Renovation vs. remodel: What's the difference?

Remodeling is more in-depth than renovating. But what truly defines these seemingly synonymous terms?

Renovation consists of making something old look and feel new, while remodeling consists of making something new out of something old. If you're simply refreshing your space with new finishes and fixtures, you're renovating. If you're looking to take out a wall or two, rearrange the floor plan, and tack on an extra bathroom or closet, you're remodeling.

What is renovating?

Renovation involves updating the look of a home while maintaining its existing layout and structure. It entails refreshing or restoring a project to a like-new state and is generally more DIY-friendly than remodeling.

Sometimes changing finishes calls for structural changes. Replacing laminate flooring with tile may require you to solidify the floor system with beams and a new subfloor that will support the weight of the tile and keep it from cracking.

Renovation tasks include refinishing floors, painting, refacing cabinets, swapping light fixtures, updating plumbing fixtures, changing door hardware and adding trim.

What is remodeling?

Remodeling encompasses projects that restructure the property, like expanding kitchens, adding bathrooms or building sunrooms. Remodeling also covers major tasks like relocating infrastructure — things like adding or replacing electrical wires and breakers, redoing your plumbing or adding central air conditioning. These tasks often require a permit or working with local authorities for approval, especially in the case of historically registered properties.

Examples of remodel tasks include removing walls, changing floor plans, building additions, finishing a basement, adding a second level, building a deck or patio and adding a bedroom suite.

Renovation vs. remodel: cost and value

Renovating generally costs less than remodeling. Things like refacing cabinets and updating plumbing fixtures simply cost less than structural changes like knocking out walls or adding beams. Plus, after structural changes are made, you'll still have to pay for new finishes and fixtures, so you're essentially paying to remodel, then renovate.

Renovations are easier to budget for, as many of the costs of remodeling are hidden. Remodeling is often more involved than it seems. For example, if you were to remove a wall between a kitchen and a dining room to open up the floor plan and add an island, there's a good chance that the wall is hiding things like electrical wires, water lines and ductwork. Once that wall is gone, those things will have to be rerouted, which is a major process that can involve a lot of red tape. On top of this, you must consider that the wall is potentially load-bearing and will have to be replaced by a costly beam.

Warning

When home shopping, be on the lookout for shoddy renovations, so hiring a thorough home inspection before closing is recommended.

If your goal is to make money on your renovation or remodel, remember, most updates simply aren't profitable. In fact, the national averages show that only a small percentage of home updates recoup 100% or more of the initial investment. Of course, the actual ROI is dependent on many variables, like total investment cost, location, market and project scope.