How to Reduce the Cost and Save Money in Your Home Renovation
Renovating a home is a significant financial commitment, and even a small percentage reduction in costs can translate into thousands—if not tens of thousands—of dollars in savings. For this reason, homeowners should approach cost control not just during the planning phase but throughout the entire renovation process. While many people focus on budgeting at the start, unexpected expenses often arise once work begins, making ongoing financial oversight just as critical.
From careful planning to strategic decision-making during execution, there are several ways homeowners can keep their renovation costs under control without sacrificing quality. Below, we explore some proven techniques to help reduce expenses while maintaining a well-executed renovation.
At Remodelum, we’ve helped thousands of homeowners successfully plan and track their renovations. This guide is a synthesis of what we’ve learned from those projects
Smart Cost Control Starts in the Planning Phase
The choices made before work even begins have a huge impact on overall renovation costs. By defining a clear scope of work, gathering competitive quotes, and ensuring accurate pricing, homeowners can lay the foundation for a cost-effective renovation
Define a SMART Scope of Work
One of the most common reasons homeowners face unexpected costs is ambiguity in the scope of work. A vague or poorly defined project plan gives contractors room for interpretation, often leading to change orders that drive up costs. For example, a simple line item in a contract that states "Fix the roof of the shed" is open to multiple interpretations. Does "fixing" mean patching small holes, adding a new layer of asphalt, or fully replacing the roof? Each option carries a very different price tag. If a homeowner assumes full replacement is included but the contractor only accounted for minor repairs, any adjustments later will come at a higher cost, with little room for negotiation. For a better understanding of SMART scoping check our renovation estimation guide.
To avoid this, homeowners should create a detailed, itemized scope of work that specifies the exact materials, finishes, and expected outcomes for each aspect of the project. Remodelum’s planning module helps homeowners clarify their project details by offering structured description fields, ensuring that contractors and homeowners are aligned on expectations from the start.
Compare Quotes to Discover the True Cost of Your Renovation
A key strategy for managing renovation costs is getting multiple quotes. By comparing estimates from at least three different contractors, homeowners can identify pricing discrepancies and missing scope items. If one contractor quotes significantly lower for a specific task, it might mean they are cutting corners or pricing a different level of service. On the other hand, if a contractor’s price is much higher than others, it could indicate unnecessary markups or an overestimation of labor and materials.
It’s important to remember that contractors don’t always use a precise formula to estimate costs. Instead, they may rely on previous experience or rough calculations, leading to significant price variations for the same work. Remodelum’s quote comparison tool standardizes contractor estimates, making it easy for homeowners to spot inconsistencies and make informed decisions.
Use Competitive Bidding to Get the Best Price
Once homeowners have a solid understanding of what their renovation should cost, the next step is to bid out the project to contractors. While obtaining quotes is about price discovery, bidding ensures that contractors adjust their pricing to match realistic market rates. Many homeowners accept the first quote they receive, unaware that pricing in renovations is often flexible. By showing contractors that their estimates are being compared, homeowners can reduce inflated costs and ensure they are paying a fair price for each element of the project.
Cost-Saving Strategies During the Execution Phase
Even with meticulous planning, renovations rarely go exactly as expected. Change orders, unforeseen issues, and fluctuating material costs can all add up. However, homeowners who stay actively involved in tracking costs and challenging unnecessary expenses can still maintain control of their budget.
Monitor Costs and Payments in Real Time
One of the biggest mistakes homeowners make is losing track of their spending as the renovation progresses. Without a detailed record of expenses, it’s easy for costs to spiral out of control. Small additions and upgrades may seem insignificant in isolation, but they can add up quickly over the course of a months-long project.
Many contractors operate informally when it comes to cost changes. A contractor might mention a small surcharge over the phone or send a text about an additional expense without formal documentation. These seemingly minor changes can accumulate into thousands of dollars in unexpected costs. By the time these changes make it into an invoice—or worse, when the homeowner receives the final bill—it’s too late to negotiate or adjust the budget.
To prevent this, homeowners should track every expense in real time, ensuring they have a complete record of payments, changes, and remaining balances. Remodelum’s renovation tracker provides an intuitive way to log expenses and communicate with contractors, making sure both parties stay aligned and avoid financial surprises.
Challenge Unnecessary Change Orders
Change orders—modifications to the original project scope—are a major driver of cost overruns. While some change orders are unavoidable, such as uncovering structural issues hidden behind walls, many arise due to poor initial planning or contractors increasing prices once the project is underway. Some contractors may even strategically underbid a project to secure the job, only to inflate costs later through change orders when the homeowner has fewer options.
To stay on budget, homeowners should:
Anticipate potential change orders during the planning phase. Pricing out extra work in advance—even if it isn’t initially included—helps prevent surprises later.
Challenge expensive or repetitive change orders. If a change order seems excessive, it’s worth asking for a second opinion before approving it.
Use industry benchmarks. On average, change orders should not exceed 20% of the original budget. Significant deviations from this threshold could indicate pricing manipulation.
Remodelum’s tracking system allows homeowners to quantify change orders and monitor deviations from the planned budget, making it easier to spot red flags early.
Bid Out Large Change Orders Instead of Accepting the First Price
When a major change order arises—such as the need to rewire a home’s electrical system or install new plumbing—homeowners often feel pressured to accept the contractor’s proposed price without question. After all, the work has already begun, and bringing in another contractor mid-project can seem disruptive. However, large change orders can significantly inflate costs, and contractors know homeowners are less likely to seek competitive pricing once work has started.
While homeowners should be mindful of maintaining a good relationship with their contractor, bidding out large change orders is a perfectly reasonable practice when handled diplomatically. If a contractor is aware that the homeowner will verify costs with other professionals, they are less likely to inflate prices unnecessarily.
A simple way to approach this is to frame it as a practical decision rather than a challenge to the contractor’s pricing. For example, homeowners might say, "Since this isn’t your area of expertise, I’d like to get a second opinion before we proceed." This approach keeps the homeowner-contractor relationship intact while ensuring that prices stay competitive.
Final Thoughts: Keeping Renovation Costs Under Control
Staying within budget during a home renovation is no easy task, but with the right approach, homeowners can significantly reduce unnecessary expenses and avoid financial surprises. From careful planning and competitive bidding to real-time cost tracking and challenging excessive change orders, proactive cost management can lead to thousands of dollars in savings.
At Remodelum, we’ve built a platform designed to help homeowners plan, track, and manage their renovation finances with ease. Whether it’s comparing contractor quotes, monitoring real-time expenses, or controlling change order costs, Remodelum provides the tools to keep your renovation on budget from start to finish.