The Renovation Boom: Canadians Spend More On RemodellingNovember 2, 2015
Canadians love to renovate. In 2014, home renovation spending hit $68 billion, about $20 billion more than what was spent on new home purchases. It’s safe to say that Canadians are fixing up their homes like never before.
Reasons Behind The Renovations
There’s a lot of debate about what’s driving the renovation boom. One theory is that as Canadian home prices continue to rise the cost of moving into a new home gets further out of reach encouraging Canadians to stay put.
Another suggestion is the “HGTV effect”. The television station HGTV Canada is well known for its hit renovation and DIY shows. These television series are great for providing homeowners with a variety of remodelling tips, tricks and ideas.
Finally, another factor could be the typical age of homes in Canada. “There are a number of homes out there that are more 50 years old and they require a lot of work all the time,” explained Peter Norman, chief economist with Altus Group to the Financial Post.
Canadian Renovations By The Numbers
In a housing report released by the Altus Group, a Toronto-based property consulting firm, almost two-thirds of renovation spending is in Ontario and Quebec with $26.1 and $16.4 billion spent. Renovations account for one in five dollars borrowed with home equity lines of credit. Additionally, while necessary repair work accounts for approximately one in four dollars spent, the remaining three dollars (out of the four) is spent on alterations and improvements.
Altus Group does not expect the home renovation trend to slow, in fact, they expect spending on renovations to continue to grow annually in both 2015 and 2016 by three per cent.
Thinking About Renovating?
If there are renovations you’re thinking about doing or having done, keep in mind that some renovations add value to your home and others will not. Renovations such as swimming pools, hot tubs and elaborate landscaping typically do not provide a return. So if an in ground pool is on your to-do list, make sure it’s for your own enjoyment.
Before you start your home renovations, make sure you contact your home insurance provider. It’s important you ensure you’re properly covered during the renovating process and after they’re complete. A before and after talk with your home insurance provider is crucial.
- Related Read: Home Renovations And Your Home Insurance
Depending on the renovation, your home insurance premiums may change. Some renovations may increase your home insurance premiums to cover additional risks (like a pool) or if the renovations increase the replacement value of your home. On the flip side, your home insurance rates could decrease—let’s say you upgrade your electrical system, install a home security system, or amp up your home’s fire prevention measures.
In any case, big or small, renovations can be stressful and if something goes awry you’ll want to make sure your home insurance is there to protect you when you need it most.