Every remodeling project has two additional steps in the construction process that new construction does not have.
Step 1: We have to un-build the house or you could say we need to deconstruct the house. Unlike taking a wrecking ball to the house or burning the house down, we need to methodically take the house apart getting it just to the right stage of “undoing” where we can take the next step. During this deconstruction time we often make unanticipated discoveries. For example: We could find rotten wall surfaces, missing structural components that were never there in the first place and a host of infrastructural elements that need to get addressed. Finding walls, floors and ceilings that are out of true, out of level and out of square are entirely possible. In your particular house, we could find aspects of all of these components with the basement and foundation being the biggest financial impacts.
Step 2: Once we have deconstructed the house and made our discoveries we need to then “align” the house with all the new things we are putting into it. We have outlined a couple examples we’ve seen over the years: A guest bathroom floor may be so out of level we need to spend $1000 to $2000 additional dollars to make the floor level again. We cannot simply put our finished floor over a faulty floor. Failure of the new floor assembly would soon follow a poorly prepared floor; We may need to adapt new materials whose dimensions fit new homes well but need to be adapted to older homes. In many cases, if we are setting tile in a bathroom, we need to true the walls to be square and plumb otherwise when the tile patterns go up on the walls your eye will track that the bottom tiles are not symmetrical with the top tiles.
These are just a couple of examples of the kind of “alignment” or “reconciliation” that needs to take place on every remodeling project. The more comprehensive the renovation the more parts of the house we are faced with reconciling.
Overall these two factors can make a renovation project significantly more expensive per square foot than a newly constructed house whose constructed assemblies are quality controlled from the start and every assembly builds upon the previous one which was designed specifically for the next pieces that build upon it.
Finally, in every budget there are some line items which represent a significant percentage of the overall project costs. We unimaginatively call them the "big line items” They are generally excavation, roofing, electrical, plumbing, heating/cooling, foundation and fixtures. They can have a significant impact on cost per square foot on both new and remodeled houses.
Some renovation projects do not impact the roof or the exterior or even the plumbing and heating. With these projects the costs per square foot for a renovation are extremely low.
For example, last year we finished a 2,000 SF basement for $20 per square foot. There was little work that involved “the big line items” and per square foot we were not doing more than adding walls, a few built-ins and a nice floor finish. There was no plumbing, no windows, no roof, no heating, no excavation, and very little electrical work.
Likewise, last year we did a full renovation of a home in Burlington which was a 1,300 SF two level house upon which we expanded the bathroom as part of a very small addition of about 100 SF. We took the house down to framing, replaced the roof, siding, insulation, kitchen, heating, plumbing, electrical and most of the rest of the house. We did not have to deal with the foundation on this house but we did have all the other “big line items” at play. The final cost of this house project was $375K. This is $288/square foot.
Overall per square foot costs should be used and discussed with great caution and truly only used when all in the discussion are perfectly clear about the variables at play and the fuzzy logic nature of making any conclusions about making judgments on the merits of per square foot costs.