Investor Resources
What Should Be in Your Rehab Budget? A Line-Item Breakdown
July 26, 2026
Short answer: A lender-ready rehab budget breaks every dollar into a specific line item with a description of exactly what’s being done — not a single lump-sum estimate.
Why the detail matters
Underwriting isn’t just checking that your total makes sense — it’s checking that each line item makes sense for the property, the scope, and the market. A budget that lists a gas stove installation on a property with no gas hookup, for example, will get flagged. Vague line items (“kitchen: $15,000”) without a description of what’s being replaced or installed will typically get sent back for more detail before an appraisal can even be ordered.
The typical budget categories
A detailed rehab budget is usually organized by category, each broken into individual line items:
- Permits & soft costs — building, electrical, plumbing, roof permits; plans and architect fees
- Demo — interior and exterior demolition
- Exterior — roof, siding, paint, gutters, windows, doors
- Interior — drywall, electrical (rough and finish), plumbing (rough and finish), HVAC, insulation, flooring, paint
- Kitchen — cabinets, counters, appliances, backsplash, fixtures
- Bathrooms — tub/shower, vanity, toilet, flooring, fixtures (typically budgeted per bathroom)
- Site work & landscaping — driveway, fencing, grading, landscaping
- Miscellaneous & contingency — a contingency line (commonly around 10%) to absorb the unexpected
Hard costs vs. soft costs
Budgets typically separate hard costs (actual construction materials and labor) from soft costs (permits, architectural plans, engineering reports) — both get financed, but they’re tracked differently for draw purposes.
A tip that saves time later
For each line item, describe what specifically is being done — materials, quantities, and method, not just a category name. “New asphalt shingle roof, 1,200 SF, tear-off and replace” moves through underwriting a lot faster than “Roof: $8,000.”
Ready to size your project?
Run your purchase price and rehab budget through the calculator to see an estimated loan amount once your budget is put together.