Why I Founded Realm

Because once I started investing in real estate, I thought it was crazy that homeowners didn’t have access to the same information as investors.

I’ve always liked real estate. Growing up, we rented a home in central NJ, but when I turned 6 my parents had saved up enough to become homeowners. We had to move further away from New York City, but my dad never complained once about the 2 hour (each way) commute he had for 20+ years.

So many of my memories revolve around our South Jersey home where my parents live to this day. Getting to pick the paint color for the computer room. Partially finishing the basement so I had somewhere to dance to TLC and have sleepovers. Redoing my room on a $1,600 budget, which I planned down to the cent to self-install hardwood floors, apply fresh paint, and upgrade to a double bed.

Liz and her sister in front of their childhood home in South Jersey

Our home was not only at the center of most of my memories, but was also at the center of my parent’s finances. They taught me that credit cards often aren’t the best way to borrow money and that you can get better rates with a home equity loan. They agonized over renovating the dark kitchen that was trendy in 1998, but not part of the dreamy modern kitchens that became popular a few years ago. They loved to speculate on our home’s value when a neighbor’s house sold—“We have a better lot, but they built that two-level deck. Maybe they’re worth the same? Should we build a deck?”

My personal real estate adventure accelerated when I started working at Reonomy, a real estate tech company helping commercial investors better understand big properties. As I learned more through my day job, I started to invest some of my personal savings into commercial properties across the country. Along with my husband and a few friends, we’ve purchased 34 properties since 2016. We’d buy one property, improve it, refinance it, and pull money out to buy the next. After 3 years, we’ve turned a few hundred thousand dollars into a portfolio worth millions. But we’ve always relied on an information advantage—a tip from a professional or a local data point that made us confident that each property would be a good investment.

Liz onsite at a manufactured housing factory in California

With each additional investment I made, I kept asking myself: “Why doesn’t every American homeowner have access to the same information as a real estate investor, a commercial real estate developer, or a seasoned house flipper?” The average American homeowner has 62% of their assets tied up in their property, yet there is no resource to help treat a home as an asset. 

After obsessing over this question for 3 years, I became so convicted that Realm should exist that I decided to build it myself. 

Day 1 at the first Realm office

I founded Realm in 2019 to give homeowners access to data and insights to help them take advantage of their property’s full potential. After 14 months of hard work and a little luck along the way, I’m thrilled to announce Realm is now available to 63M single-family homes across all 50 states.

This is just the beginning. Our team is hard at work expanding coverage to additional geographies and building new data sets to make our insights and advice even more personalized to you and your home. 

Create an account to view your property analysis today.

Why is getting good data on home projects so hard?

Our first installment of Home Projects 101: A how-to guide for people who are unsure about projects

You recently bought a house. For the first time, you have the ability to change anything you want about the space you live in which is liberating, but also overwhelming. All you can see is projects.

You have no idea how much anything should cost or who to call for which project. It’s easy to spend endless hours Googling “how much should a kitchen renovation cost?” and “who do I call to install marble countertops?” and “are marble countertops worth the investment?” only to find yourself with more questions than answers.

Sound familiar? We want to help.

In this post we will cover:

  • What local expert advice is good for, and what it’s not
  • Why finding good data to inform home projects used to be impossible
  • How Realm can help you become a knowledgeable homeowner

What local expert advice is good for, and what it’s not

One of the things that is challenging as a new homeowner is discerning between good advice and bad advice. You are reliant on all kinds of professionals that you have no prior experience with – from contractors to realtors to mortgage brokers. Although most of these people are well intentioned, they all come at it from their own lens. As one of our customers aptly summed up:

“Whenever we talk to contractors or our realtor, or even our parents, people who are well-meaning in our lives, everyone kind of has their own agenda in terms of what they think you should tackle first and where you should put your money.” 

That’s not to say that local expert advice is bad. In fact, it can be quite useful, especially when paired with unbiased data & analysis.

