Home improvement shows are pushing some Canadians to opt for the “reno” of their dreams instead of a project more in tune with their financial reality.
Recent surveys have found that 60 per cent of respondents who have renovated their home recently developed a budget before starting their project. However, 27 per cent of renovators spent more than they planned.
Maintaining a renovation budget can be challenging, especially when home improvement TV shows and magazines stir-up consumer appetites for the latest in home appliances and d cor. Home renovators often have the best of intentions when it comes to sticking to their budget, but often the influence of renovation shows can force them into a ‘stretch’ situation, which can cause major financial headaches when the final bill is tallied.
The ability to anticipate extra costs through appropriate financial planning can reduce the stress of home renovations. Experts suggest securing financing prior to the renovation, such as a personal or homeowners line of credit, which provides the financial cushion most home renovators require. Having a line of credit available doesn’t mean that you have to use it, but it does provide added security if you hit unexpected expenses such as re-wiring your home.
While the survey showed that 68 per cent of respondents use cash from savings or investments to pay for renovations, a lack of planning could mean financial challenges down the road. The survey also showed that 34 per cent of homeowners are borrowing to renovate.
Keywords: Home Improvement