How much would it cost to potentially gut and remodel a home?

Reality check time: I have bought and renovated 3 old homes doing about 75% of the work myself and 25% with contractors, though nowhere near to the extent you are talking about and have also been a construction manager for almost 30 years. Yet I would hesitate to undertake what you are talking about. First, there are the financial issues. You won't be able to get a conventional mortgage to do this since there is no existing property value to secure the loan. Do you have at least $100,000 cash or established equity to start this project? Second, you need to be aware of the permitting and zoning requirements for the site you've chosen. Depending on the area you may run afoul of things like historical conservation rules and restrictions on such things as integral garages. Third, you need to be aware of hidden problems with an older structure you are planning to gut like foundation settling, structural integrity, lead paint and asbestos remediation. If it is an urban townhouse with party walls you will have to deal with issues involving the adjacent properties as well as restrictions on noise and working hours for your contractors. Fourth, you will have to register plans with the city building authority which will likely have to be "sealed" by a registered architect or structural engineer. Since you say you know nothing about this process, you will have to hire a builder or architect to design the house to make sure it meets structural and mechanical system codes. Fifth, if you have no experience with hiring and negotiating with contractors, you risk substantial cost over-runs and coordination problems -- overseeing such a major project is an unbelievable headache, a full-time job in fact, even if you know what you are doing. There are countless details of scheduling, assuring materials are there on time and that contractors are working as planned. Are you planning to be on site full time to watch over the work? And, not understanding the process, will you be able to tell if it is being done correctly? Chances are you would have to hire a general contractor or builder to oversee the entire project. Even in a down market like Philly, I would estimate this project would cost you from $250,000 to $300,000 and take 12 to 18 months. More, in fact, in time and money than building an entirely new home from the ground up.

It might be possible to get something going through some kind of "urban homesteading" grant program if such is available in your city, but don't expect this to be a cheap or easy process. I'm sorry to sound so negative because I am actually a big proponent of saving and renovating deteriorated urban properties and neighborhoods, but realistically this is only really "viable" if the person undertaking the work has a good bit of experience with construction and renovation OR has bottomless sources of money to pay others to deal with the complex processes and red tape that are involved. If you feel up to it, bless you! But it will be extremely stressful and costly and you need to be prepared.

I recommend that you immediately start watching as many of the renovation programs as you can on HGTV and the DIY network. A few good ones are "Holmes on Homes", "Renovation Realities", "Income Property" (though that last one makes it look too easy but at least you get an idea of budgets.) I just heard that there is a program on one of the networks tonight where a team is going to be gutting a foreclosed home -- that might be a good one to see as well.

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How much would it cost to potentially gut and remodel a home?

I am thinking of buying a shell property in an up-and-coming neighborhood in Philadelphia. I would like to get a contractor to gut the whole thing and make it to my specs. Essentially, I want a garage on the first level; new kitchen, half bath, and LR/DR on second level; and 1-2 bedrooms and full...

Gut Renovation Cost

I agree with those that said $100,000 +, but the only way to get a good idea is to have local contractors tell you what they would charge. If you really like the house and the location, you could phase the job out so you don't have to come up with all the money at once.

Check out several pages on the web site below. They might give you direction, or at least reinforce your thinking. If you decide to go forward, there are pages about contractors, and there is an e book that will give you a step-by-step guide on what you should do during the process.

Good luck.

I agree with the above estimates. But man I feel for you if you do buy this. If this is your first home -DO NOT BUY A REHAB. You are not prepared mentally for this task. I am 32 and two years ago I HAD to buy my first house. I checked out a craftsman fixer in a great neighborhood. It would have taken at least 80k to fix it. I didn't get the "charming" house. I went with a newer home that I paid 259k for. It needed no repairs, just stuff that I wanted to change (hardwood, light fixtures etc.) I sat down last weekend and added up everything I have spent and it totaled 31k.

I am sure you have visions of how fab your new pad is going to be but really take time to think about how hard this will be on your life. BTW - check out dave ramsey. He is the best financial guru out there. He has a radio show and you can listen online. Just listen to one show. Best wishes! Brooke

Nope. You could deduct repairs for an investment property or adjust the depreciation basis if there has been upgrades but none of that applies to your primary residence. A very indirect way would be to get your house appraised at a higher value and borrow against it. The loan interest is deductible. But that just isn't useful. Good Luck!

I would recommend finding a contractor so that you know what will be involved before starting this huge project. You can receive free estimates from licensed and insured contractors who are in good standings with the Better Business Bureau by visiting estimate-s.com

man its gonna be expensive if you need a contractor.im thankful i have developed an arsenal of skills in my lifetime.pending materials,i could do it for a 1/4 of what you can.but actually if you can afford it, go for it, you will get exactly what the contractor thinks you wanted.be very careful about the bid,do not pay till you are satisfied with the job.a decent contractor charges more,but they are worth it.i currently work in this sort of business.

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100,000-120,000