Use local experts for

  • Cosmetic trends — what types of curb appeal are paying off in the local area
  • Implementation advice — how to design & execute a renovation project without going crazy
  • Project timelines —how long a project will take to complete given the specifics of the plans and vendor availability in your market

Use Realm’s unbiased data for

  • Home value trends — which attributes of a home drives value up or down in your neighborhood
  • Project ROI — estimates for how much a medium- to large-scale renovation will impact your home value
  • Fair project pricing — expectations on what a project should cost in your area based on local labor & material costs

Why finding good data to inform home projects used to be impossible

In order to provide an accurate estimate of how much a project will cost you and how it will impact your home value, it’s necessary to understand the current state of your home, the cost of labor & materials in your area, and what’s happening with homes & recent projects nearby. This has traditionally been challenging for two reasons:

  1. Data is non-standardized, hard to collect, and privately held.

Real estate data is challenging to aggregate for the average person and even for the average company for many reasons, a few of those being:

  • Local government offices: each city and sometimes county has different rules and processes for collecting public real estate data including your tax assessed home value, building permits for construction projects, and 
  • Fragmented contractor networks: over 700,000 construction firms set pricing on renovation projects, meaning quotes come in many different formats and 
  • Multiple Listing Service (MLS): the gold mine of real estate data is only available to licensed real estate agents (aka it’s not open to the public)
  1. Every home & neighborhood has its own unique characteristics

Unlike the stock market which balances out supply and demand at a global scale, real estate is a localized market. Building styles, techniques and codes have changed over time. Understanding these factors can significantly change the cost of the same project from one house to another. To properly assess what attributes of a home drive up value, it’s critical to understand the market at a micro level. 

Using data to answer this question used to be impossible. 20 years ago, advanced data science techniques didn’t exist. 10 years ago, things like natural language processing and boosted tree models were just getting off the ground. We won’t bore you with the details, but it’s safe to say that the advances made in geospatial data science, image processing techniques, and neural network models have changed the game. 

We’ve spent the last 2 years aggregating hundreds of unique data points for each home, including things like recent building permits filed, buildable square feet, bedroom / bathroom ratio, and quality of appliances. Through partnerships with public and private data providers as well as through our own manual data collections efforts, we’ve built the first centralized real estate database that houses all the information required to give homeowners like you access to quality data.

But that’s enough about data science — how does this help you? 

How Realm can help you become a knowledgeable homeowner

Realm’s mission is to democratize access to all the real estate data that professional investors have had access to for decades.

That’s why we made our property plan free to all single-family homeowners across the US (view a demo). Start by entering your address and creating a free account. Then, add and customize projects to see your property-specific ROI estimates for each one. 

There’s personal value in making your space more liveable and financial value in the resulting increase in home value. Ultimately, how you trade off between those two dimensions is totally up to you and our goal is to ensure you have the data ahead of time to be able to confidently make those trade offs

The data is only one part of the solution, however. We know that navigating which professionals are needed for various projects and figuring out how to find quality, reliable professionals at a fair price are tedious parts of becoming a homeowner. 

Over the next 6 weeks, we will be releasing a new series: Home Projects 101: A how-to guide for people who are unsure about projects. This series will help you become a more confident & savvy homeowner as you navigate renovation projects & maintenance on your home:

Part 1: Who does what in the home economy

  • Before the project
  • During the project
  • Ongoing repairs & maintenance

Part 2: How to prepare to source & select a home professional

  • General contractor
  • Architect
  • Refinancing lender

Anything else you want us to cover? Let us know in the comments below.

Realm’s Guide to Home Additions

It’s not always up to you where and what you can build on the property that you own.

If you need to make more space for your growing family — whether that’s more kids on the way or parents moving in with you — you may find yourself weighing the pros and cons of adding more space to your current home versus upgrading to a larger home.  Here’s what you need to consider:

  1. Compare cost per square foot to build versus buy in your area
  2. Evaluate your timeline
  3. Learn where you can build
  4. Weigh the cost and value implications of each option

We explain each of these factors in detail below.

