Simplifying the 30% Home Remodeling Rule:

The seasons have changed from rainy to dry, and thus, remodeling season is upon us. Considering this, it’s particularly pertinent to know the basics behind the financials of renovation. A renovation project can sound like a daunting task, but, by following this rule, projects can be made streamlined with clear financial parameters.

The Basics:

Renovations can be a powerful tool used for improving the value and worth of your home, while also instilling a fresh new look you can enjoy. The best way to go about planning a renovation project is by making a financial checklist. If a home is valued at around $400k, a renovation budget of $120k is your ceiling.

Naturally, not every renovator needs or wants to change that much in their home, so it’s important to identify what is manageable for your current living situation. In order to maximize real returns, smaller projects could be your best bet rather than large overhauls.

The Journal of Light Construction has a useful guide on predicted ROI (return on investment) values by project by using 2025 data for costs. Renovators can use this chart to predict/map out future remodels.

Costs:

Now comes the most important deciding factor in your renovations: cost. As mentioned previously, larger projects aren’t always the way to go if you want to increase the value of a home. The national average cost for a large-scale kitchen remodel, which involves changing the kitchen’s layout, was a staggering eighty two thousand dollars in 2025, while the return was forty two thousand dollars, making the recoup only 51%.

Smaller projects, like a minor kitchen remodel that preserves the previous layout, had costs listed at an average of $28k. The return on this smaller remodel was 113%, creating a larger long-term financial win for your home.

The most efficient overall remodel plan incorporates gradual but effective projects in order to achieve the best outcome.

Potential Projects:

With this, it’s only natural to lay out some potential projects that give you the best ROI. While this section is focused on high ROI projects, many projects that may not give the largest monetary gains are still very important to consider in your renovation roadmap. A popular option that falls under this category, the kitchen/bathroom remodel, is not a “bad” project to implement into your home by any means.

Shifting our view back to those smaller projects, a great first project is always going to be replacing doors, as the highest single project listed by the Journal of Light Construction is replacing your garage doors. This gives an average return of 268%, and a replacement steel front door gives a return of 216%.

Replacing your siding, however, costs a fair amount more, but it still gives positive returns. Having an active construction timeline of 1 or 2 weeks, a replacement of siding ensures your home is protected from rot and the elements. This is a perfect introductory project that helps homeowners step into renovations. If projects like these, or a new place for your projects sounds like something in your future, reach out to a Ruoff Mortgage loan officer today!