How to Estimate Rehab Costs: The Line-Item Budget That Survives Contractors

Ask a struggling flipper where the deal went wrong and the answer is almost never ARV — it's the rehab number. Not because renovation is unknowable, but because it was estimated as one number ("call it forty grand") instead of a list. A single number can't be checked, can't be bid against, and can't tell you mid-project whether you're on track.

The fix is boring and it works: an itemized budget, priced for your market, with a contingency you don't apologize for.

Why one number fails

A lump-sum estimate has three structural problems. You can't verify it — against a contractor's bid, an invoice, or reality. You can't track it — "spent $28k of $40k" means nothing without knowing which work is done. And you can't negotiate with it — a contractor bidding against your detailed scope is bidding against your document; a contractor bidding against your vibe is writing their own.

The line-item structure

Walk the property with this list. Every line gets a number — including $0, written down, which is a decision rather than an omission.

Exterior: roof · gutters/soffit/fascia · siding or exterior paint · windows · exterior doors · garage door · landscaping and hardscape · driveway/walkway · fencing.

Systems (the budget-breakers): HVAC — service, repair, or replace · electrical — panel, rewiring, fixtures · plumbing — supply, drains, water heater · foundation/structural, if flagged.

Interior: demo and haul-off · framing changes · drywall and texture · interior paint · flooring by room and type · interior doors and trim · stairs and railings.

Kitchen: cabinets · countertops · appliances · sink/faucet · backsplash.

Baths (each): vanity · tub/shower and surround · toilet · tile · fixtures.

Everything people forget: permits and inspections · dumpsters · utilities during rehab · lockbox/security · final clean · staging or photo-prep.

Pricing the lines in your market

There is no honest national price list, and this article won't invent one — a roof in Dallas, a roof in Cleveland, and a roof in San Jose are three different numbers. What travels is the method:

• Build your own unit costs from real quotes: get contractor bids on your first deals broken out by line, and keep the numbers. After a handful of projects you own a local price book nobody can sell you.
• Price the big five first — roof, HVAC, foundation, electrical, plumbing. These lines swing more than everything else combined; a licensed inspection on each is cheap against the alternative.
• Scope to the exit. A rental refresh and a retail flip are different spec levels; write the finish level on the line (e.g., "flooring — LVP, rental grade") so the budget and the plan can't drift apart.
• Get itemized bids. A lump-sum bid gets compared against your lines or it doesn't get signed.

The contingency rule

Add a contingency line — commonly 10–20% of the rehab subtotal, scaled to the property's age and how much you couldn't see (occupied houses, no attic access, unknown systems earn the high end). This is not padding; it's the honest price of incomplete information. The investors who "never need" contingency are the ones who quietly renamed it "the profit I didn't make."

Track against the budget, not against vibes

The itemized budget's second life begins at closing: every draw, invoice, and change order gets logged against its line. The question "are we over?" becomes answerable per-line, in minutes, before it compounds. That's also exactly what a lender wants to see when they're funding your draws.

MAOnow is not a contractor or an inspector. Prices come from your market and your bids.

Frequently asked questions

How much does it cost to rehab a house?

Honestly: it depends on scope, finish level, and — more than anything — your local labor and material market. Any article giving you one national number is guessing. Use the line-item method above with real local bids.

What percentage should I add for contingency on a rehab budget?

A common range is 10–20% of the rehab subtotal, with older properties and limited-access inspections earning the high end. Treat it as the price of unknowns, not padding.

What are the most expensive parts of a rehab?

Typically the systems and structure: roof, HVAC, foundation, full electrical, and full plumbing. Price those five first — they move the total more than every cosmetic line combined.

Should I get one bid or itemized bids?

Itemized, always. An itemized bid can be compared line-by-line against your scope and against other bids; a lump sum can only be believed or not.