1. Compare cost per square foot to build versus buy in your area

If you live in a smaller house in a high-value area, it’s likely that it will be cheaper to add on square footage to your existing home rather than purchase a larger one. 

For example, San Mateo County (Bay Area) is one of the most expensive counties to buy a single family home. The cost per square foot to buy is 340% more expensive than the $ / sqft to build. Look up the stats in your county.

2. Evaluate your timeline

Living in your home during ongoing construction isn’t fun. If you’re going the addition route, keep in mind that their timelines can vary. Most additions are impacted by:

  • Time to receive your building permit in your city
  • The size and type of the addition (rooms with plumbing are more time consuming to construct than those without)
  • The design and shape of the roof, since it impacts how easily the new roof can be attached to your existing roof

On the other hand, keep in mind that selling one property and buying another typically takes about six months.

3. Learn where you can build

The most important things for you to know are in the order of least restrictive to most restrictive:

  • Setbacks — The minimum distance which the home must be set back from the lot line. These are often highest for the front of the property, and in most neighborhoods, building an addition on the front of your property is not allowed.
  • Lot coverage — The percentage of the lot that is allowed to be covered by the home. This impacts how much space you can add on the 1st floor, garage, and backyard home.
  • FAR — The ratio of a building’s total square feet to the size of the parcel. This is inclusive of square footage on all stories of the home and thus can impact how much space you can add on the 1st and/or 2nd floors.
  • HOA rules —  If your property is part of a homeowners association, there may be additional restrictions on what you can build. Most often, HOA rules have to do with the exterior style of the home and maintaining curb appeal, but many HOAs require approval on any construction project that you want to undertake.

Each city has different restrictions. In some areas, all four of the following restrictions apply but in other you might only be dealing with setbacks. Here are two similar sized lots with different zoning restrictions which impact each homeowner’s ability to add square feet.

Sherman Oaks
Portland, ORSherman Oaks, CA
Current Sqft 1,1821,914
SetbacksFront – 10f
Side – 5ft
Rear – 5ft
Front – 20ft
Side – 5ft
Rear – 15 ft
Lot CoverageMax 2,480 sqftn/a
Portland – More area available to build out based on setbacks
Sherman Oaks – Limited area to extend the home out based available based on setbacks

4. Weigh the cost and value implications of each option

There are 4 ways to add space: 1st floor addition, 2nd floor addition, garage conversion, and building an ADU. Based on what’s allowed you may be able to pursue any of the 4 options or will be limited to a couple of options. 

Here’s the analysis Realm provided for each of the above properties.

The Portland home has smaller setbacks and is only restricted by lot coverage, whereas the Sherman Oaks home has larger setbacks and is has a more stringent restriction of floor area coverage (FAR) — meaning that adding square feet on the 2nd floor also counts towards the zoning restriction. On the other hand, the Portland home is not allowed any ADU units whereas the Sherman Oak home is allowed both 1 ADU and 1 junior ADU.

Portland, OR home – The lot has space for a 700 sq-ft addition or the option to convert the garage. Both projects are strong ROI, but the home addition has the added benefit of create incremental space and preserving the garage.

ProjectCost of ProjectROI%Home Increase
Home Addition –700 sq-ft$99,500 – $121,610207%$228,999
Garage Conversion – Detached$64,350 – $78,650208%$148,653

Sherman Oaks, CA home – Although the lot is zoned for a backyard home, there is not enough space left given setbacks to add one. This home only has space for a 360 sqft addition due to setbacks & FAR restrictions, or the option to convert the garage as is or with an extension.

ProjectCost of ProjectROI%Home Increase
Home Addition360 sq-ft$140,100 – $171,240210%$327,312
Garage Conversion$63,051 – $77,062292%$204,495
Garage Conversion + 150 Extension$98,998 – $120,998244%$268,580

If you’re considering a home addition, check out the free cost & ROI estimates within your dashboard. If you’re also looking for detailed zoning analysis, recommendations on vendors, and a more precise ROI estimate based on detailed comps analysis, consider our $99 project planner report.

