HGTV's Scott McGillivray offers advice on making the most out of your renovation budget
TORONTO, March 27, 2014 /CNW/ - A new CIBC (TSX: CM) (NYSE: CM) poll conducted by Nielsen finds that four in 10 Canadian homeowners are planning some type of renovation this year, with an average expected cost of almost $20,000 - up almost 30 per cent from a year ago.
Highlights of the poll include:
- 40 per cent of Canadian homeowners plan to renovate their home in the next 12 months, comparable to last year's findings, when 39 per cent planned to make renovations
- $19,754 is the average amount Canadian homeowners plan to spend on their home renovations in 2014 - up 29% from CIBC's 2013 poll, when the average was $15,300
- Basic home maintenance (57 per cent) is the top planned renovation, followed by bathrooms (33 per cent) and kitchens (32 per cent)
"Our poll shows that home renovation will continue to be a big business in Canada this year," says Todd Lawrence, Senior Vice-President, Products & Payments at CIBC. "However, enjoying the benefits of renovating your home really begins with getting your financial house in order and knowing what you can afford."
"When you start a renovation you usually have a mental picture of what the end result will look like but you should also have a picture of how paying for that renovation will fit in with the rest of your financial obligations," says Mr. Lawrence.
A CIBC poll earlier this year found that the top financial priority for Canadians in 2014 was paying down debt, with building savings second on the list. Since renovations can carry a significant price tag for many homeowners, they need to set a clear budget up front and understand their financing options, to ensure they don't derail their progress towards other financial goals.
HGTV's Scott McGillivray advises on how to maximize your renovation investment and stay on-budget
"It's good news that so many Canadian homeowners have the willingness to invest in their homes," says Scott McGillivray, host of HGTV's Income Property. "It shows not only that they have confidence in the housing market, but that they see the value in safeguarding their investment."
But homeowners still need to be savvy about how they spend their budget, as some renovations provide more value than others, according to Mr. McGillivray.
"While renovating rooms like kitchens and bathrooms are always good investments, I'm encouraged to see that a large number of homeowners are also planning to spend money on general upkeep this year," adds Mr. McGillivray. "Keeping your house in good repair helps to protect its value."
It always pays to be proactive rather than reactive when it comes to home maintenance, advises Mr. McGillivray. Replacing items, such as roofs and windows when needed, will cost less than having to repair damage resulting from leaks, he says.
To make sure you stick to your renovation budget while getting the greatest return on your investment, Mr. McGillivray offers the following tips:
- Get it in Writing - You should always get quotes from contractors before any work starts, and have a signed agreement that details the scope of work to be done and itemizes the cost. You also need to be clear on what's not included in your contractor's quote so that you are not caught off guard by unexpected costs that can blow your budget.
- Expect the Unexpected - Regardless of how much you plan in advance, leave a cushion in your budget for the unexpected. You should set aside an additional 25 per cent to cover any unexpected costs.
To help fund your home renovation, CIBC offers the following options:
- Mortgages that provide cash back - CIBC's Cash Back mortgage offers up to 3 per cent cash back based on the amount and term, and can be used to finance renovations, or to furnish or decorate your home.
- Combined mortgage and secured line of credit - CIBC's Home Power Plan, which offers Canadians with equity in their homes a low-cost borrowing solution that can be used to finance expenses, such as home improvements. As you pay down your mortgage, more money becomes available on a line of credit for whenever you need it.
- Unsecured line of credit - This is another option that can be used to finance home renovations, for those who may not have enough equity in their home for a secured line of credit, and is a good solution for borrowing smaller amounts with a plan in place to repay the amount owing.
KEY POLL FINDINGS
On average, amount Canadians homeowners planning to renovate say they will spend on their home renovations in the next year, by region:
|Manitoba and Saskatchewan||$19,896|
Percentage of Canadians who say they plan to renovate in the next 12 months, by region:
|Manitoba and Saskatchewan||37%|
Top planned renovations (among Canadian homeowners planning renovations):
| Basic home maintenance (including painting, flooring,
general repairs and replacing appliances)
|Replacing windows or doors||29%|
|Landscaping (including outdoor deck)||27%|
*Each week, Nielsen Consumer Insights interviews just over 1000 Canadians through teleVox, the company's national telephone omnibus survey. These data were gathered in a sample of 1,015 Canadians between February 6-10, 2014. A sample of this size has a margin of error of +/-3.1%, 19 times out of 20. Sample sizes for regional groups under Key Findings are smaller than typically reported and provided only as reference data.
CIBC is a leading North American financial institution with nearly 11 million personal banking and business clients. CIBC offers a full range of products and services through its comprehensive electronic banking network, branches and offices across Canada, and has offices in the United States and around the world. You can find other news releases and information about CIBC in our Media Centre on our corporate website at www.cibc.com.
For further information:
Caroline Van Hasselt, Director, External Communications, 416-784-6699 or [email protected]