Should I demolish and rebuild or renovate my house?

Demolition versus renovation

The question of renovating versus demolishing a house is one worth discussing because the cost difference in various situations can be quite substantial. Many factors go into the decision, and it’s often not a clear-cut solution either way.

Factors such as the historical significance of a building, condition of the house, “green” considerations, and possible demolition setbacks may sway your decision to demolish or to renovate. We’ll cover these topics and help you get a better grasp on whether you should demolish & rebuild or renovate the current structure.

How much does it cost to demolish and rebuild?

The cost of demolishing a house is less than you may think. The national average cost of demolishing a home is just under $9,000. However, your cost can vary based on your location, size of the house and other factors.

National Average Cost to Demolish & Rebuild a House

House Size Demolition Cost Rebuild Cost Total Cost
1,000 sq. ft. $4,000 - $15,000 $40,000 - $175,000 $44,000 - $190,000
2,000 sq. ft. $8,000 - $30,000 $70,000 - $350,000 $78,000 - $380,000
3,000 sq. ft. $12,000 - $45,000 $120,000 - $525,000 $132,000 - $570,000
A complete demolition of the house requires quite a bit of planning, obtaining the right permits, and site preparation to begin constructing the new house.
Rebuilding the new home is where the project’s overall cost makes a substantial jump. There are so many factors influencing the cost of building a new home, including its size, location, building materials, features, site work and more.
A 2,000 square foot house with average-quality features and no basement can easily cost $70,000 or more to build. However, the costs are often minimized when first demolishing the home because much of the site work is already completed (e.g., foundation (if being reused), excavation, concrete work, etc.). This work alone can cost several thousand dollars.
Cost tools:

The total cost to demolish and rebuild a house is highly variable, but expect the total project costs to range from $70,000 for a modest home in an affordable part of the country to $500,000 or more for complicated, large-scale house demo-and-rebuild projects in more expensive parts of the U.S.

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How much does it cost to remodel?

Before and after home renovation results

Renovating is an alternative to demolishing your home, and while it may sound like the more affordable option, that’s not always the case.

National Average Home Remodel Costs

Type of Remodel Minimum Cost Maximum Cost
Minor Remodel
includes: interior & exterior painting, small repairs/refinishing touches, new landscaping
$25,000 $45,000
Medium Remodel
includes: minor remodels listed above, total kitchen renovation, minor bathroom remodel
$46,000 $75,000
Major Remodel
includes: minor & medium remodels listed above, fixing foundation issues, roof, sewer line issues
$76,000 $100,000 +


The exact cost of remodeling your home will depend on its size (or how much you want to remodel) and where you live, along with which contractor you choose to hire.

Here's an example from an experienced real estate investor:

Justin Pierce is an experienced real estate investor in the Northern Virginia area, and he writes a real estate column at The Washington Post. He wrote an interesting piece about how homeowners greatly underestimate the cost of home renovation projects all too often.

In the article, Piece states that he’s never had a home renovation project cost less than $35,000. In fact, he gives an example of a 1,200 square foot, two-story house with an 800 square foot basement he completely renovated at a cost of $85,000.

While not every home renovation project will cost as much as that one, it’s unrealistic to think that a complete home renovation can be done for $10,000 or anywhere near that, as some homeowners may think. Pierce stated in the article, “…in most cases $10,000 doesn’t even buy new carpet and paint. “

Costs tend to accumulate the further you get into a renovation project and new problems are discovered.

“Hidden” problems drive up the cost of a home renovation project

Hidden dangers in the home

Often times a complete interior and/or exterior renovation of a house turns into a much bigger project when hidden problems are uncovered. For instance, tearing off drywall can reveal mold issues, leaky pipes, rotted wood/timbers, damaged wiring, cracked foundation, and other problems.

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Home inspection technology finds moisture behind walls

If you’ve ever watched those “home flipping” shows on TV, you’ve seen how frequently a $10,000 estimated budget can quickly balloon into $50,000 once the work progresses.

This isn’t to say that discovering hidden problems inside the guts of the house is a bad thing. To the contrary. It’s incredibly important to expose any hidden dangers lurking behind the walls of your home in order to keep you and your family safe.

This also isn’t to say that renovation is the inferior choice to demolition. It varies case by case. The key is proper planning before the first swing of the sledgehammer. Don’t go into the renovation project blindly and hope to stay within budget; it’s just not realistic.

Instead of finding surprises during a home renovation project, most demolition companies can come out to your home and do a full inspection to check for things like asbestos, mold, cracked foundations, and more.

A pre-demolition/renovation inspection can really make the decision between renovating vs. demolishing the home a much easier one, not to mention save you a ton of money and headaches in the long run.

Dispose of all that debris with the help of a dumpster.

Demolition and renovation projects can produce quite a bit of debris, and renting a dumpster is one of the most convenient ways to do that. For whole-home demolitions, you will typically want to rent a large 30 or 40-yard dumpster.

Hometown can help you find the right local dumpster provider for you, and we can help show you how to get the best price possible.

Learn more about renting a dumpster:

Key things to consider

There are certain factors and situations where the option to demolish or renovate is out of your hands, such as with historic buildings. These, and other special considerations, are listed below:

  • Historically significant homes (aka, “heritage homes”) usually cannot be demolished without jumping through quite a few hoops with local, state, and even Federal governments.
  • Local building codes may limit how your new home can be built following a demolition. Building codes are changed all the time, so it’s important to check them out prior to a home renovation or demolition project.
  • Trying to cut corners to save money on a home renovation – particularly prior to selling the home – can get you in hot water if the quality isn’t up to code. Worst of all, you’ll most likely have to pay to have the house repaired to get it up to spec.
  • Living in the home during a renovation project can be harmful to the health of anyone with allergies or asthma.
  • Ask yourself: Would I rather live in a brand new home designed to my liking, or keep the “bones” of my old one and replace its “skin”?
  • You can reuse parts of your old house during a demolition-and-rebuild project or a renovation project, such as timbers, windows, tiles, and historical features. It’s a green practice referred to as deconstruction, and it can save you money by cutting down on material costs.
  • Poor planning can lead to expensive renovation costs. If you’re a bad planner and don’t have a significant amount of time to be hands-on with the renovation, a demolition-and-rebuild may be a better option.
  • Get an inspection before you decide on anything! A house found to be in very poor condition structurally-speaking is better off demolished. It’s the cheaper and safer option.
  • Energy-efficiency is critical nowadays and will be in the future. Newly constructed homes tend to be more efficient than renovated homes. If energy efficiency is important to you, demolition + new construction is the way to go.
  • Most home renovations require contractors to come back at a later date for maintenance or updates. Don’t forget to factor this in when determining the cost of renovating your home.
  • You’ll almost always have a better warranty on a new home compared to a renovated one.

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What’s better: Demolition or Renovation?

And the winner is…

Upfront cost: Renovation (if properly planned out and the home is structurally sound)

Long-term costs: Approximately equal

Longevity: Demolition / New construction

Warranty: Demolition / New construction

Duration of project: Varies

Offers a roof over your head during the project: Renovation (usually)

You live in a Heritage Home (historical significance): Renovation is typically the only option

In addition to the factors above, there are many other decisions to weigh before making your decision. Start by getting a home assessment from a licensed demolition contractor or home builder. If your home is found to be structurally sound and has healthy “guts,” renovation may be an option for you. If the house has suffered major damage, has a poor foundation or you’d simply prefer to have a brand new home, go with a demolition-and-rebuild.

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