Home renovation spending surges on back of Homebuilder

Since the federal government’s decision in late November to extend its HomeBuilder scheme, a growing number of Australians have been pouring some serious money into home renovation projects like garden landscaping and room remodelling.

HomeBuilder, which began in June last year, involved handing out $25,000 cash grants (now reduced down to $15,000) to eligible households to cover the cost of home building or renovations. This scheme was introduced to help boost activity in the housing construction industry, and has so far seen a huge takeup in interest. According to Treasury figures, 75,143 households applied as of 31 December, which is almost double of what was initially predicted.

What are home owners spending on?

The popularity of HomeBuilder has had a flow-on effect to Australia’s spending habits. Recent data from Buy Now Pay Later service Zip reveals Aussies spent 33% more on installation and renovation over December, while a range of trade services (carpenters, flooring, plasterers, plumbing, roofing and tiling) also saw their transaction values increase by about 69%. 

Furniture and homeware were also top of mind for many households, with money spent on these items soaring by 42% in December. 

But the focus hasn’t only been on indoor areas. Many Australians also focused on improving their outdoors space, with spending on landscaping and gardeners up by 58% and 59% respectively. 

These figures are based on a sample of more than 1.5 million Zip customers and 300,000 users of budgeting app Pocketbook. 

How to fund your next home renovation 

With HomeBuilder set to end on 31 March 2021, you may be looking for another way to fund future renovations. Given that it could take many years of saving up before you’re able to afford an entire bathroom makeover or kitchen upgrade out of pocket, a personal loan can be a good alternative to help you spread the cost.

While personal loans haven’t experienced nearly as many rate cuts as home loans, there are still competitive rates up for grabs, especially from smaller mutual banks and credit unions. Right now the lowest personal rate in the Mozo database sits at just 3.65% (4.59% comparison rate*) with the Australian Military Bank - available to consumers installing or purchasing eco-friendly products for their home (as it’s a green loan). 

Or if you have equity in your property...

For even larger scale renovations (over $50,000), you may consider tapping into your home equity. Home equity is essentially the portion of your property that belongs to you, so if your house is valued at $700,000 and your mortgage is $450,000, then your equity would be $250,000. 

Generally speaking you’ll need to own at least 20% of your property before your lender will agree to release any equity to you. Beware though, this option will increase the size of your home loan, so expect both your mortgage repayments and interest costs to go up. 

Check out our guide on for even more ways to fund your home renovation, and weigh up their pros and cons to find the best finance option for you. If you’re interested in seeing what personal loans are available for renovation projects, scroll down for a snapshot.