NYC Renovation Costs: How Do You Know When It’s Worth It?

Maybe you’re sick of staring at that plain old bathroom tile, or that wall without a window, or you can’t stop thinking about how your kitchen would look with new cupboards. Renovating your home is part of being a homeowner. Whether you want to adapt to a new lifestyle, keep up with the latest interior design trends, or just try something new, we’re here to help you determine your NYC renovation costs and how to know whether the juice is worth the squeeze.

NYC Renovation Costs: How Do You Know When It’s Worth It?

In NYC, renovation costs can add up in no time. It’s hard to know when that new change you’re after is worth the money it requires — or the potential stress. It’s easier to make your decision once you’ve done some research, so let’s break down how much you can expect to pay in NYC renovation costs, and what to factor into your thought process.

The three main types of NYC renovations

First, let’s break down the different categories your potential project could fall under. There are typically three types of renovations that homeowners take on: gut renovations, partial renovations, and cosmetic renovations.

Gut renovations

These are usually the most intense renovations, and therefore, the most expensive. Gut renovations often require stripping down an interior to its studs. That means taking down drywall, cabinets, plumbing, and heating, often to make room for a layout change. Some examples of a gut renovation could include adding a second bedroom, knocking down a wall, or fully replacing plumbing or electrical systems.

Partial renovations

Partial renovations are less involved than gut renovations because they only focus on one or two spaces in your home. So instead of changing the layout of your apartment, you’d only be changing the kitchen. Maybe you’re replacing its floor, changing the cabinets, and upgrading an appliance or two. Most partial renovations in NYC include the kitchen since it’s where most people tend to socialize and makes a big difference to your property value (more on that later!).

Cosmetic renovations

Cosmetic renovations are, of course, the lightest touch of the three, and typically much less expensive. These are all the upgrades homeowners can usually make on their own without the help of a hired hand. Cosmetic upgrades include painting, changing fixtures, or adding shelving.

Average NYC renovation costs

Home renovation costs depend on two major factors: how much square footage is involved, and what kinds of materials you want to use. Obviously, the higher quality your materials and the more space you want to renovate, the higher your cost is going to be.

Generally, the common rule of thumb for any NYC renovation is $100 – $200 per square foot of space, which includes labor and basic materials. If you want higher end finishes and materials, you can expect to spend something in the $200 – $400 range. If you’re really particular, as in, you need a very specific marble tile that can only be imported from Spain, you could be looking at around $800 per square foot. It all depends on what you want, and what you’re willing to spend to get it.

The average range of $100 to $200 could have you scratching your head thinking, where do I land within that? Well, it depends on what kind of renovation you’re doing. If you’re breaking down walls with a gut renovation, you’ll be looking at the higher end of $200 per square foot. If you want a partial renovation, or cosmetic renovation, you can plan to stay safely around $100 per square foot or less.

Let’s use a 700-square-foot one-bedroom apartment as an example. A gut renovation can easily clear $100,000 for this space, possibly adding up to $140,000. However, if you keep the layout and systems as they are, this renovation could be just $100 per square foot, totalling $70,000.

Tip: Don’t forget about construction permits! These are required to do the work of a renovation regardless of the kind of property you own. In NYC, the average plumbing permit ranges from $2,000 to $5,000, and an electrical permit is around $900.

How to Make Your Renovation Budget

Verify the square footage of the space

Get out the measuring tape! Knowing the square footage of the project you’re considering will make all of your decision-making 100% easier.

Choose the type of renovation

Maybe you just want to start with some cosmetic changes, like new lighting. Or maybe you want to add a backsplash through a partial renovation. Decide ahead of time if the renovation will include gutting the space or not.

Think about materials

You don’t have to decide on specific materials ahead of time, because your contractor will likely discuss that with you. But for now, simply make a choice of how customized you want to get in the supplies you use — is a basic wood okay for that surface, or do you want it to be walnut or teak in particular? Knowing your material preferences ahead of time will help you gauge how much you’ll need to pay for them.

