Renovation costs are on the rise. Could a personal loan help you fund your home improvement project?

Couple painting their walls after getting personal loan to fund construction

Are you a homeowner with renovations on your mind? Have you been living on a building site for the last few months? You’re not alone.

According to recent Houzz data, renovation activity and spending has hit a three-year high. Nearly half of homeowners surveyed claimed to have renovated their homes in 2021 (48%), up from 44% in 2020.

Handling the cost of a reno

Did you know that a simple reno could cost you more now than in previous years? Luckily, there are a bunch of low rate personal loan options that could help you cover the cost.

Houzz revealed that planned renovation spend has increased year-over-year, hitting $25,000 compared with $20,000 in 2020.

And keep in mind that the planned budget doesn’t always reflect the actual cost, as homeowners recorded a significant 43% jump in median renovation spend to $30,000 from $21,000 in 2020. Recent homebuyers exceeded the national median spend, hitting $40,000 for renos and surpassing short-term and long-term homeowners ($35,000 and $25,000, respectively).

Help from reno companies

Unsurprisingly, the surge in renos has led to demand growing for home professionals. Homeowners are hiring help for their renovation projects more than the year prior (94% versus 91%). This is no doubt further driving up the price of construction, as there are fewer tradies to go around.

As predicted by Corelogic back in April, this swell in demand coincides with an ongoing global supply chain crisis caused by the pandemic, then made worse by instability and inflation caused by the geopolitical situation in Ukraine.

“For anyone who is looking to build or to renovate, or for someone who owns a business involved in the residential construction industry, it means they are all likely to be facing significantly higher costs,” said Tim Lawless, CoreLogic research director.

No matter how big or small your project, renovations can require a bit of funding assistance, and that's where renovation personal loans can take some of the pressure off.

Want to start comparing loans for your reno? Check out some options on offer right now below or head to the best personal loans in Australia this month for Mozo Experts Choice Award Winners and editor’s picks.

Top reno personal loans - last updated 27 June 2022

Search promoted personal loans below or do a full Mozo database search . Advertiser disclosure
  • Home Improvement Loan

    Fixed, Unsecured

    interest rate
    comparison rate
    Monthly repayment
    5.75% p.a.
    5.96% p.a.based on $30,000
    over 5 years

    Handypay offers flexible home improvement loans for Excellent Credit or better. Handypay is a specialist home improvement plan provider and offers loans up to $75,000.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 5.75% would cost $34,840.18 including fees.

    Details
  • Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    5.35% p.a.to 19.09% p.a.
    6.14% p.a.to 19.99% 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 5.35% would cost $34,832.61 including fees.

    Details

* WARNING: The Comparison Rate combines the lender's interest rate, fees and charges into a single rate to show the true cost of a personal loan. The comparison rates displayed are calculated based on a loan of $30,000 for a term of 5 years or a loan of $10,000 for a term of 3 years as indicated, based on monthly principal and interest repayments, on a secured basis for secured loans and an unsecured basis for unsecured loans. This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

^See information about the Mozo Experts Choice Personal Loan Awards

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