Are you taking advantage of the rise in home renovations?

by Maya Breen19 Feb 2015
Almost half of Australian homeowners plan to renovate their property this year, according to Mortgage Choice’s latest Happy As Index, so brokers are being urged to touch base with their existing clients in time for home renovations.
Mortgage Choice spokesperson Jessica Darnbrough told Australian Broker people could fund their renovations in many ways, from using savings, to a loan top-up, refinancing their mortgage or even a construction loan.
“A broker’s most lucrative asset is their existing client database,” she said.
In light of the domino effect of low rates following the RBA’s 25 basis point cash rate cut, Darnbrough said it is a good time for brokers to touch base with their clients and explain how they can not only refinance their mortgage to help finance their renovations but even potentially lower their mortgage repayments at the same time.
“It’s a win-win.” 
The research found that across the country one third of respondents said the bathroom was on the top of their ‘to do’ list, although for homeowners in South Australia and Western Australia, kitchens were at the top of the list.
“Kitchens and bathrooms can be two of the most expensive rooms to renovate, so the fact that they’re at the top of the ‘to do’ list is probably a great thing for brokers,” Darnbrough said.
She said the larger projects often call for a financing option as they are not something people usually pay for out of their savings.
“The costs do tend to blow out from time to time so a lot of people do look to finance their renovations not through their savings but through a different avenue and that’s where a broker can play a great role."
Westpac’s general manager for broker distribution Tony MacRae has also been encouraging brokers to take advantage of the rise in home renovations, after the release of the Westpac Renovation Report.