For many Canadian homeowners, securing affordable home renovation loans feels like an uphill battle. High financing costs often force them to delay essential home improvements. But what exactly causes these delays, and what do homeowners risk by postponing renovations?
High Interest Rates:
Home renovation loans in Canada are often used as secondary financing by homeowners who already have primary mortgages. Typically, these loans carry steep APRs of 12%–15% or even higher—significantly more expensive than primary mortgage rates. Because of this financial burden, 63% of Canadian homeowners resort to funding renovations from their personal savings, a choice many later regret due to the depletion of their financial reserves and substantial opportunity costs (Financeit Consumer Report, 2022).
Delayed Renovations:
In 2022, roughly 40% of Canadian homeowners considered postponing or scaling back their renovation plans. This figure was even higher (48%) among younger homeowners aged 18–34 (Financeit Consumer Report, 2022). The trend continued into 2023, with 33% of homeowners specifically citing rising interest rates as the primary reason for pausing renovation projects (HomeStars, 2023).
What Homeowners Miss Out:
By delaying renovations, homeowners miss out on significant financial returns, particularly critical for those planning to sell their properties. Kitchen remodels, for instance, typically yield a return on investment (ROI) of 75%–100%, while bathroom upgrades average around 62% ROI (NerdWallet, 2023; RankMyAgent, 2023). Furthermore, postponing renovations also means sacrificing immediate benefits, including improved living comfort, enhanced energy efficiency, and increased resale value.
Why an Alternative Solution Matters:
A 2022 survey of 1,000 Canadian homeowners indicated that 59% would be more comfortable utilizing alternative renovation financing solutions if they better understood their advantages (Financeit Consumer Report, 2022). This clearly signals the urgent and significant demand for affordable home renovation loans that offer near-mortgage interest rates, transparent terms, and asset-backed security.
RenoSage Goal:
RenoSage addresses exactly this demand by offering renovation financing at near-mortgage rates, complete with clear terms and asset-backed security. RenoSage empowers Canadian homeowners to confidently pursue essential home improvements without draining their savings, effectively removing financial barriers to affordable home renovations.