Having a spruced-up home feels great. And it can also boost your home’s value. But, as exciting as the prospect of rolling up your sleeves and getting on with a reno can be, there are certainly pitfalls to avoid.

New year, new you, new reno?

Renovating is exciting. Having aesthetics and function on point can make your home feel new again. And possibly add to its value should you want to sell or refinance.

But we’ve all heard reno horror stories: shonky tradies, budget blowouts and permit nightmares, not to mention the recent supply chain disruptions.

At LJ Hooker, we know loans like we know homes. So we’ve compiled some tips to help you avoid these perils (and associated headaches!), and added in some guidance around financing your reno.

1. Prepare and plan

As Benjamin Franklin said, “if you fail to plan you’re planning to fail”. Bit harsh, but it rings true.

Especially for a reno.

It’s a good idea to keep organised with a to-do list and a timeline.

You’ll need to check for council restrictions and permit requirements. Ignoring this could mean hefty fines. Or having to tear down your hard work (it does happen!).

Contracts should be set in place with tradies, the correct materials purchased, and a budget set … you’ll have a lot on your plate.

Finance Tip 1. Get a lending specialist on board. They can help you understand what can be financed, how it’s done, and what you need to focus on so your plans are acceptable to the lender. Added tip – don’t use your credit card and then try and roll it into your home loan later. Lenders hate that!

2. Research tradies

It’s a no-brainer that a reputable and skilled tradie will most likely provide better outcomes. But they usually come with a higher price tag.

The temptation to hire that cheap as chips mate of a mate is real.

But it’s important to hire licenced tradies. Most state fair trading websites offer a free online service for you to check.

Not doing so runs the risk of fines, shoddy work and costly re-dos. And the work of an unlicenced tradie most likely won’t be covered by insurance.

Also, be sure to check out any reviews and examples of their work.

Finance Tip 2. If you’re borrowing for your reno’s likely the bank will only accept a standard building contract in the applicable state – backed by a licenced and insured builder.

3. Budget and a buffer

You’ll have cost overruns. Everyone always says they won’t – but trust us – you will.

Having a budget is an important step. You need to be realistic about how much your project is going to cost and whether you can afford it.

It’s also wise to have a contingency.

Unexpected costs can really add up – just ask anyone who has completed a reno. Being prepared with a buffer can give you peace of mind to forge ahead in the face of surprises.

Also, having a lending specialist on your side can help make funding your reno more straightforward.

We’ll help you explore your financing options, which might include unlocking the equity in your home to fund your reno or any added costs.

Not only can we help you find a competitive rate. We can also track down flexible loans, such as a line of credit, to help cover any unforeseen costs that crop up.

4. Be flexible

To get a reno done, it’s best to be flexible.

It’s not unheard of to uncover issues during a reno – such as structural problems, water damage, asbestos and faulty wiring – which require you to deviate from your original plans and budget.

The building industry is also facing supply chain disruption due to recent world events, including the COVID-19 pandemic and the war in Ukraine.

As a result, wait times and costs are blowing out for some materials and so a specific item you had your heart set on may need to be replaced with an alternative.

But by being flexible – including having a flexible line of credit – you can adapt and move forward with your reno.

We can help

We know a thing or two about financing a reno.

Our local lending specialists can find flexible loan options, lines of credit and competitive rates to suit you. And if you’ve got equity in your home, we can help you unlock it.

We can also link you with a local property expert who can provide a free market appraisal of what your home may be worth post reno. They can also advise you on what people look for in the area when buying so you can focus your investment in the right areas.

So, if you’d like to find out more, get in touch today. We’re ready to help make your 2023 reno dreams a reality.

Our lending specialists Are available 7 days a week for a phone, web, or face to face chat.

Check out our guide on home loan refinancing!

We hope you found this article helpful. If you'd like to discuss it further please fill in the form below and we'll be in touch.

This article is prepared based on general information. It does not take into account individual financial objectives or needs and is not financial product advice.