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If you’ve fallen out of love with your home, you’re left with two options: either ‘do up’ or ‘sell up’. An increasing number of homeowners are choosing to renovate their properties rather than move home entirely and for good reason.
Many find that it is significantly cheaper to update their current property into the home of their dreams rather than simply move somewhere new entirely.
But is it really worth renovating your home? And how do you go about funding your home improvements? LoanTube investigates.
Why do People Choose not to Move?
Moving to a new house is an expensive business. When you consider the difference in property value between your old and new home, rising house prices, expensive stamp duty, removals costs, and the extra expense of solicitors and real estate agents, the total cost of moving home can quickly add up.
Here are the typical fees you could expect to pay when you buy or sell a home. The following figures are based on the average house price in the UK according to the most recent UK Property Price Index (March 2018), currently standing at £224,144.
|Average cost of selling a house in 2018|
|Energy Performance Certificate (EPC)||£90|
|Estate Agent Fees||£5603|
|Average cost of buying a home in 2018|
This brings the total cost of buying, selling, and moving house to £10,210. When you consider that you’ll be buying your new house for much more than the price you fetch for your current house, it’s easy to see how moving home could cost considerably more than staying put.
With the cost of moving being so high, people are unhappy with the outdated appearance of their home, people running out of space for their growing families, and people simply looking for a change are all now choosing to improve their property instead.
Reasons to Improve and not Move
The best reason to stay put in your current home is often the simplest. Many homeowners feel settled in their area with neighbours they know and nearby local schools they enrol the kids into. In this case, choosing to renovate your property to suit your needs and preferences is both cost-effective and convenient.
If you have space, an extension could help you get extra space you need for the fraction of the cost of purchasing a larger home. Renovating your property with a modern kitchen or upgraded bathroom can also breathe new life into your tired-looking home. Such home improvements can add value to your home.
It is also a good option to stay put if you don’t have much equity in your home. Not much equity in your home really limits your choices about where you can move to and the type of house you can buy. Negative equity is even worse – this is when the price you get for your home is lower than the amount you still owe on the mortgage, leaving you out of pocket.
Increase the resale value of your home
If you decide to ‘do up’, your home, rather than simply sell up, this has some major future benefits. Home improvements greatly increase the resale value of your property, with the “improve before you move” strategy becoming an essential tactic when climbing the housing ladder.
Those who renovated their home before putting it on the market have seen the value of their home increase significantly, as you can see below.
|Renovation type||Average value added||Typical price increase on a home worth £224,144|
|Off street parking||5.2%||£11,655|
Not only can you enjoy a much more personalised and attractive home you’ll love living in but when you come to sell, you’ll see your investment in your home produce real returns.
How to Fund your Home Improvements?
While you can save a considerable amount of money by improving your current property instead of moving, home improvements can still be expensive.
Many homeowners opt to use their savings to fund their renovations extend their mortgage to cover the cost of extending or modernising their home. However, this is not possible for everyone and many choose to take out home improvement loans to spread the cost of their refurbishment over time.
Personal loans for home improvements are very popular in the UK with most homeowners choosing to borrow between £1,000 and £15,000 to fund their makeover.
Home Improvement Loans
If you want a new kitchen with all the latest mods and cons, if you need a cash boost to pay for a much-needed roof repair, or if you’re thinking about a home extension to transform your property, a home improvement loan could be the solution for you.
When you take out a personal loan such as this, your repayments are fixed. That means you can pay your contractors upfront then spread the cost of your improvement work into regular and manageable monthly instalments.
You will know exactly how much you need to pay back each month and how long your loan will last. This allows you to effectively budget around the cost of your renovations without needing to dip into your savings.
Things to Consider Before Taking out a Home Improvement Loan
Whatever you may have planned for your home, renovations can be expensive. If you decide to fund your project with a home improvement loan, you should make sure you know exactly what it is you need.
First, you will need to consider the time and cost of your improvement work. Plan what you are hoping to change in your home, and then do some research into how much local tradesmen are charging for it.
Often while making changes to their home, people do not include the cost of preparations into their budget. Materials, planning permission, and groundwork like plastering can hike up the price of your home improvements above your original quote.
Make sure you know exactly how much the entire project is going to cost – and be realistic. You should always have plans in place in case you accidentally overspend.
When you have a quote for your home renovations, you have a proposed start and end date, and you have selected a contractor for your work, you’re ready to start looking for the perfect loan to suit your needs.
Finding the Right Home Improvement Loan to Suit you
Just like any other financial product, home improvement loan deals can vary greatly from lender to lender. Securing the best possible terms and the lowest interest rates available can make a huge difference to how much you repay for your home improvement loan.
That’s why it is important that you shop around before deciding on a single loan provider.
Lenders will have their own criteria for accepting someone for their home improvement loans too. Using a credit broker like LoanTube does all of the hard work for you; narrowing down your options to multiple lenders in the UK who are most likely to accept your loan request.
For your peace of mind, we’re licensed by and registered with the Financial Conduct Authority, as are all the lenders we work with.
What you Need to Know About Making a Home Improvement Loan Application Through LoanTube
At LoanTube, we work to help people find the cheapest home improvement loan possible, even for borrowers with poor credit ratings. Although we can’t guarantee we’ll find you a lender, you really do have better chances of finding a suitable loan with us because of the reason we work with multiple lenders.
How does it work? Our clever computer system compares real-time offers made direct by Home improvement Loans lenders. This is all done in real-time and, once we’ve got all the quotes, we present all these offers with their terms and condition to you, to be able to take an informed decision.
To start your application, please click here.
[/vc_column_text][vc_column_text]Source: UK Property Price Index (March 2018)[/vc_column_text][/vc_column][/vc_row]