A look at several factors impacting the increased costs to remodel a home in 2021

The Covid-19 pandemic caused a spike in home remodeling projects as homeowners turned their attention to their surroundings. Living arrangements like cramped kitchens and lackluster backyards were tolerable for families that spent little time at home. But when forced to remain in place for any length of time, the walls that seemed to close in around needed, well, to be knocked down. This boom in home remodeling continued into 2021 as many companies delayed bringing workers back to the office and some employees even jumped at the opportunity to work from home indefinitely.

This increased demand initiated a chain of events that started with remodeling contractors hustling to keep up, to supply shortages and increased costs. If you’re wondering why it costs more to remodel your Dallas home than you realized, and want to know why, this article explains all the cost-driving factors and gives tips on navigating the circumstances to bring your home remodeling project closer to a budget you can live with.


Why Remodeling Costs are Going Up

Why Remodeling Costs are Going Up

The truth is, home remodeling costs increase each year. But the increase is so slight most homeowners don’t notice. Then in 2020, costs jumped so dramatically the whole world gasped. For example, according to Remodeling magazine’s Cost vs Value Report, beginning in 2014 costs went up from 2-4 percent each year. But in 2021, they rose up to a whopping 15 percent for several popular projects.

Project  % Increase from 2017-2018 % Increase from 2020-2021
Kitchen remodel (midrange) 2% 10%
Bath remodel (midrange) 3% 14%
Master suite addition (midrange) 3% 15%
New outside deck (composite) 2% 13%

While many sources blame this skyrocketing cost to the pandemic, what, exactly, contributed to this jump is multi-faceted. There are at least six factors that have impacted this trend, which we discuss here.

Factor 1: The Cost of Raw Materials

Yes, the cost of lumber soared over 300 percent from October 2020 to April 2021 but lumber prices are always fluctuating. In fact, if you look at the long-range period from October 2017 to October 2021, the cost of lumber only increased 25 percent, according to lumber prices recorded by Statista.com. Since the huge jumps in prices are short-lived, we can’t assume raw material cost is the only factor impacting the overall cost of remodeling.

Factor 2: The Cost of Labor

During the Great Recession of 2008-09, construction workers lost their jobs and contractors their companies. Many never returned to the field. This, coupled with the industry “aging out,” has left a huge demand for skilled tradespersons. To fill this labor shortage, which includes every level of employee from laborer and apprentice to project manager and licensed professional, companies have had to raise pay scales and offer benefits not historically available in the trades. This increase in pay, also assuring you of the quality that hiring a professional brings to your project, adds to the bottom line.

Factor 3: High Demand

According to the 2021 US Houzz and Home Study, 53 percent of homeowners performed unplanned home remodeling projects during 2020. This huge increase in demand had remodeling contractors hustling to keep up amidst all the pandemic safety protocols. In fact, even in 2021, wait times are up more than a month, according to Houzz.

Factor 4: Global Supply Chain Issues

At the onset of the pandemic, authorities deemed construction an essential business, allowing home remodeling to continue. However, the manufacturing of the goods needed for this industry was shut down. This had home remodelers pulling from a supply chain that was not being replenished. Now, we see a shortage of everything from hardware and wire to appliances and furniture.

Factor 5: Increased Tariffs

A tax placed on imported goods, tariffs on materials necessary for the construction trade have increased in the last several years. In 2018, the Trump administration imposed tariffs on imported steel and aluminum from Canada, Mexico, and the EU. Other tariffs on goods from China are equally exacerbating. The issue prompted The Associated General Contractors of America (AGC) to write a letter to President Biden asking his administration to intervene. However, they’ve done the opposite. According to a November article in the National Association of Homebuilders’ blog (NAHB Now), the Commerce Department has moved forward with “its next administrative review to double the tariffs on Canadian lumber shipments into the U.S. from 9% to 17.9%.”

Factor 6: Consumer Demand for Labor Fairness & Sustainable Products

Today’s consumers are more socially aware than previous generations. They value quality, sustainability, and fairness in the labor market, and are willing to pay for it. These values have driven prices as manufacturers have endeavored to ramp up their sustainability practices in sourcing raw materials and employers have improved compensation packages and working conditions for their teams.


How to Control Your Remodel Costs

Hire a Contractor Now

With so many factors contributing to the rise in home remodeling costs, you may wonder when, or if, you’ll be able to tackle the projects on your home improvement list. Not to worry. There are ways to mitigate remodeling costs. With careful planning, and by implementing some of the following suggestions, you can have the home of your dreams.

Hire a Remodeling Contractor Now

Considering all the factors slowing down the building industry, don’t delay in scheduling an appointment with a remodeling contractor. With an unprecedented increase in the number of home remodeling projects in Dallas, as well as across the country, contractors are in high demand. And, the longer you wait to book an appointment with one and get on their list, the more projects they will book ahead of you.

Choose a Design-Build Team

Some homeowners begin their home remodeling journey with an architect to assure their project is tastefully done, engineered properly, and designed to code. But, when they take their plans to a contractor to build it, they discover their project costs more than their budget allotment. Consider instead an alternative option—choose a design-team team. A design-build firm allows you to work with a design and construction team together. Collectively, these experts creatively problem-solve to accomplish your design objectives while keeping your project on budget. You have one contract that takes you from inception to completion and one point of contact to communicate with you while keeping your project running smooth. The internal team collaboration saves you both time and money in the long run.

Shop Smart

Since the cost of materials has risen, you want to shop smarter than ever before. Retailers lower their prices several times a year on items like lighting, appliances, and flooring. Consider the best time to shop for the materials you need.

  • Retailers lower the price on current appliance models to make room for new releases in September, October, and January.
  • Shop holiday sales—Memorial Day, Labor Day, Veteran’s Day, Black Friday
  • Shop for flooring when the retailers are slow—December and January.

Also, a design-build contractor will have relationships and experience with reputable suppliers, which they will pass on to you. These include recommendations for high performance products and potential supplier discounts.

Stick with Your Decisions

Change orders are expensive. If you wait until cabinets are installed to decide you want a different style or arrangement, for example, it will drive up costs. Not only that, it delays completion. Be mindful of making changes after construction begins and make sure you are 100 percent in agreement with the final design plans before the construction phase begins.

Combine Projects

Moving from one job site to another adds to a builder’s overhead expenses. Therefore, they like projects that keep their workers in place for a while. Also, some projects make sense to do together. For instance, if you have the wall opened up to reroute plumbing for the kitchen, and the laundry room is adjacent, it makes sense to do both jobs at the same time. If you’re thinking of remodeling more than one room, ask your contractor about the possible savings if you do them simultaneously.

Be Wary of Low Bids

Something too good to be true probably is. If one remodeling company offers you an itemized fixed-price contract that’s higher than a less detailed lower bid, chances are the low bidder could come out much higher in the end after true costs are added to your project along the way.

If rising costs have you hesitating to tackle your home remodeling projects, it’s time to sit down with an experienced remodeling professional. The guidance of a qualified design-build remodeling firm will help you achieve what you are looking for, tied to a realistic timeline and budget.


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Blackline Renovations in Dallas can help you with every aspect of your home remodel and keep your project within budget. From the initial meeting to the conceptual design and all the way through completed construction, they’ll guide you every step of the way. Blackline Renovations offers in-home consultations to discuss your specific needs.

Take a look at their portfolio for inspiration, then call 214-827-3747 or email Chris today to schedule a consultation. Still not ready? Subscribe to their newsletter to keep up to date with all things remodeling in Dallas, Texas.