Could a personal loan help you with rising renovation costs?
Has having everyone home for Easter made you want to upgrade your bathroom, redo your garden or renovate your whole house?
Did you know that a simple renovation could cost you more now than in the past two decades? Fortunately, there are plenty of low-rate personal loan options that could help you cover the costs.
Recently released CoreLogic data showed a national increase of 3.8% in the quarterly measure of residential construction costs, outpacing the consumer price index by 0.8% for the same period.
The Cordell Construction Cost Index (CCCI) shows this to be the largest quarterly increase since Q3 2000, when construction costs rose 7% after the introduction of the GST.
There has been a surge in housing approvals, which peaked in March, which are now breaking through, driving widespread demand for materials and trades.
Unfortunately, this surge in demand coincides with a global supply chain crisis caused by the pandemic, then compounded by instability and inflation caused by the geopolitical situation in Ukraine.
“The quarterly rate of construction cost growth is happening everywhere and isn’t confined to one city or state, it’s a national trend,” said Tim Lawless, CoreLogic research director.
“There was a much bigger increase in our index when the GST was introduced, but apart from that structural adjustment, this is by far the biggest quarterly change ever. It would be the biggest market-driven increase we’ve seen.
“For anyone looking to build or renovate, or anyone who owns a business involved in the homebuilding industry, this means they are all likely to face significantly higher costs.”
Construction Cost Inflation Could Last Another 12-18 Months, CoreLogic Says
Lawless notes the ongoing inflation problem and states that “it is unlikely that the industry will be able to absorb such a large cost increase in its margins and that higher construction costs will ultimately be passed on to the consumer, which will put further upward pressure on the price of a new home or renovation.”
No matter the size, home improvement can require a small cash injection, and that’s where home improvement personal loans can take some of the pressure off.
Want to start comparing loans for your renovation? 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.
DISCLAIMER: The Comparison Rate combines the lender’s interest rate, fees and charges into one rate to show the true cost of a personal loan. The comparison rates displayed are calculated on the basis of a loan of $30,000 with a term of 5 years or a loan of $10,000 with a term of 3 years as indicated, on the basis of monthly principal and interest repayments, on a secured basis for secured and unsecured loans. basis for unsecured loans. This comparison rate applies only to the example or examples given. Different amounts and durations will result in different comparison rates. Costs such as withdrawal fees or prepayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may affect the cost of the loan.
^ See Mozo Experts Choice Personal Loan Awards information
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