What are the Different Types of Remodeling Costs?

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  • Written By: L. Burgoon
  • Edited By: R. Halprin
  • Last Modified Date: 05 November 2019
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Home remodeling comes with many different types costs, some of which may not be readily apparent before embarking on a project. Homeowners should be prepared for three general stages of remodeling costs: the planning and permit phase, actual construction, and the after effects of remodeling, which may include higher taxes and insurance premiums. Remodeling estimates should take all of these potential costs into consideration so a proper budget can be drawn up before work begins.

Remodeling costs begin with the planning stages of the project. Unless the homeowner is a professional architect, an expert may be needed to plan extensive remodels. The architect’s fee will depend on the size and scope of the project as well as the professional’s experience level.

Permit costs also must be considered during the planning stage. Although rules vary by location, most renovations require municipal building permits. This is especially true if a home addition is part of the remodeling. A building permit carries a fee for the license itself, and the process also may require an expert — such as a lawyer— to speak before the governing body granting authorization. The professional’s hourly rate should therefore be considered as part of the remodeling costs.


The bulk of the expenses are incurred during construction. Most projects require the homeowner to hire one or more contractors. Large projects, in particular, require a contractor to execute the architect’s vision. The contractor will generally charge in one of two ways, a flat rate or a percentage of the total project cost. With the flat rate, homeowners know from the outset how much they must budget to cover contractor costs, while a percentage fee entails only an estimate. The cost of building materials, such as lumber, nails, and paint, should be included in the fee, as should any equipment and subcontracting needs.

Unforeseen remodeling costs may occur during the construction phase. If the project faces delays, perhaps because of weather, the overall cost of the project may increase. Homeowners also may find themselves unable to live in or use their house during the renovation. This can add expenses such as hotel stays or restaurant meals to the overall project tally.

Remodeling costs do not necessarily end with the project’s completion. The renovations may drive up other expenses, such as home insurance and property taxes. Insurance rates and property taxes are both based on the value of the property, and home improvements tend to increase that figure. Premiums and taxes are therefore likely to rise at some point after a renovation project wraps up.


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