How to Remodel a House on a Budget

Dreaming of all the improvements you can make with a house remodeling project is a lot of fun. Paying for all those improvements? Not as much fun—but not impossible. Knowing how to remodel a house on a budget can save you some serious cash if you know what you're doing. Reusing items, making detailed price comparisons, doing DIY work, and getting creative goes a long way. Learn the steps you can take to remodel your home when money is tight.

How Do I Set a Budget to Remodel My House?

When setting a budget to remodel your home, start by determining what you want to spend. Then figure out how to receive the best return on investment (ROI) for that amount.

You should budget for an amount that doesn’t affect your non-discretionary monthly living expenses. Don’t put off paying the credit card bill or the mortgage to fund your remodeling project. You could boost your budget by borrowing from discretionary spending, though. Try eating out less for a few months or skipping a vacation if you want to spend more on your remodeling project.

To find the money for the project, consider using: 

• Savings: Some people save money for several months toward a remodeling project. You don’t want a remodeling project’s cost to consume all your emergency savings, though.

• Borrowing: If your remodeling project will boost your home’s value, a home equity loan is worth considering. Make sure any monthly payment fits into your household budget.

• Combination: A mixture of savings and borrowing is a good way to find some extra money for a larger project.

Perhaps you can’t afford the full remodeling project you want to do. If so, you could do part of the remodeling project now and finish some other aspects later. When your budget for the remodeling project is tight, doing the work in stages is perfectly fine. 

However, don’t leave yourself with a half-finished bathroom after phase one because you have exhausted your limited budget. Be sure you have enough in the budget to make the remodeled space at least livable and usable at the end of each phase. Then, enhance the project later when you have more money. 

How Much Does It Cost to Remodel a House?

Your house renovation cost depends on the exact work you’re doing. The average cost is about $52,000. Don’t feel pressured into spending this much if you don’t have that kind of budget, though. Some people spend as little as $3,000 for a remodeling project that makes an impact. You simply have to be a little creative to stretch the budget that you can afford.

How to Prep for Remodeling a House on a Budget

When preparing to remodel a house on a tight budget, start with these steps.

• Shop around: Check a few different stores for material costs. You may save quite a bit by investing just a little time in price comparisons. Some stores may have items you want on clearance.

• Look for price breaks: Some hardware stores may give you free delivery if you spend a certain amount. Others may offer a percentage discount on bulk orders. Include these savings in your calculations as you figure out where to buy your materials.

• Do timely renovations: What is the best time of the year to remodel a house? Some projects cost less to do at certain times of the year. For example, doing an indoor renovation in winter may help you find contractors looking for work outside of the busy summer season. They may cut you a deal on labor costs.

• Finalize your budget: After collecting accurate costs for material and labor, make a final determination on what you’ll spend for the remodeling work. Then force yourself to stick to that budget.

• Prep the area: Figure out where you’ll store items that normally exist in the renovated area. Remove everything from the space, so it’s ready when the contractors arrive. To receive the greatest benefit from hourly charges, you want the pros working on the project rather than moving furniture around.

How to Remodel a House on a Budget

Here are some specific steps you can take to have a successful remodeling project on a tight budget.

Keep Your Existing Furniture

Rather than buying all new furniture to go into the remodeled space, reuse anything you can. Maybe your old sectional isn’t quite what you envisioned for the new space. However, if it’s still functional, you’ll save money versus buying a new piece. Put more money into the actual remodeling work now and buy new furniture later.

Preserve Your Cabinets

In a kitchen remodel, you may want new cabinets. However, the cost of installing new cabinets averages $6,400. Try refreshing outdated kitchen cabinets with paint. You may be able to paint them yourself, saving money over hiring a painter.

Save on Countertop Materials

When redoing a kitchen, new countertops will likely be high on your priority list. You can save some money on the cost of a countertop installation by going with mid-range materials that still look great and offer significant durability. Rather than spending up to $140 per square foot for high-end granite, consider quartz for about half the price.

Maintain the Same Layout

When figuring out how to remodel a house on a budget, you can save money in a kitchen or bathroom by sticking to the same basic layout. If you don’t move a shower or toilet across the bathroom, your current plumbing fixtures can stay where they are. This saves quite a bit of money compared to running new plumbing lines. 

