Construction costs are rising at record rates - could a home renovation loan help you?

couple painting walls in spite of rising construction costs with money from a home renovation loan

New reporting from Corelogic’s Cordell Construction Cost Index (CCCI) indicates a record rate of growth in home construction costs in the year to September 2022. If you’ve been looking to make some changes to your home, you could be in for a nasty shock.

In the 12 months since September 2021, construction costs increased by 11%. This was a quarterly rise of 4.7%, significantly higher than the previous quarter’s increase of 2.4%. 

The construction industry has experienced the dramatic impacts of inflation, with the Consumer Price Index (CPI) at an all time high. This has hit materials like timber and metal, resulting in increased costs for things like housing frames and reinforcing. 

So where does that leave you? Well, rate rises might have increased your home loan repayments and made renovations more expensive, but there are ways to make your remodelling dream a reality.

How can home renovation loans help you?

You might be used to personal loans for smaller amounts, but home renovation loans could be an answer to putting your plans into action.

At a time where the housing market is in decline, home renovations can be used to add value to your property. When it does come time to move, you could end up making back the money that you spent on those home improvements. 

If you are looking to make an energy efficient addition to your home, a green loan could be worth a look. These will offer similar options, but to incentivise a changeover to green energy, these may offer lower interest rates.

The national average spent on home renovations, according to information from Suncorp, was $63,188 in 2020. This will have likely increased considerably along with the increases to construction costs. There are more than 20 unsecured loans in the Mozo database that allow for you to borrow this amount of money, and more still when your loan is secured against property.

We’ve rounded up some loans to start your search below.

Personal loan uptake is on the rise so stay in the loop and learn the ins and outs with our guide to easy personal loans. Find some standout loans with Mozo’s best personal loans.

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can search our database of 252 personal loans.
Last updated 25 June 2024 Important disclosures and comparison rate warning*
  • Mozo Expert Choice Badge
    Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    6.75% p.a.to 26.95% p.a.
    6.75% p.a.to 26.95% p.a.based on $30,000
    over 5 years

    Borrow up to $50,000 unsecured. Perfect if you earn more than $22,100 p.a. and have good to excellent credit. Multi-year winner of Mozo’s Experts Choice Unsecured Personal Loan Award, 2021, 2022, 2023 & 2024^'

    Repayment terms from 2 years to 7 years. Representative example: a 5 year $30,000 loan at 6.75% would cost $35,430.23 including fees.

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    Details
  • Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    5.76% p.a.to 24.03% p.a.
    6.55% p.a.to 24.98% p.a.based on $30,000
    over 5 years

    Fast, easy and 100% online, this is a low cost loan with no ongoing fees or extra repayment penalties. It's perfect for savvy borrowers with great credit. If you’re over 18 and earn above $30,000, you could qualify (other eligibility criteria may apply).

    Repayment terms from 3 years to 7 years. Representative example: a 5 year $30,000 loan at 5.76% would cost $35,173.52 including fees.

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  • Mozo Expert Choice Badge
    Low Rate Personal Loan

    Excellent Credit

    interest rate
    comparison rate
    Monthly repayment
    6.57% p.a.to 8.48% p.a.
    7.19% p.a.to 8.84% p.a.based on $30,000
    over 5 years

    Competitive low rates for borrowers with excellent credit on 1-7 year loans from $2,001 up to $75,000, plus free extra repayments. Winner of Mozo's Experts Choice Excellent Credit Unsecured Personal Loan 2024 and Excellent Credit Secured Personal Loan 2024 awards ^. Min. income of 25k after tax, to apply.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.57% would cost $35,528.12 including fees.

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    Details
  • Debt Consolidation Loan

    interest rate
    comparison rate
    Monthly repayment
    5.76% p.a.to 24.03% p.a.
    6.57% p.a.to 24.99% p.a.based on $30,000
    over 5 years

    Roll multiple debts into one loan to streamline your finances with one set of repayments and one interest rate. Competitive fixed interest rates with no monthly or early repayment fees and flexible repayment options. Easy online application and funding in as little as 24 hours (subject to approval).

    Repayment terms from 3 years to 7 years. Representative example: a 5 year $30,000 loan at 5.76% would cost $35,173.52 including fees.

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    Details