10/06/2025

What Is the 30% Rule for Renovations?

If you’ve started exploring a remodel, you’ve probably heard someone mention the “30% rule.” Homeowners in Boise, Meridian, and Eagle bring this up to us often—especially those planning larger or historic renovations. Here’s the straightforward truth: the 30% rule isn’t a law or a building code. It’s a budgeting guideline that can help you think about how much to invest relative to your home’s value and your goals. Used wisely, it’s a helpful starting point. Used blindly, it can be misleading.

The Short Answer

The 30% rule suggests you should generally avoid spending more than about 30% of your home’s current value on a renovation, unless you have strong reasons to do so (long-term ownership, historic preservation, luxury upgrades supported by neighborhood comps, or extensive system replacements). It’s a guardrail, not a requirement.

Where You’ll Hear the 30% Rule (and What It Really Means)

- As a whole-home budget cap:

Many homeowners use 30% of current market value as an upper limit for a comprehensive remodel. For example, if your home is valued at $600,000, a whole-home renovation in the ballpark of $120,000–$180,000 keeps you under that 30% ceiling. This approach helps prevent over-improving compared to neighborhood values.

- As a contingency for older homes:

While typical contingencies range from 10–20%, owners of century-old or historic homes sometimes plan for a higher buffer because surprises are common behind plaster and lathe. We often recommend 15–20% for historic properties, and in rare cases, a contingency approaching 25–30% if conditions are truly unknown. That doesn’t mean the whole budget should be limited to 30% of value—it refers to the portion you set aside for unforeseen issues.

- As a permitting or design threshold:

In some jurisdictions or HOAs, certain scopes of work trigger different levels of review when you alter a large portion of a structure or façade. The exact percentage varies by location and is not universally 30%. In Boise’s historic districts (North End, East End, and others), most exterior changes require review, but thresholds are defined by local rules, not a simple “30%.” When in doubt, we coordinate with the City of Boise to clarify what your project requires.

How the 30% Rule Helps

Prevents over-investing relative to your neighborhood and resale comps.
Sets expectations for whole-home projects versus targeted upgrades.
Supports financing conversations by aligning scope with value.
Encourages prioritization when balancing “must-haves” and “nice-to-haves.”

Where the 30% Rule Falls Short

Historic preservation and safety come first: If your project requires electrical re-wiring, structural repairs, or asbestos abatement, safety and code compliance can push you beyond a neat percentage.
Luxury homes and premium finishes: High-end neighborhoods in Boise, Meridian, and Eagle may support higher investments without over-improving.
Phased renovations: If you’re tackling improvements over several years, a single 30% cap may not reflect your total plan.
It’s not a code or a loan rule: Don’t mistake 30% for a legal threshold or financing maximum. Lenders and building departments use different metrics.

Practical Budget Benchmarks We Use

Because “30%” can mean different things, these ranges are often more useful when planning:

Kitchen: 10–15% of current home value for a full, quality renovation; or roughly 25–35% of a whole-home remodel budget.
Primary bathroom: 5–10% of home value; or 10–20% of a whole-home budget, depending on scope and finishes.
Secondary bathrooms/powder rooms: 2–5% of home value combined, depending on number and level of finish.
Systems (electrical, plumbing, HVAC): 10–20% of project budget in older or historic homes; less in newer homes.
Windows, exterior, and envelope work: 5–15% of project budget, more if historic window restoration is included.
Design, permits, and project management: 10–20% of project budget, reflecting the level of design detail and approvals required.
Contingency: 10–20% for most projects; 15–25% for historic homes or when conditions are unknown.

Boise-Area Examples

Example 1: Whole-home refresh in Meridian

Home value: $650,000. A 30% guideline would suggest staying under $195,000 for a comprehensive update. A balanced allocation might look like:

Kitchen and pantry: $60,000–$75,000
Two bathrooms: $35,000–$55,000 combined
Flooring, paint, trim: $25,000–$40,000
Lighting and minor electrical updates: $10,000–$20,000
Design/permits/project management: $20,000–$30,000
Contingency (12–15%): $18,000–$25,000

This keeps the project aligned with neighborhood values while delivering high-impact updates.