Buy vs. Build

Use Realm’s cost per square foot index to determine if it is better to buy vs build in your county. It is more expensive to buy than to build in counties with ratios > 100%.

StateCounty NameSample SizeBuildBuyRatio
CA San Francisco $302 $1,061 352%
CA San Mateo $297 $1,008 340%
CA Santa Clara $285 $803 281%
DC District of Columbia $226 $618 273%
VA Arlington $220 $559 254%
FL Monroe $203 $513 252%
CA Santa Barbara $256 $634 248%
MA Suffolk $236 $538 228%
HI Maui $233 $508 218%
CA Alameda $286 $616 215%
HI Honolulu $277 $571 206%
VA Alexandria city $222 $452 204%
NY Kings $308 $592 192%
CA Los Angeles $256 $486 190%
CA Orange $257 $477 185%
CA Monterey $271 $489 181%
CA San Diego $257 $445 174%
NY Queens $307 $518 168%
CA Contra Costa $285 $479 168%
VA Fairfax $219 $357 163%
CA Ventura $260 $417 161%
CA San Luis Obispo $258 $408 158%
MA Norfolk $228 $341 150%
OR Multnomah $243 $364 150%
RI Newport $197 $293 149%
MA Middlesex $230 $336 146%
MA Barnstable $228 $328 144%
CO Garfield $210 $288 137%
NY Nassau $285 $378 132%
FL Miami-Dade $203 $260 128%
CO La Plata $209 $263 126%
MI Washtenaw $201 $252 125%
MA Essex $243 $301 124%
MA Plymouth $219 $272 124%
CO Jefferson $213 $263 124%
AZ Coconino $212 $260 123%
NJ Cape May $215 $254 118%
NJ Monmouth $214 $251 117%
FL Collier $200 $232 116%
OR Deschutes $240 $277 116%
VA Loudoun $226 $259 114%
SC Charleston $204 $230 113%
NJ Somerset $215 $241 112%
NJ Morris $207 $231 112%
MA Bristol $210 $232 110%
NC Buncombe $199 $218 110%
NV Carson City $227 $245 108%
AZ Yavapai $209 $225 108%
NJ Middlesex $225 $241 107%
FL Broward $205 $217 106%
NJ Essex $217 $228 105%
NJ Passaic $223 $235 105%
FL Pinellas $204 $214 105%
OR Lane $242 $252 104%
CT Fairfield $227 $235 104%
VA Albemarle $212 $218 103%
OR Yamhill $243 $250 103%
CA San Bernardino $255 $260 102%
FL Palm Beach $200 $205 102%
NJ Union $243 $245 101%
WA Clark $246 $249 101%
AZ Maricopa $208 $206 99%
NY Rockland $253 $248 98%
TN Davidson $212 $206 97%
CA Riverside $256 $246 96%
SC Beaufort $199 $188 95%
MI Ottawa $210 $197 94%
VA Richmond city $212 $198 94%
OR Marion $243 $228 94%
OR Jackson $239 $223 93%
GA Fulton $213 $193 91%
AZ Navajo $207 $187 90%
MD Charles $218 $196 90%
CO Pueblo $211 $187 89%
MA Worcester $236 $206 87%
MD Harford $223 $195 87%
GA DeKalb $213 $185 87%
FL Seminole $202 $175 86%
NJ Ocean $228 $197 86%
