Home Improvement Costs Glossary
A complete reference of key terms, concepts, and industry jargon to help you understand estimates, quotes, and contracts. 39 terms defined in plain English.
A
- Addition vs. Renovation
- An addition increases the square footage of a home; a renovation improves existing space without changing the footprint.
B
- Building Permit
- Official government authorization required before starting most structural, electrical, plumbing, or HVAC work.
- Board Foot
- A unit of lumber volume equal to a piece 1 inch thick, 12 inches wide, and 12 inches long (144 cubic inches).
C
- Change Order
- A written document that modifies the original scope, cost, or schedule of a construction contract.
- Contingency Budget
- A financial reserve—typically 10–20% of project cost—set aside for unexpected expenses during a renovation.
- Certificate of Occupancy
- A document issued by local government confirming that a completed building or addition meets all code requirements and is safe to occupy.
- Cost-Plus Contract
- A construction contract where the owner pays the actual project costs plus an agreed fee or percentage for the contractor's overhead and profit.
- Cement Board
- A rigid panel made of Portland cement and reinforcing fiber used as a moisture-resistant substrate for tile installations.
- Code Compliance
- Meeting all applicable building codes, zoning ordinances, and safety standards required by local authorities for construction work.
D
E
- Egress Window
- A window large enough to serve as an emergency exit, required by code in every sleeping room including basements.
F
- Flashing
- Thin metal or membrane material installed at roof penetrations and transitions to prevent water from entering the structure.
- Fascia
- The vertical board or trim piece running along the lower edge of a roof, to which gutters are typically attached.
- Fixed-Price Contract
- A construction contract where the contractor agrees to complete a defined scope of work for a set total price.
G
- GFCI Outlet
- A ground-fault circuit interrupter outlet that shuts off power instantly when it detects a current leak, preventing electrocution near water.
- General Contractor
- The primary contractor responsible for managing all aspects of a construction project, including hiring and overseeing subcontractors.
- Gut Renovation
- A major renovation that strips a space down to the structural framing, removing all finishes, mechanical systems, and interior elements.
H
- Header
- A horizontal beam placed above a door, window, or wall opening to support the load from above.
J
- Joist
- A horizontal framing member that supports the floor or ceiling decking of a structure.
L
- Load-Bearing Wall
- A wall that carries structural weight from the roof or upper floors down to the foundation.
- Lien Waiver
- A document signed by a contractor or supplier giving up the right to file a mechanic's lien against the property in exchange for payment.
M
- Material Allowance
- A budgeted dollar amount included in a contract for homeowner-selected materials whose specific cost is not yet known at bidding.
P
- PEX Pipe
- Flexible cross-linked polyethylene tubing widely used for residential water supply lines because it is easy to install and freeze-resistant.
- Panel Upgrade
- Replacing an older or undersized electrical service panel with a larger modern panel to support today's electrical loads.
- Punch List
- A documented list of minor items remaining to be completed or corrected before a construction project is considered substantially finished.
- Permit Pulled
- Slang for obtaining an official building permit from the local government before beginning permitted construction work.
R
S
- Subfloor
- The structural layer of plywood or OSB fastened directly to floor joists, forming the base for finished flooring.
- Soffit
- The finished underside of a roof overhang, eave, staircase, or beam, often ventilated to allow attic airflow.
- Scope Creep
- The gradual expansion of a project's original goals and tasks, typically leading to cost and schedule overruns.
- Square (Roofing)
- A unit of roofing area equal to 100 square feet, used to price shingles and roofing labor.
- Structural Engineer
- A licensed professional engineer who analyzes and designs structural systems to ensure buildings safely carry their intended loads.
- Subcontractor
- A specialty trade contractor hired by the general contractor to perform specific portions of a project, such as electrical or plumbing work.
- Sweat Equity
- The value added to a property through the owner's own labor and effort rather than paid contractor work.
T
- Turnkey Project
- A renovation delivered fully complete and ready to use, where the contractor handles every aspect from design through final cleaning.
U
- Underlayment
- A layer of material installed between the roof decking and the finished roofing surface to provide a secondary moisture barrier.
V
- Variance
- An official exception granted by a local zoning board allowing a property owner to deviate from standard zoning requirements.
39 terms · Updated April 2026