Challenge 3: Lead
There are two potentially hazardous sources of lead in an older home: plumbing pipes and interior/exterior paint.

"Even after lead pipes were replaced in the 1940s, the earliest galvanized pipes still contained lead until it was changed over to zinc," says Gehman. "Lead was also present in much of the solder used to join copper pipes up until the mid-1980s."

Owners of older homes often prefer to install a filtration system to extract lead from their water systems -- a kitchen filtration system might run $500, a whole-house system $2,000 -- rather than replace the pipes, unless the pipes are hopelessly clogged or already included in the remodel.

The potential dangers from lead paint lie in the possibilities that a child might ingest it or that it might fall into a vegetable garden and be ingested through the produce. The rule of thumb is to encapsulate it in latex paint -- remove exterior siding rather than sandblast it to avoid releasing the lead into surrounding soil.

Estimated cost: $6,000 to $7,000 to replace all pipes, $15,000-$18,000 to remove old siding and install new.

Challenge 4: Electricity
When your old home was built, chances are that grounded electrical outlets were either not required by code or only required in locations where water is present such as kitchens and baths. But times and codes have changed. If you're not sure if your outlets are grounded, check them -- if they're two-pronged, instead of three-pronged, they are not grounded outlets. But even if they are three-pronged, have your electrician verify that they are indeed grounded.

Completing electrical work in accordance with code today requires that you install ground-fault-interrupter, or GFI, outlets in your kitchen and baths and possibly one outlet in your garage. The GFI cuts off power immediately should an appliance come in contact with water. It's a small price to pay to avoid tragedy.

It's likely that you'll also have to upgrade your electrical box from the original 60/100- or 125-amp capacity to today's 200-amp standard. A new box is a good investment since older systems weren't built to run modern appliances such as dishwashers, hair dryers, garbage disposals and air conditioners.

But digging into a remodel doesn't mean you're going to have to replace the wiring throughout your entire home.

"Not usually," says Schloegel. "Under the International Residential Code, the building official has the authority. If it is a significant amount of renovation, they can ask for the whole house to be brought up to current code, but we have done major whole-house renovations that were about 75 percent of the house, and they have not made us bring the whole house up to code."

On the other hand, it may be a good home-value investment to do so. In homes where behind-the-wall wiring is not practical, a good alternative may be to conceal the new wiring behind baseboards.

Estimated cost: A single GFI outlet can cost as little as $100. Cost to rewire a kitchen so every appliance has its own circuit: $1,000 to $1,700. Cost to rewire an entire house: $9,000 to $12,000.

Challenge 5: Asbestos
Behind your walls, in your basement or in your attic, asbestos may be lurking. If it is, it can stop your project in a New York minute because permits are required to handle and dispose of it.

"Unfortunately, it was used in quite a few products: floor coverings, as insulation around duct work, even home siding," says Tyson.

Unless the asbestos is "friable," meaning it can be readily crumbled and released into the air in the form of toxic dust most typically found in duct insulation, it shouldn't present a problem.

"If we encounter it, we let the homeowner know, and it will have to be removed by a professional abatement company before we can come in," says Gehman.

Estimated cost: $15,000 to $18,000 for asbestos abatement.

Challenge 6: Windows
Strange as it seems, the old single-pane windows are now typically more expensive and harder to find than the double-pane energy-efficient windows approved for new construction. The originals with new dual-paned energy-savers typically run in the $600 to $800 range.

Challenge 7: Tanks, wells and cesspools
Owners of old homes may not know what surprises await beneath their lawns until renovation projects unearth them. In previous generations, it was common to have an oil tank buried in the backyard to hold heating oil. Even older homes may have had a well, cesspool or septic tank on the property that did the work of modern water and sewer systems.

If you uncover a buried surprise, there are numerous solutions, from removing the tank, if it's empty, to draining it and filling it with rocks or other solid materials. But if you have a buried oil tank, your contractor may have to obtain a special environmental permit and take soil samples to assess possible contamination before digging up and disposing of the tank, usually at a state-approved facility.

Estimated cost: $1,400 to $1,600 to fill a septic tank; $2,000 to $2,500 to remove it; and $3,000 to remove an oil tank if no leaking occurred.

Jay MacDonald is a contributing editor based in Mississippi.