VA Culpeper $218 $186 85%
WA Franklin $230 $196 85%
RI Providence $218 $184 85%
NJ Mercer $233 $196 84%
FL Lee $200 $167 84%
FL Manatee $221 $185 83%
NC Mecklenburg $208 $167 80%
FL Hillsborough $203 $163 80%
AZ Pima $205 $165 80%
CT Middlesex $211 $167 79%
FL St. Lucie $200 $155 77%
NJ Sussex $195 $150 77%
CA Fresno $263 $201 76%
CT Litchfield $199 $152 76%
MN Hennepin $251 $191 76%
NV Clark $248 $189 76%
CA Merced $267 $201 75%
MI Oakland $225 $170 75%
IA Polk $223 $168 75%
NJ Warren $201 $149 74%
OH Franklin $219 $163 74%
FL Lake $203 $150 74%
WA Yakima $244 $180 73%
MA Hampshire $277 $202 73%
NJ Hunterdon $266 $192 72%
MA Franklin $235 $166 71%
CA Tulare $258 $182 71%
GA Hall $198 $139 70%
PA Lancaster $225 $158 70%
GA Cobb $213 $149 70%
CA Kern $255 $178 70%
AZ Mohave $219 $153 70%
MN Ramsey $253 $176 70%
CT New London $226 $157 70%
FL Clay $201 $139 69%
MI Kalamazoo $211 $145 69%
CT New Haven $230 $158 69%
FL Polk $201 $137 68%
MN Washington $253 $169 67%
SC Greenville $205 $134 65%
CT Windham $240 $157 65%
MA Berkshire $253 $165 65%
NJ Gloucester $214 $140 65%
NC Forsyth $203 $131 65%
NC Gaston $208 $134 65%
OH Licking $219 $140 64%
OH Clermont $217 $137 63%
OH Hamilton $212 $134 63%
FL Hernando $203 $128 63%
SC Pickens $213 $134 63%
OR Klamath $238 $150 63%
FL Escambia $205 $129 63%
NY Dutchess $266 $167 63%
NC Guilford $203 $127 63%
WI Kenosha $241 $150 62%
MA Hampden $281 $174 62%
PA Washington $233 $144 62%
CT Tolland $239 $147 61%
MI Wayne $234 $140 60%
MN Wright $251 $149 59%
CT Hartford $261 $152 58%
MO St. Louis $237 $137 58%
AZ Cochise $233 $134 57%
SC Spartanburg $205 $118 57%
IN Tippecanoe $212 $121 57%
PA Westmoreland $233 $133 57%
NY Erie $247 $140 57%
SC Aiken $201 $114 57%
NC Harnett $202 $115 57%
AR Pulaski $196 $111 57%
OH Wood $223 $124 55%
PA Dauphin $231 $127 55%
SC Florence $202 $108 53%
OH Montgomery $210 $106 50%
IN Marion $215 $107 50%
OH Clark $210 $104 50%
IL McHenry $269 $133 49%
IN Bartholomew $212 $104 49%
NY Clinton $226 $111 49%
OH Lorain $217 $102 47%
WI Sheboygan $244 $113 46%
GA Richmond $206 $94 46%
AL Montgomery $207 $91 44%
NY Onondaga $236 $104 44%
PA Luzerne $226 $98 43%
IL Madison $237 $100 42%
MI Genesee $222 $93 42%
GA Bibb $206 $84 41%
IL Peoria $242 $95 39%
IL St. Clair $237 $92 39%
IN Madison $213 $83 39%
NY Broome $234 $79 34%
NY Cattaraugus $247 $77 31%