Example 2: Historic bungalow in Boise’s North End

Home value: $500,000. You plan to modernize mechanicals, restore original millwork, update kitchen and baths, and address knob-and-tube wiring. The scope may exceed the 30% cap, but the reasons are sound: safety, code compliance, and preservation of historic character. In these cases, we help you evaluate:

How long you’ll stay—10+ years often justifies investing beyond 30%
Neighborhood comps and the premium for preserved historic features.
Phasing options to spread investment over time.
Opportunities to retain original materials and reduce cost without compromising character.

Should You Ever Exceed 30%?

Yes—when it serves your goals and makes financial sense. Consider going beyond 30% if:

You plan to stay long-term and want a home that truly fits how you live.
Health, safety, or structural work requires significant investment.
Your home is in a high-value area where top-tier renovations are supported by comps.
You’re preserving historic elements whose craftsmanship and value can’t be replicated cheaply.

Common Misunderstandings About the 30% Rule

“It’s the law.” It’s not. Codes and permitting rules don’t rely on a universal 30% threshold.
“It’s the right contingency for every project.” Not necessarily. Most projects are well served by 10–20%. Historic projects sometimes warrant more.
“It applies to individual rooms.” The 30% rule is typically discussed at the whole-home level. For rooms, use category benchmarks (like 10–15% of home value for a full kitchen remodel).

How DreamWorx Renovations Uses the Rule—And Goes Beyond It

At DreamWorx Renovations, we treat the 30% rule as a conversation starter, not a finish line. We combine it with a transparent scope analysis, line-item budgeting, and Boise-area market context. For historic homes, our certified team carefully balances preservation with modern performance, often uncovering cost efficiencies by restoring existing features rather than replacing them.

A Practical Path to Your Remodel Budget

Step 1: Establish current home value using recent comps in Boise, Meridian, or Eagle.
Step 2: Define goals—livability, resale, preservation, or all three.
Step 3: Align scope to value using category benchmarks instead of a single percentage.
Step 4: Plan a smart contingency—10–20% typically, 15–25% for historic or unknown conditions.
Step 5: Confirm permitting, especially in Boise’s historic districts—our team coordinates with the City to streamline approvals.
Step 6: Phase strategically if needed to keep investments aligned with cash flow and goals.

Bottom Line

The 30% rule for renovations is a useful guideline—but it’s not a universal truth. In the Treasure Valley, the best outcomes come from pairing market-aware budgeting with thoughtful design, diligent planning, and skilled execution. For historic homes, a certified partner who respects original character while upgrading performance is essential.

Start Your Boise-Area Remodel With Confidence

DreamWorx Renovations is a family-owned, Boise-based team with 30+ years of experience and certification in historic home renovations. Whether you’re planning a luxury whole-home transformation or a targeted upgrade, we’ll help you calibrate your budget, navigate permitting, and deliver exceptional craftsmanship.

Let’s talk about your project and create a plan that makes sense—30% rule or not. Visit Dreamworx Renovation to get started.

Refrences

National Association of Realtors (NAR) – 2024 Remodeling Impact Report Explains how remodeling costs relate to home value, return on investment, and resale value.
Remodeling Magazine – Cost vs. Value Report Updated annually, this is one of the most trusted sources for remodel ROI benchmarks by region (you can reference the Mountain Region or Boise metro area).
National Association of Home Builders (NAHB) Provides data on average construction costs, contingency planning, and how budgets relate to home value.
Bankrate – Home Renovation Budgeting Guide Discusses how much to spend on remodeling based on home value, with the 10–30% guideline mentioned.
HGTV + Forbes Home Both outline the “don’t spend more than 30% of your home’s value” principle for remodels and how it ties to equity.
City of Boise Planning & Development Services Reference this for local permitting, historic district regulations, and renovation thresholds.