With today's challenging housing market, more homeowners are looking to improve their home instead of selling and upgrading to a better house. Remodels can get expensive though, and nobody wants to spend more than necessary. Here are seven ways you get to most from your remodeling dollar.

IN PICTURES: 6 Tips On Selling Your Home In A Down Market

  1. Be Your Own Contractor
    Sure, it's nice just to hand your kitchen remodel or basement finishing project to someone else to handle, but you're paying a price for this privilege. Why not hire that electrician or plumber yourself? Although contractors can be a timesaver, they charge for that time. Break down your remodeling project into different tasks (electrical, drywall, etc.) and get quotes yourself. Look for parts you may be able to do yourself. Just be sure to check with your local building department on building permits you may need.

  2. Choose Changes Wisely
    It's exciting to dream of that perfect kitchen or bathroom, but have you thought about how much those changes will cost? A great way to save on a remodeling job is to work within the existing footprint of your space - this means that you don't move the toilet, bathtub or sink, for instance. Moving plumbing and electrical lines will take a big chunk out of your budget, so ask yourself: do I really need to rearrange the entire room? Conversely, taking down a wall can make a dramatic change with a relatively low cost - as long as it's not load-bearing. Bring in a framing consultant if you're not sure. (For more, check out Fix It And Flip It: The Value of Remodeling.)

  3. Reuse or Resell
    Choosing new kitchen cabinets and shiny new faucets is fun, but also adds to your budget. If items in your space are still in good working order, consider reusing them. Old kitchen cabinets look brand-new with a coat of paint or new doors - same goes for vanities. You can even refinish bathtubs or laminate countertops that have seen better days; just browse you local home improvement center and ask for help. You're not only saving on that new counter or wall of kitchen cabinets, you're also saving by not having to pay for demolition and disposal. If you do decide to go new, try selling your removed items online or at a yard sale - your trash might be someone else's treasure.

  4. Know When to DIY ... and When Not to
    Many home improvement projects are easy to do yourself, such as painting, attaching hardware or installing a toilet - really, it's easier than you think! Before hiring a professional, find out what steps are involved in each project, and any tools that may be required. Complex electrical and plumbing jobs are best left to professionals. Check with your local home improvement center for tool rentals to save money if you decide to DIY. (Learn more in Do-It-Yourself Projects To Boost Home Value.)

  5. Consider Your Options
    That chef-style appliance sure is beautiful, but is it really worth it? When itemizing your budget, look at each expense carefully. Look for three comparable items, preferably ones that are lower in price. Is that more expensive item worth it? Trendy tile is fun today, but will it date your bathroom in five years? Make sure you shop around, including online - there are many wholesalers in home improvement items on the web that sell at a deep discount. Look for the best value in each purchase, one that will last for years to come.

  6. Focus on Function
    Once you start exploring your remodeling options, it's easy to get distracted by all the possibilities. A wine cellar would be beautiful in the basement, and how about a heated towel rack in the bath? Before you get carried away, remember how you plan to use the space. Is it a playroom for the kids? If so, durable materials are most important. A giant island looks beautiful in a large kitchen, but will ruin the functionality of a small one. Be realistic; it's very easy to double your budget by adding items that fit someone else's lifestyle. Make sure your new space works for you.

  7. Prepare for Detours
    Imagine this scenario: you demolish your old bathroom, only to find mold in the walls. Removal of the mold now puts you over your budget before you've even ordered your Italian marble. Almost every remodel hits a snag that usually comes with a price tag. When you create your budget, look for items you could potentially save on. Could you choose a less expensive tile, hardware or flooring? Thinking of these potential roadblocks before they happen will make it easier to adjust, and takes the stress out of the job. Coming up with a plan B is a great way to avoid going over budget.

Bringing in the New
Remodels can be stressful, exciting and expensive. With these cost-saving tips, you'll be the smart homeowner who'll see the biggest return on investment. (For more helpful tips, check out 10 Ways To Increase The Value Of Your Home.)

Get a rundown of the latest financial news in this week's Water Cooler Finance: Buffett Buzz, Toxic CDOs And Facebook Privacy.

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