Look for Look-Alikes

If you want a high-end flooring material, but it doesn’t fit in your remodeling budget, look for a lower-priced alternative that looks similar. Vinyl plank floors are inexpensive and easy to install, and they can resemble almost any kind of high-end flooring. Engineered hardwood flooring is another low-cost option that resembles real hardwood floors.

Consider Second-Hand Stores

Rather than going with high-end new materials, visit local stores that collect recycled building materials. You may find some vintage materials that are still in good condition at a bargain price. The vintage items can give your remodeling project a unique feel that new products can’t quite duplicate. 

Avoid Customization

Try to incorporate off-the-shelf items in your remodeling project. Stick with normal sizes of items. If you make decisions that require custom-made materials, you’ll drive up the cost of the project and potentially ruin your budget. You also may end up with project delays if custom items don’t arrive on time. Save money with standard items that your local hardware stores have in stock.

Don’t Make Last-Minute Changes

If you change your mind about something in the middle of the project, it’ll cost you more. Having to return materials you purchased earlier because of last-minute changes can cost quite a bit in potential restocking fees. If a contractor already began working and has to start over because you changed your mind, you could deliver a fatal blow to your budget. Research all your decisions before the work starts and be confident in your choices.

Do Some Work Yourself

The more work you can do on your own, the more money you’ll save in labor costs. Frequent DIY-ers could do quite a bit of the work themselves. Novices may need to pick and choose easier DIY jobs. When deciding whether to hire a pro or do a particular job yourself, don’t forget to calculate the cost of buying or renting tools you’ll need. If you need a lot of tools, hiring a pro who already has the tools will cost less.

Ask Your Contractor for Ideas

If you decide to hire a contractor for the remodeling project, ask for help with saving money on materials. Your local general contractor may be able to source bargain-priced materials or may have some leftover items from another project that will work perfectly in your home. The contractor may suggest DIY-ing certain jobs to save money, too.

Tips for Remodeling a House on a Budget

Follow these tips to have more success remodeling a house on a budget.

• Don’t buy luxury items: Choosing to add a hot tub or sauna to your home during a remodeling project sounds like a great idea. However, these types of luxury items aren’t the best use for a limited budget.

• Avoid odd design choices: When remodeling a house on a tight budget, stick with common flooring materials and paint colors. Quirky floor tiles or unusual colors may seem fun now, but you could tire of them quickly. If you change your mind and decide you need to replace them after several months, you wasted your limited budget.

• Focus indoors: If you have a limited amount of money to spend, use it to make your living spaces better. Avoid spending money on landscaping. Focus on remodeling the interior of the home, where you receive a greater ROI.

• Shop around for a loan: If you’re going to borrow money for your remodeling project, shop around for the best rate. If you are paying a lower interest rate than you expected, you might be able to borrow a little more for the remodeling work.

• Allow for some cost cushion: Even though you’re working on a tight budget for your home remodeling, you should put some cushion in the budget. Try to preserve 10% to 20% of your budget to guard against potential cost overruns.

DIY vs. Hiring a Remodeling Pro

When figuring out how to remodel a house on a budget, one of the biggest areas of savings is doing some of the work yourself. Even if you don’t have a lot of experience with home improvement projects, you may be able to handle some of the basics.

If you are attempting to do basement remodeling on a budget, for example, you might be able to:

• Demolish old drywall

• Remove old flooring

• Install new flooring

• Waterproof concrete block basement walls

• Paint walls

• Add rolls of insulation to framed walls or ceilings

• Hang a drop ceiling

• Install ceiling fans

• Install wainscoting, hang a chair rail, or install shiplap

• Move furniture or appliances to prepare for remodeling work

By doing some work yourself, you potentially can save labor costs of anywhere from $20 to $150 per hour. The amount you’ll pay for labor depends on the type of work being done. Plumbers and electricians cost more per hour than painters and flooring installers, for example.

However, you shouldn’t try certain jobs yourself. If your foundation needs extensive repairs before you can remodel the basement, this is a challenging job best left to the pros. It’s worth hiring a pro for work that requires specialty tools and experience, like electrical and plumbing jobs.

Contact a local home remodeler for a price quote for your planned remodeling work. Ask the pro to break out the costs by each aspect of the remodeling work. The remodeler can advise what projects you could try to do on your own to save some money.