Note: we only include counties with enough data to have a significant sample size for this calculation.

If you live in an area where it is cheaper to build vs. buy, check out our guide to home additions and learn more about how much you can build and at what cost at myrealm.co.

How to use Zillow + Realm to outsmart other homebuyers

If you’re actively looking for a house, you know that the market is unpredictable right now. Outsmart other homebuyers by finding overlooked, high-potential properties. 

With supply at an all-time low and home prices rising across the country, winning a bid on your ideal home while staying within your budget may feel impossible. Instead of competing with dozens of other buyers on a recently renovated home with immaculate finishes, consider buying a property that doesn’t meet all of your current criteria — one with a lot of potential that could meet your criteria within a few years of moving in. These properties will be less competitive, more customizable, and often offer a better deal. 

Your first step: Decide if buying a house that needs some improvements is right for you. You can go for a total fixer upper — something that needs more space and renovated kitchens & bathrooms — or look for something in between.

Next up: use Zillow and Realm to search for high-potential properties.

1 – Make a list of your must haves

Think through what your ideal property looks like in 2-3 years from now. Consider the following categories:

How large does it need to be?
– Bedrooms
– Bathrooms
– Home office and/or gym space
– Living space

Which style elements are most important to you?
– Look and feel of the neighborhood
– Exterior style
– Kitchen & bathroom style
– Flooring

What amenities does it need to have?
– Spaces for entertaining
– Backyard features
– Garage

What location is ideal for you?
– Commute time
– School districts
– Walkability / public transportation

2 – Build your target list

  • Use Zillow to search for the properties that check the boxes from your must haves. Only focus on the variables you cannot change. This includes:
  1. Location
  2. Lot size
  3. Price

Leave the filters for things you can change blank, because you’ll use Realm to assess what changes are possible. This includes:

  1. Bedrooms
  2. Bathrooms 
  3. Square feet
  4. Quality of finishes
  5. Amenities (Pool, Garage, etc)

For example, if you’re looking for a 4 bed/3 bath in the Denver neighborhoods of Platt Park & Washington Park, you’ll need a budget of $900k-$1M for something like this property:

845 S Pennsylvania St, Denver, CO 80209

For sale: $950,000

4 bd/3 ba

2,318 square feet

0.11 acre lot

If you filter on Zillow for similar lot sizes, but at a lower price range of $600-700k knowing that you’ll invest $100-250k into upgrades, you’ll find several more properties available on similar lot sizes.

732 S York St
For sale: $700,000
1,613 sqft
3 bed/2 bath
0.11 acre lot

985 S Emerson St
For sale: $699,000
1,213 sqft
3 bed/2 bath
0.11 acre lot

1325 S Sherman St
For sale: $660,000
1,340 sqft
2 bed/2 bath
0.07 acre lot

1335 S Pearl St
For sale: $635,000
1,353 sqft
3 bed/2 bath
0.09 acre lot

  1. 3 – Get familiar with potential value

Once you have your target list ready, look up what’s possible on each of these properties so you’ll know which ones can eventually meet your must have criteria. Realm will show you:

  • Untapped potential – how much the property could be worth after various upgrades
  • Buildable square feet – how many square feet you can add on the property and how many bedrooms and bathrooms you can add within local zoning restrictions

For example, the 985 S Emerson Street property has 1,339 additional square feet allowed and is zoned for a 1st or 2nd floor addition and/or a backyard home.

Example of Realm Dashboard – 985 S Emerson St

4 – Research ROI on top projects

Save all of your target properties to your Realm account and start exploring the property plan for each home to gather cost and value estimates of top projects at the top of the list.

For the 4 Denver properties identified, each has enough buildable square feet to add an additional bedroom and bathroom. 985 S Emerson also needs additional living space and 1335 S Pearl could use a kitchen renovation.

PropertyListing PriceUpgradesCostFuture Value
845 Penn.$950kn/a$950k
732 York$700k1 bd/bath addition$100k$941k
985 Emerson$699kLiving space + 1bd/bath addition$268k$1.09M
1325 Sherman$660k2 bd/1 bath addition$140k$1.03M
1335 S Pearl$635kKitchen reno + 1 bd/bath addition$150k$879k

Based on Realm’s cost & value estimates, 1325 S Sherman St is the best deal:

  • $660,000 list price
  • + $140,000 for a 2 bed/1 bath addition
  • $839,000 all in cost
  • With a $1,026,000 estimated future value, that’s a +$187,000 ROI and is $111,000 than buying a 4 bed/3 bath out of the gate.

5 – Complete your due diligence

Once you’ve found a property or two that you’re serious about, you’ll want to gather detailed information on what you’re allowed to build on the property and what previous work has been done so you can feel confident you’re buying a home with good bones.

