A new BMO study, conducted by Leger Marketing, revealed the top five renovation plans for Canadians. Kitchens came in top at 39, followed by bathrooms (35%), basements (16%), while bedrooms and family rooms nationwide were less apt to undergo renovations in the next year at 11 and 10 per cent respectively.
With concerns regarding household debt on the rise, it appears that Canadians are being choosier how they spend their renovation dollars.
According to the Annual BMO Home Renovation Report, fewer Canadians are planning home renovations this year but are choosing projects with the greatest returns – a sign that consumers are scaling back and becoming more strategic on spending amid rising concern about household debt.
Half of Canadian homeowners (51 per cent) plan to renovate their homes in the next year, compared with 62 per cent in 2011. Single-family homeowners far out-pace their condo-dwelling counterparts (62 per cent versus 41 per cent respectively).
Regionally, the report revealed that while still more than half (52%) of Albertas homeowners planned on renovating their homes in the next year, the province fell behind its reno-hungry neighbours to the east. According to the report, more than two-thirds (67%) of residents in Manitoba and Saskatchewan plan on renovating their homes in the next year.
“The scaled-back plans for home renovations likely reflect increased caution on the part of households as they continue to reduce discretionary spending to rein in debt,” said Sal Guatieri, senior economist, BMO Capital Markets. “After averaging nine per cent in the past decade, consumer loan growth has slowed to almost two per cent recently, suggesting Canadians are taking recent debt warnings to heart.”
A recent poll from CIBC found that almost half of Canadians holding debt made at least one extra payment to bring down their balances in the last 12 months, with the number of Canadians holding some form of debt relatively unchanged at 72 per cent.
The BMO study, conducted by Leger Marketing, also revealed the top five renovation plans for Canadians. Kitchens came in top at 39, followed by bathrooms (35%), basements (16%), while bedrooms and family rooms nationwide were less apt to undergo renovations in the next year at 11 and 10 per cent respectively.
“Making home upgrades can add significant value to a home; however, it’s crucial that homeowners consider the financial implications involved,” Laura Parsons, mortgage expert, BMO Bank of Montreal. “Renovation projects come in different shapes and sizes and vary in return on investment. Homeowners planning to move forward with renovations should consult a professional to help balance wants versus needs and the overall value of the investment.”