Belts may be tightening but not, it seems, for renovators.
The latest figures from the ABS show Australians spent a whopping $1,044 million on home renovations in May 2023 alone. That’s up 4.3% on the previous month.
Our passion for renovating may stem from binge-watching home improvement shows through the pandemic. But there could be another factor at play.
It can simply be a lot cheaper to renovate your home than to sell up and buy elsewhere.
If you’re thinking of a few home improvements, here’s what to consider.
The 2022 Houzz & Home Report reveals which rooms Australians have targeted for home improvements.
The kitchen comes up trumps, accounting for almost one in four (23%) renovations.
Other top contenders were living room, bathroom and bedroom makeovers (each 20%).
A key step in planning a renovation is crunching the numbers to know the likely cost. This is a must-do before you start collecting colour charts and carpet samples.
Smaller renovations can be affordable do-it-yourself projects. For any structural or specialist work it pays to call in the tradies – and that’s when the cost can start to escalate.
The latest Archicentre Cost Guide sets out typical costs for popular home improvements.
As a guide, you can expect to pay:
– $75-$120 per square metre to polish timber floorboards;
– up to $35 per square metre for interior painting;
– up to $4,600 for an extension; and
– up to $48,000 for a new kitchen (excluding appliances).
While home improvements may not come cheap, quality renovations can boost your lifestyle and your home’s value.
They can also be a money-saver – ‘green’ improvements such as installing rooftop solar panels can put money back in your hip pocket through lower utility bills.
Working out how you’ll pay for a renovation is an essential part of the planning process.
You need to be sure you can comfortably afford the improvements, and avoid the not-so-exciting prospect of running out of funds mid-way through a project.
Using cash savings or a personal loan may be suitable for smaller projects – the shorter term of a personal loan (usually less than five years) can help keep a lid on the interest cost.
For more expensive projects, a home loan top-up can be a quick and easy solution, though it can hinge on you having sufficient home equity to qualify for additional funds.
At the top end of the scale, a dedicated renovation or construction loan is another option.
These can work by drip-feeding funds as different stages of the project are ticked off. You generally only pay interest on funds drawn down, making the cost more manageable.
If a renovation is on your bucket list, call us to discover the options available to fund your project – and the costs involved.
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