide and in your zip code.

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Tips to save on home renovation costs

Looking for ways to curb your home renovation expenses? Consider these cost-cutting strategies:

• Choose lower-cost finishes. Selecting less-expensive materials can help you save money. Case in point: Ceramic tile for a bathroom remodel costs about $1 to $15 per square foot, whereas marble costs about $15 to $190 per square foot, Angi.com says.
• Hit the recycling center. Nationwide, Habitat for Humanity operates more than 1,000 ReStores, which sell used materials at lower prices.
• Shop around for contractors. Get multiple quotes before hiring a contractor for the job.
  Do some work yourself. A little DIY can go a long way. Consider tackling prep work, such as cleaning and sanding surfaces, prior to bringing in a professional to complete the job.
• Find deals on appliances. Independent retailers and appliance outlets often offer lower prices than major home improvement stores.

How much does it cost to renovate a house FAQ

What’s the difference between a house rehab, renovation, and remodel?

Many people use the terms house rehab, remodel, and renovation interchangeably, but they differ slightly. Generally, a home rehab entails making home improvements while preserving the historical and character-defining features of the home. Renovation is when you improve the condition of a home by repairing, altering, or adding features. And remodeling is a complete makeover of a room or house.

Is $100,000 enough to renovate a house?

A six-figure budget can go a long way when renovating a house, but it may not be sufficient, depending on the scope of the work, the condition of your home, labor rates in your area, and what building materials you choose. For example, building a home addition can surpass $100,000 depending on the type of room being added, the square footage of the addition, and the materials, according to HomeAdvisor.

Is it cheaper to renovate a house or build from scratch?

In most cases, it’s more affordable to renovate than to tear down a home and build a new home from scratch, since renovating allows you to avoid costly demolition expenses.

What is the most expensive room to renovate in a house?

Generally, a kitchen renovation is the most expensive, with a mid-scale kitchen remodel running anywhere from $30,000 to $65,000, HomeAdvisor reports.

Is a full house renovation worth it?

This depends on your goal. A full house renovation might make sense if you’re looking to flip a property and turn a profit, but it may not be a good idea if you’re on a shoestring budget or planning to take on high-interest credit card debt to foot your renovation expenses.

Which remodeling projects have the highest ROI?

Not all remodeling projects are equal with respect to return on investment. New kitchens and bathrooms typically deliver the best ROI. Some of the worst remodeling projects for a home’s resale value include backyard patios, sunrooms, home office additions, and in-ground swimming pools — although ROI for specific projects can vary depending on where you live. (Adding an in-ground pool in steamy Phoenix, Arizona, would yield a better return than adding an in-ground pool in chilly Minneapolis, Minnesota).

Bottom line: When is a home renovation worth it?

Certain home renovations are worth it, at least from a return-on-investment perspective, while others aren’t.

It can be a good way to improve your home value but take a close look at your renovation budget before you begin a renovation to make sure you have enough funds to get the job done. No one wants to live in — or purchase — a home that looks like a construction site.

Check your cash-out refinance interest rates. Start here (Nov 23rd, 2024)