How to Estimate a Rehab Budget in Under an Hour

Which two rehab-estimation methods do flippers actually use?

New investors overthink rehab estimates. Experienced ones use one of two methods, always with a contingency layered on top.

How do you estimate rehab with the $/sqft method?

Multiply the finished square footage by a $/sqft assumption based on scope. As of 2026:

• Cosmetic (paint, floor, fixtures, appliances): $15–25/sqft
• Standard (kitchen, baths, HVAC, some drywall): $35–55/sqft
• Full gut (studs-out, new mechanicals, structural): $75–120/sqft
• Historic / permit-heavy (Philly rowhome, DC brownstone): $110–160/sqft

A 1,600 sqft house needing a standard rehab: 1,600 × $45 = $72,000. Use this for the first pass through 20 MLS listings.

How do you estimate rehab room by room?

Once a deal makes the shortlist, walk it and price every room. Rough 2026 numbers for a mid-tier finish:

• Kitchen (full gut, 10×12): $18,000–28,000
• Bathroom (full gut, 5×8): $9,000–14,000
• Roof (asphalt, 2,000 sqft): $8,500–14,000
• HVAC (3-ton system): $8,000–12,000
• Windows (per window, vinyl): $650–1,100
• Flooring (LVP, per sqft installed): $5.50–8.00
• Interior paint (whole house, 1,600 sqft): $4,500–7,500
• Exterior paint: $5,000–9,000
• Electrical (panel + partial rewire): $5,500–9,000
• Plumbing (repipe, 3/2): $8,000–14,000

Add them up. Compare to your $/sqft screening number. If they're more than 15% apart, one of them is wrong — usually the $/sqft.

How much contingency should you add to a rehab budget?

Add 15% to whatever number you land on. Not 10, not 5. Fifteen. Every experienced flipper carries this because:

• Permits reveal work that wasn't visible
• Framing surprises (rot, termites, non-load-bearing walls that turn out to be load-bearing)
• Material price swings (LVP alone moved 20% in 2024)
• Subcontractor no-shows push timelines and force overtime

On a $50,000 estimated rehab, budget $57,500 all-in. If you don't use the contingency, that's your extra profit. If you do use it, you weren't wrong — you were correct.

What should you check on the walkthrough?

• Roof age (ask, then look — sagging, missing shingles, moss)
• HVAC age (sticker on the unit; anything over 15 years budget replacement)
• Electrical panel (Federal Pacific, Zinsco → replace, $2,500+)
• Foundation cracks (horizontal = structural, vertical = usually not)
• Plumbing supply lines (galvanized → repipe, cast iron drains → probably repipe)
• Water heater age
• Windows (single-pane → replace all)
• Every bathroom for soft floors around the toilet
• Kitchen layout — can you keep it or does it need to move?
• Basement/crawlspace for moisture, mold, joist damage
• Photos of every wall so you can price paint later

What blows up rehab budgets most often?

1. Assuming the layout stays. Moving a wall to open the kitchen adds $6,000–10,000.

2. Ignoring permit costs. In some jurisdictions permits + plans + inspections = $4,000+.

3. Forgetting exterior. Landscaping, driveway, and paint move a $180k comp to a $210k comp.

4. Under-scoping electrical. A "just add a few outlets" scope becomes a full rewire the moment the inspector finds knob-and-tube.

Rehab pricing is local too. Compare the average rehab budgets we track for Houston, TX, Dallas, TX, San Antonio, TX, and Phoenix, AZ before trusting a national $/sqft number.

Run the full deal through the analyzer with your estimated rehab + 15% contingency, and you'll know before you sign the contract whether the deal survives the worst realistic case.