Play with the numbers

Once you add up those three elements, you can play around with the numbers and see where you can ease up or dig in more. Maybe you want a gut renovation and you can be flexible by using more run-of-the-mill materials. Or, maybe you’re just going for a partial renovation but you have a specific look in mind for the materials used. Play around until you find a budget that makes sense with your goals.

Don’t forget to arrange approval from your condo or co-op board

Many New York City renovations require something you won’t find in most other cities: approval from a co-op or condo board. When you share the building with other residents, you probably can’t knock down a wall without getting their permission first. This approval process can take several months and depends what kind of building you live in, so it’s definitely something to look into before pouring money into a renovation.

Here are a few things your condo or co-op board may require from you in order to approve your renovation:

• Liability insurance
• Licensed professional laborers, which can translate to a higher cost in labor
• A strict schedule in which the work can be done
• Permission from neighbors and building staff
• Required updates to plumbing or electrical
• Late fees if the renovation takes longer than its projected end date

How do you know when a renovation is worth it?

This is the question in every homeowner’s mind as they set out to make changes to their property. The truth is, any renovation that feels like it will improve your life, even when you consider all of the cost and stress it can come with, is probably worth it. That’s something only you can figure out based on your needs, goals, and long-term plan for the home.

Are you planning to stay in this space for several years, or maybe ten years, or forever? The investment of NYC renovation costs becomes more worthwhile the longer you’re planning to be there. If the renovation aligns with your lifestyle and adds to your long-term gain in property value, then it’s probably a good idea.

Next, ask yourself if there’s anything the property truly needs. Maybe you keep thinking about a new kitchen when there are serious structural or electrical issues that are more important and urgent. If your property is in an old building, that can be a huge factor in calculating NYC renovation costs and making the decision to renovate.

Then, research your area. Do the homes with upgrades have a higher property value or asking price? Is there a demand for a certain kind of renovation? The NYC market is complex, and understanding what’s going to enhance your home best is key to knowing whether an upcoming renovation is worth it. Ask a NewDevRev expert what they think, since they have the real estate expertise to know what’s sought after in today’s market.

How renovations affect property value

Many homeowners like to follow the rule of thumb that any renovation they take on should only increase their property’s value, not lessen it. That way, if you choose to sell your home, you know that the money you sank into that renovation will come back to you by increasing your potential asking price.

To help you figure that out, here’s a list of the renovations that help (and hurt) your home value:

Renovations that add value to your property:

• Kitchen upgrades of any kind, from cosmetic to gut renovations
• Bathroom upgrades of any kind, from cosmetic to gut renovations
• Refinishing hardwood floors
• New insulation
• Converting an attic space
• Closet renovation
• Adding a bathroom

Renovations that lower your home’s property value:

• Over-personalization of tiles, lighting, and decor
• Removing a bedroom
• Removing a bathroom
• Adding carpeting
• Removing closets
• Garage conversions
• Adding a swimming pool or hot tub

Who do you talk to about your NYC renovation costs and plans?

Chances are, you want a second opinion on whether to renovate before making any big decisions. Ask for advice from your network — do you know any other homeowners who have benefited (or regretted) their renovations?

It can also help to schedule some introductory conversations with contractors to see what they’ll need to do the work, and answer some of the open questions around how much your NYC renovation will cost.

If you want the opinion of a real estate expert to make sure your renovation is worth it, reach out to the NewDevRev team. On top of being experienced NYC homeowners ourselves, we can help you calculate the increase in property value that your renovation can bring and connect you with resources from our wide-reaching NYC network.

Ultimately, the answer to whether your NYC home renovation is worth it depends on your personal evaluation of all the factors laid out above, from long-term planning, to property value, to your budget. With a little research and a lot of thought, you’ll know exactly what’s best for you and your home.