Kitchen and Home Remodel Financing

Kitchen and home remodel costs vary greatly based on the scope and complexity, material quality, cost of labor, and numerous project specifics like design fees, permits, and unexpected building issues that might be uncovered when remodeling an older home. That said, a simple cosmetic update like painting your kitchen cabinets, installing a new backsplash, or changing your kitchen faucet can refresh the look. So, a minor kitchen remodel with simple updates that focus on surface-level changes can keep cost down while delivering an updated feel.

On the other hand, altering your home’s existing layout for a look that varies greatly from simple cosmetic updates requires adding up all the parts and pieces to determine the estimated costs for the renovation based on the actual scope of work. Whether your kitchen and home remodel is a minor refresh or a major overhaul, working with our team at Details Construction Group will give you a better understanding of the real world factors that can allow you to set a realistic budget and better manage your expectations.

Generally speaking, home remodeling costs are determined by the size of the project, complexity, structural changes, quality of materials (e.g., custom cabinets or standard), labor rates, the skilled trades required, unexpected issues (e.g., plumbing not up to standards), and actual fees for permits, etc. Definitely higher-end finishes and specialized work in kitchens and bathrooms can cost more due to intricate features like moving walls or system changes to plumbing, electrical, or heating and air conditioning.

What is the 30% home renovation rule?

Having evolved over time, the 30% rule for home remodel is a simple budgeting tool that combines real estate principles and financial guidelines to prevent eager homeowners from overspending on renovations. To protect resale value and ensure a good return on their remodeling investments, this smart budgeting tool says homeowners should never spend more than 30% of their home’s value for any single space. In other words, if your home is worth a half million dollars, your maximum budget for an outdoor remodel with a lanai, hot-tub, kitchen, and an entertainment center would be about $150,000. For the most part, the core of the 30% guideline stems from encouraging owners not to over-improve a property for a given neighborhood, which could make it much more difficult to recoup costs when selling the home. While helpful for setting limits on home, kitchen, or bathroom remodels, it is a guideline and not the law.

Cost Recovery of a Home Remodeling Project

Although homeowners remodel, redesign and restructure their existing property for a wide variety of reasons, we can help you weigh the anticipated benefits against a Free Estimate to see what it the increased happiness will cost once your project is completed. Last year, according to the National Association of Realtors, almost half of home buyers surveyed were less willing to compromise on the condition of the home they were purchasing, which resulted in $603 billion spent on remodeling of existing properties in 2024.

Today, the lack of housing affordability and the rise of mortgage rates, ever since the pandemic, have become a motivating factor in many homeowner’s decision to undertake specific remodeling projects. Some of the reasons given for upgrades included: replacing worn-out surfaces; refinishing or replacing materials like cabinetry; improving the overall energy efficiency of the dwelling; specific need for more space; increasing the overall value of the dwelling for a future sell; or simply because they felt it was time.

Central Florida’s weather inspires many existing homeowners (as well as some who are just purchasing a home) to consider an outdoor remodel that will expand the dwelling’s useful square footage. Remodeling a seldom-used outdoor space to include a screened lanai or an outdoor kitchen can expand an existing layout to include a fresh air view with a versatile outdoor room that’s insect-free. In addition, it can be customized with ceiling fans, a pizza oven, a fire-pit, or TVs to offer a seamless transition to the out-of-doors for entertaining guests.

Practical Strategies for a Kitchen or Home Remodel

Beyond the widely known 30% Renovation Rule, there are several practical budgeting strategies that you can use to help prioritize both your “wants” and “needs” that can help prevent budget overruns or a disappointing return on your investment later on. Although less common, one of the strategies below may be more applicable in addressing your immediate needs:

Stage Approach – Also called the “pay as you go” method, this strategy allows you to break an overall major remodeling project into smaller, more manageable stages by paying for each project as you go without financing the entire project upfront. Since most people prefer to hold onto their cash or savings, this can help homeowners avoid overspending beyond available funds. Where buyers may prefer an upfront overhaul, existing homeowners may want to manage the debt.
Cost Per Square Foot – Rather than using a percentage of your home’s current value, this strategy focuses on the size of the kitchen, bathroom or home space that you want to remodel. As your contractor, Details Construction Group can provide a granular view based on the actual material and labor costs for any specific area of the home. For example, a kitchen remodel or bathroom remodel can cost significantly more per square foot than renovating your bedroom space.
Worst Room First – Naturally, people tend to favor tackling their most appealing project for remodeling a home space first, but it doesn’t always means that’s the room where your renovation efforts should start. Based on the age of the property, there can be areas of the home that have more urgent issues like structural damage or outdated electrical that demand priority. The “worst room first” philosophy helps prevent unaddressed minor issues from becoming expensive emergencies.
Prioritization of Needs vs Wants – Our talented team at Details Construction Group can help you do a thorough review of all your desired projects, including a kitchen remodel, bathroom remodel, outdoor remodel, etc. and create a separate listing of your “wants” and “needs”. For example, fixing a water leak or making structural repairs are essential needs. Whereas, moving a wall or replacing kitchen cabinets are discretionary wants. For starters, you focus the majority of your budget on key needs.
Room Value Percentage – As a variation of the percentage rule for renovations, this strategy recommends spending no more on a specific space than the room’s approximate percentage of the home’s resale price. Since an additional bedroom can represent up to 20% of a home’s total market value, your remodel financing should not exceed that same percentage of the home’s future value. This method is particularly helpful by making the homeowner focus on the ROI upfront.

At Details Construction Group, we can help our Orlando area homeowners by providing a FREE Estimate that more accurately reflects both obvious costs like labor and materials, as well as make suggestions for how to financially manage any unexpected expenses. Moreover, we can assist with your review of the various options based on your specific needs, including home equity loans, personal loans, government backed programs, and specific financing plans available through local remodeling companies like ours.