The 7-Step Rehab Budget: From Demo to Staging—And Where Investors Most Often Overpay

(Plus the funding hacks that keep your cash safe and your crew moving)

Step 1 – Acquisition & Carry

What you’re paying for: earnest money, closing costs, insurance, taxes, utilities, interest.
Typical overpay: forgetting 2–3 months of carry while permits stall.
Pro-tip: build a “soft-cost reserve”—and let your fix-and-flip bridge loan roll the first-draw interest into that bucket so you don’t write checks during demo.

Step 2 – Demo & Dumpster

Scope: interior gut, wall removal, roof tear-off.
Where investors overpay:

1. Renting dumpsters “as needed” instead of negotiating all-in weekly.

2. Demo change-orders because the GC uncovers knob-and-tube after contract signing.
   Control tactic: require a “surprise clause”—demo crew photographs hidden defects before removal; you approve scope additions in writing.

Step 3 – Structural & Mechanical Rough-In

Scope: framing corrections, plumbing, HVAC, electrical rough.
Common budget bloat: trades milling around while inspections lag. Idle labor bills can burn $300+ per crew per day.
Fix: schedule city inspections 48 hours after rough-in target and bake that date into the subcontract. If the inspector no-shows, your contract pivots crews to another section (exterior, landscape) so money still works.

Step 4 – Exterior Envelope

Scope: roof, windows, siding, paint, gutters.
Overpay hotspot: upgrade fever—architect shingles, black-frame windows, high-end fiber-cement. They look fantastic but rarely move ARV in entry-level neighborhoods.
Math check: if the upgrade adds $4K cost but appraiser’s paired-sale lift is only $2K, skip it.

Step 5 – Drywall & Interior Systems

Scope: insulation inspection, drywall hang & mud, interior doors.
Budget leak: trades charging “wait fees” for moisture or mud-dry times.
Solution: invest $500 in rental dehumidifiers/heaters; shave two days off schedule, saving $1,000+ in labor carry and loan interest.

Step 6 – Kitchens, Baths & Finishes

Scope: cabinets, tile, flooring, trim, paint.
Top overpay: cabinet mis-measures—a $300 custom filler panel plus 10-day reorder lag equals lost goodwill and holding costs.
Fix: template twice, order once. And always keep a 10 % finish contingency; lenders (including us) will fund it in draws if documented.

Step 7 – Staging & Listing Launch

Scope: deep clean, pro photos, light staging, landscaping pop.
Where costs creep: paying high-season staging retainers for extra weeks while punch-list lingers.
Hack: negotiate a “de-stage window”—first 30 days full rate, week-five drops 40 %. Or stage virtually for rentals and lean on DSCR cash-flow comps.

The Hidden 10 % Cushion

Across 700+ rehab loans we funded last year, the average surprise ran 8.6 % of the original budget—exactly why we (and smart investors) pad to a clean 10 %. When you finance rehab with LoanFunders.com:

Draws wired in 48 hrs after inspection so overruns never stall the crew.

Download our free “7-Step Budget Template”!

Ready to Fund Your Next Rehab?

Upload property address + draft budget and receive a 24-hour term sheet with up to 90% LTC and 100% rehab financing.

Fast capital, fewer forms, fully funded rehab.