Market value is the price paid for your house. Replacement cost is the price it will take to rebuild your house in the same location, the same size, and same quality of construction at today's costs.

The cost to rebuild a home not only includes material and equipment costs, but also labor. Unforeseen costs on the job site can quickly pop up throughout the scope of the project. Replacement cost estimates take into consideration these potential adjustments. An architect or engineer may need to be brought in. Demolition and debris removal, code compliance and building permits are also factors.