The words “renovate” and “remodel” are often used interchangeably when it comes to real estate, contracting, and interior design. However, for professionals working in one or more of these industries, these terms actually imply two very different things. Essentially, the difference between them is that a renovation refers to restoring something to a previous state, while a remodel refers to creating something new. Remodeling is the process of changing the functionality and design of an area.
It may involve tearing down a wall to enlarge a bathroom and reconfiguring the kitchen layout so that the cabinets, refrigerator, sink, and stove are in different places. Building an addition to your home would also be considered a remodel. However, remodeling doesn't always involve major structural changes; it can be something as simple as converting a guest room into a home office. If the purpose of the area has changed, it has been remodeled.
The terms renovation and remodeling are often used interchangeably. But for housing professionals, they're different. Both involve physical changes to a property, but differ in the cost and types of construction involved. Because renovation usually costs less, and because it involves repairing and updating the basic features of a home, homeowners often see a better return on investment in renovation projects than in remodeling projects when they sell their house.
The magazine Remodeling publishes an annual analysis of the cost in relation to the value of common home improvement projects and notes that renovation projects, such as replacing an entrance door or garage door, or changing the siding of a house, will generate an ROI for the owner of approximately 75 percent, 98 percent and 76 percent, respectively, when the house is sold.
