How to Estimate Rehab Costs Without a Contractor Walkthrough
One of the biggest barriers for new investors is estimating repair costs. You find a deal that looks promising, but you have no idea if it needs $20,000 or $80,000 in work.
Professional investors solve this with a three-tier estimation system that gives you a reliable range before you ever call a contractor.
The Three Rehab Tiers
Tier 1: Cosmetic Rehab ($15–25 per square foot)
Cosmetic rehabs are surface-level updates that make a property show-ready:
- Fresh paint throughout (interior and exterior)
- New flooring (LVP or carpet)
- Updated light fixtures and hardware
- Minor landscaping cleanup
- Professional cleaning
- Minor drywall patching
These properties are structurally sound but dated. Think 1990s oak cabinets and brass fixtures — ugly but functional.
Example: 1,500 sqft home × $20/sqft = $30,000 rehab budget
Tier 2: Moderate Rehab ($30–50 per square foot)
Moderate rehabs involve updating major systems and finishes:
- Full kitchen renovation (cabinets, counters, appliances)
- Bathroom remodels (tile, vanity, fixtures)
- Electrical panel upgrade
- HVAC replacement or repair
- Roof repair (not full replacement)
- Window replacements
- Some plumbing updates
Example: 1,500 sqft home × $40/sqft = $60,000 rehab budget
Tier 3: Gut Rehab ($60–100 per square foot)
Gut rehabs are down-to-studs renovations:
- Complete demo of interior finishes
- New plumbing throughout
- Full electrical rewire
- New HVAC system
- Structural repairs (foundation, framing)
- Full roof replacement
- New drywall, insulation
- Everything from Tiers 1 and 2
Example: 1,500 sqft home × $75/sqft = $112,500 rehab budget
Adjusting Your Estimates
The per-square-foot ranges above are national averages. Adjust based on:
- Property age — Homes built before 1970 tend to cost 10-20% more
- Regional labor costs — Major metros run 30-50% higher than national averages
- Property type — Multi-family units cost more per sqft due to duplicated kitchens and bathrooms
- Permit requirements — Some municipalities require permits for even minor work, adding $2,000-5,000
Key Takeaways
- Use three tiers: cosmetic ($15-25/sqft), moderate ($30-50/sqft), gut ($60-100/sqft)
- Adjust for property age, location, and type
- Watch for red flags that push costs well beyond per-sqft estimates
- Use screening estimates to filter deals, then get contractor bids before closing