How to Estimate Refurb Costs on a Property Deal

The fastest way to price a refurb is to multiply the floor area by a rate per square foot or square metre. It is quick, and for a rough back-of-envelope filter it has its place. But as your actual costing method it is dangerous, because it hides where the money really goes.

Two properties of identical size can have wildly different refurb costs. One needs a full rewire, a new boiler, a new kitchen and bathroom and replastering throughout. The other needs new carpets, a coat of paint and a tidy-up. A flat per-square-foot figure treats them the same. It also has no idea that kitchens and bathrooms are the most expensive rooms per square metre in the whole house, so a property that happens to need both will be badly underpriced by an area-based rule.

A room-by-room method forces you to look at each space and ask what actually has to be done in it. You build the total from real work, not from an average. The result is slower to produce but far more accurate, and crucially it is itemised, so when a price comes in different from your estimate you can see exactly which line was wrong and adjust your model for next time. A single all-in rate per square foot gives you nothing to learn from.

Most deals are first priced from listing photos before you ever set foot inside, so reading photos well is a core skill. Look past the staging and at the fabric of the building. Dated but functional is cheap. Damaged, missing or unsafe is expensive.

In the kitchen and bathroom, note the age and condition of the units, worktops, tiling and sanitaryware, and whether the layout works or needs moving (moving plumbing and waste is what makes a bathroom expensive). On floors, walls and ceilings, look for cracking, damp staining, blown plaster, artex and uneven surfaces that signal replastering rather than just filling. Check window frames for rot and single glazing, and look at the consumer unit (fuse board) in any photo of the hallway or cupboard: an old fuse-wire board is a strong hint that a rewire or at least a partial rewire and new board is coming.

Outside, scan the roof line for slipped or missing tiles, the gutters and fascias, render cracks and the general state of the garden and boundaries. If the listing mentions no central heating, a back boiler, or storage heaters, budget for a full heating system. Where you have a survey or a Level 2 or Level 3 report, read it before you finalise anything: damp, timber, roof and structural movement findings can turn a cosmetic budget into a heavy one overnight, and those are exactly the items that wreck deals when missed.

Be honest about what you cannot see. Photos rarely show the electrics, the loft, under the floors or behind the units. That uncertainty is one of the reasons you carry a contingency, covered below.

Once you know what each room needs, price the work as discrete line items rather than one lump. The headings below are the items that appear on almost every refurb. Treat any figures as illustrative ranges that vary by region, spec and scope, and always confirm against current local quotes.

Kitchen: a new kitchen covers units, worktops, sink and tap, appliances, tiling or splashback, flooring and the labour to fit it, plus any plumbing and electrical changes. It is one of the two biggest single rooms in most refurbs and is very easy to underprice, especially once you add appliances and a decent worktop.

Bathroom: a new bathroom covers the suite (bath, basin, WC), shower, tiling, flooring, extractor and the plumbing and tiling labour, which is the bulk of the cost. Moving the layout, adding a second bathroom or an en-suite increases first-fix plumbing and waste runs and pushes the price up sharply.

Flooring: price by room or by area, separating carpet, laminate or engineered wood, vinyl or LVT, and tiling, including underlay, screed or levelling and fitting. Heavy traffic and wet areas need the right product, not the cheapest.

Plastering: skim over sound walls is cheap per square metre; hacking off and re-plastering, or boarding and skimming, is much more. A whole-house replaster is a major line and is frequently underestimated.

Rewire: a full rewire includes new cabling, sockets, switches, a new consumer unit and the certification, plus the making-good and redecoration afterwards, which people forget. A partial rewire or just a new board is cheaper but still needs a qualified electrician and certificate.

Boiler and heating: a new combi or system boiler, or a full heating system with radiators and pipework where none exists, is a significant line. Always include the gas safety and commissioning.

Windows and doors: replacement double glazing is priced per opening and varies with size, material (uPVC versus timber or aluminium) and whether the property is listed or in a conservation area, which can force a more expensive specification.

Decoration: preparation, painting walls, ceilings and woodwork, and the materials. Whole-house decoration after first and second fix is a real and recurring cost, not a rounding error.

Garden and external: clearance, fencing, paths, patios, turfing or landscaping, plus external decoration and any render or roofing repairs. Where a property has several garden or facade photos, price the distinct jobs you can see and avoid double-counting the same feature shown from two angles.

Structural: underpinning, removing or inserting walls with steels, roof structure, major damp-proofing and subsidence works belong here. These need a structural engineer and often building control sign-off, and they carry the most cost uncertainty of anything on the list.

It helps to put every deal into one of three broad bands, because the band drives both your costs and your risk.

A light refresh is cosmetic. The property is sound and the kitchen, bathroom, heating and electrics work, so you are looking at decoration, new flooring, minor repairs and a tidy-up. It is the cheapest and fastest band, the easiest to price from photos, and the lowest risk because little is hidden.

A full refurb replaces the major elements: new kitchen, new bathroom, full redecoration and flooring, often a rewire and a new boiler, and replastering where needed. This is the bread and butter of most buy-to-let and flip projects. It carries moderate risk because once trades open up walls, floors and the consumer unit, surprises appear.

A heavy or structural project changes the building: layout changes with steels, extensions or loft conversions, re-roofing, underpinning, damp and timber treatment, and tanking. This band has the highest cost, the longest timeline and by far the most uncertainty, which is why your contingency and your professional fees both need to be larger here. If you are new to refurbs, be very cautious pricing a heavy project from photos alone.

Your itemised total is not your final number. Three things sit on top of it, and leaving them out is how estimates that looked fine on the spreadsheet blow up on site.

Contingency. You add a contingency because you cannot see everything from photos and because even a full survey misses things behind walls and under floors. A contingency of around 10 to 15 percent of the works is a common rule of thumb. Use the lower end for a clean light refresh where little is hidden, and the higher end (or more) for an older property or a heavy structural job where the unknowns are larger. The contingency is not padding you hope to keep, it is the budget for the problems you have not found yet.

VAT. Most refurbishment labour and materials on a standard residential property are charged at the standard rate of VAT (20 percent at the time of writing). There are important exceptions: work to a dwelling that has been empty for two years or more can qualify for a reduced rate of 5 percent, and some conversions (for example a single house into flats, or a non-residential building into dwellings) can also qualify for 5 percent. New build can be zero-rated in defined cases. Because the rate genuinely changes the number, always be clear whether a figure is shown with or without VAT, and ideally show both. A materials price from a merchant usually excludes VAT; a builder's quote usually includes it. Mixing the two is a classic and expensive mistake.

Professional fees and overheads. Beyond the trades you have architect or designer fees on bigger jobs, structural engineer fees, building control and planning fees, a party wall surveyor where relevant, and your own project management or a main contractor's overhead and profit. On the works themselves, do not forget the preliminaries: skips and waste removal, scaffolding, welfare and site setup, tool and plant hire, and the cost of getting trades to and from site. Prelims are routinely left out of first estimates and they are not small.

When you present the number, lenders, JV partners and your own model all want the same thing: a clear total, broken into the works, the contingency, the fees and prelims, the VAT treatment stated, and a figure shown both with and without VAT. A tool such as PropVisions can build that itemised, VAT-aware breakdown from the listing automatically, but the logic is exactly what this guide describes and you should understand it whether or not you use software to speed it up.