Consider our Optimized Home Value Report which includes:

  • Optimized home state – what combination of projects will help you increase value the most
  • Physical property study – what you can build including setback and zoning analysis
  • Previous work assessment – record of all building permits on file for the property
  • Comps – neighborhood analysis including 3 most similar homes and 3 comparable lots

Curious to learn more about this report? Check out this sample.

Start researching properties in your city at myrealm.co and let us know how it goes. Either drop a note in the comments below or send us an email at learn@myrealm.co

7 ways to cut costs without sacrificing quality

  1. Buy cheaper base cabinets from Ikea and add fancier doors from Semihandmade
  2. Buy countertops direct from local marble & tile places
  3. Skip the architect for simpler projects. We like the Ikea Planning Tool because they’ll even send someone to your house to measure out your cabinets.
  4. Instead of a tiled backsplash use a peel & stick wallpaper
  5. Update your cabinet knobs with hardware from CB2 or Anthropologie (or DIY your own knobs)
  6. Do some of the labor yourself or find a friend to help you
  7. Source your own lighting from Target, Wayfair, or Overstock and DIY install

Get started by visiting your Realm dashboard to look up how much renovating your kitchen will improve home value and what your project is estimated to cost.

Back to Realm’s Guide to Kitchen Renovations

Realm’s Guide to Kitchen Renovations

Kitchen renovations are a common project because kitchen style becomes outdated about every 10 years.

We were curious to see where kitchen renovations were the most popular across the country. Our permit data shows that they are especially popular in states in the Northeast. In New York state, 20% of homeowners who completed a major home renovation in the last 2 years tackled their kitchens.

Residents of Pennsylvania, Massachusetts, and Tennessee were also hot spots for kitchen renovations, with 12-15% of projects falling into the kitchen category.

Among all homes that have completed a project in the last 2 years, what % completed a kitchen renovation?

What drives ROI?

Renovating a kitchen can be a big undertaking, so it’s important to think through the ROI before getting started. ROI is simply how much your project costs compared to how much your home value will increase. You can view our personalized estimates for cost and home value increase in your Realm Dashboard. Here’s a breakdown of each bucket:

Drivers of cost

There are three categories in a major project: materials, labor, and project management. We also recommend adding 7-10% on top of your base budget to cover unexpected costs that may arise.

  • Materials – 60% of costs
    This includes your cabinets, appliances, countertops, etc. Cabinets are typically the biggest expense, accounting for 50-75% of material costs in a typical project.
  • Labor – 20% of costs
    The average kitchen remodel assumes 180 hours of labor. Labor rates are variable by market and are typically lowest in Texas and South Central states and highest in the Northeast Corridor & California. You should expect labor expenses for installing new cabinets and appliances, tearing down or removing fixtures, and updating plumbing.
  • Project Management – 20% of costs
    You’ll likely want to hire a general contractor to oversee your project, source your labor, and manage all the moving pieces. This is especially important for larger projects where you are changing the size and layout of your kitchen. A big chunk of this expense goes to covering builders insurance in case anything happens on site during your renovation. 

    For smaller renos, you can cut costs by sourcing the labor yourself. However, you should note that you’ll need to file an “owner-builder” permit and be aware that you’re assuming the liability for the project.

Drivers of value

Value comes down to how your kitchen stacks up to comparable homes in your neighborhood. If nearby homes with renovated kitchens are selling for significantly more than those with outdated ones, then you can expect a  sharp increase in home value. There are a couple of features that we look at when evaluating comparable homes:

  • Size
    As with all things in real estate, square footage is a big factor in value. We compare the square footage of your future kitchen to the average size of kitchens of homes in your area. Bigger is not always better — value is dictated based on what is popular not based on extremes.
  • Age
    We compare the value of older homes with renovated kitchens to older homes with outdated kitchens to understand what impact a new kitchen has on value in your area. The newer the average kitchen is in your neighborhood, the more likely you are to see an increase in value after renovating.

Ready to get started?

Step 1: Look up Realm’s personalized ROI calculation for your kitchen renovation
Step 2: Review our 7 steps to kick off your kitchen renovation

Step 3: Get ideas on how to cut costs without sacrificing quality

7 steps to kick off your kitchen renovation

  • 1) Set your budget

As with all projects, there is a wide range in how much you could spend so it’s important to start with how much you can afford. Note: If you have equity in your home, you can consider financing your project using a home equity loan or line of credit.

Map out your costs for materials and labor and decide if you want to hire a contractor. If you want help mapping out categorical pricing for the things you’ll need like finishes, wood and plastics, electrical, installation, or design, check out our Project Planner report

2) Pick your style

Modern, traditional, farmhouse, or something else? If you’re not sure, Pinterest and Houzz are both great places to get ideas. Or, check out a few of our favorite Instagram accounts:

3) Decide on size

What is the size and shape of your kitchen? Consider spaces L-shape, Galley, U-shaped, and more before deciding if you’d like to tear down a wall to make your space more open. We like this guide from Better Home & Garden. Making changes to the size will drive the cost of the project up, but can also improve livability and home value.

4) Outline your kitchen triangle

The kitchen triangle is a tried-and-true design principle for kitchen layouts. It is the point between the three items you use most: your work space, sink and dishwasher, and your cabinet space.

Hone in on how you’ll bring this principle to life in your layout first before diving into all of the other details. Keep in mind that moving appliances around will be more expensive as it will require changes to plumbing.

5) Plan your layout

With the kitchen triangle in place, think through the other details of the layout. Some questions to get you started:

  • Do you want open shelving or all cupboards? 
  • Do you want an island? 
  • How much storage do you need? 
  • Do you want a pantry in the kitchen? 
  • What items do you want on the counter vs in a cabinet? Consider commonly used items like your coffee machine, toaster or toaster oven, microwave, and stand-up mixer.
  • How do you envision your stove? With a range, a hood, a window nearby?
  • Do you want a seating area or bar stools against a counter?

6) Prioritize your expenses

With your draft layout in mind, now it’s time to go back to that original budget and start prioritizing what is most important. Here are a few things to keep in mind:

  • Cabinets – These are usually the biggest change and give you the most ROI. To cut down on costs, consider painting your current cabinets or using less expensive cabinet fronts. Remember to think about open shelving (cheaper) vs closed cabinets (more expensive).   
  • Countertops – Decide on material and price it out. Keep in mind that labor is more expensive than you might think. And if marble is what you want — be wary of maintenance.
  • Appliances – If you can’t afford to go all out with appliances, think about picking one that will be your focal point, for example a sink or a range hood, and go big on that one piece.
  • Tile – If you’re thinking of doing a tile backsplash, know that labor is the most expensive part.   
  • Lighting – You’ll need to plan for more lighting if you have less natural lighting. You have a lot of options when it comes to this: under cabinet, over cabinet, pendants over an island, lighting over a table. 

If you’re on a tight budget, check out our 7 ideas for cutting costs without sacrificing quality.

7) Hire your vendors!

First, decide if you need a General Contractor for your project (see our notes in our kitchen guide on cost vs. benefit tradeoffs). Contractors are good with demo, plumbing, electricity, tile, install, and paint. Then, determine if you need specialist vendors — those will be required if you’re implementing any high-end or unique features in your kitchen such as new hardwood floors or cutting custom countertops.

If you’re in Southern California, let us help you find your vendors to ensure you’re getting the best price and high quality work. Set up a complementary property review with one of our Advisors to get started.

If you’re in other parts of the country, the best way to find vendors is to talk to your neighbors for recommendations. Make sure to verify reviews for recommended contractors with the Better Business Bureau, and ask for references. Always check their references and ask if you can visit or drive by previous projects to determine their work quality.

Get started by visiting your Realm dashboard to look up how much renovating your kitchen will improve home value and what your project is estimated to cost.

Back to Realm’s Guide to Kitchen Renovations