When it comes to spending on home renovations, Canadians don’t appear to be slowing down, and many are taking on loans to finance projects, according to data from one consumer lender.
Simply Group says loan applications for home improvements grew 30 per cent in the second quarter of 2021 compared to the first, when large swathes of the economy were still under lockdown restrictions.
Once reopening was fully underway in the summer months, the appetite for renos still didn’t fade. Canadians jumped right into summer improvement projects. Simply Group says through August 2021, the lender saw a 15 per cent rise in loan applications compared to July. And from May through August, June was the busiest month for applications, the lender says.
Provincially, Quebec saw the greatest increase in renovation financing requests, Simply Group says, clocking in with a 96 per cent increase in the second quarter. Alberta also had a strong showing, seeing a 40 per cent increase in applications during the same time period. Ontario came in third place at 12 per cent.
Simply Group’s findings match data from Statistics Canada , which show investment in residential renovations steadily rising from February to July 2021.
So what’s behind all that increased spending on renovations? Simply Group says pandemic lockdowns, which led to more time spent at home and less opportunities to spend elsewhere, were likely part of it. But a hot housing market may also have been behind some of those projects.
“The real estate market and housing sector saw heightened interest from Canadian homebuyers, with increased demand in home improvement projects from buyers as well as sellers,” Lawrence Krimker, CEO of Simply Group and owner of SNAP Financial, said in a news release. “As new homebuyers looked to refurbish their houses, sellers also upgraded their properties to drive up the selling price.”
The lender expects those trends to continue, especially as winter months approach and people rush to upgrade roofs, windows and doors to keep out the cold. Indeed, the lender says loan applications for such essential upgrades already increased 36 per cent in the second quarter. And with natural gas prices predicted to rise this winter, even more Canadians could be considering renovations to make their homes more efficient.
“Our data reflects that Canadians continue to prioritize their home improvement plans in a financially viable way,” Krimker said.
Simply Group isn’t the only one predicting Canadians will take on more renovation projects this year.
A recent report from HomeStars indicates Canadians are poised to keep the spending going. It found that among homeowners who have already renovated during the pandemic, 77 per cent plan to make interior improvements within the next 12 months, and 51 per cent are planning an outdoor reno.
That comes even as supply chain issues push up prices for materials. Homeowners told HomeStars higher prices aren’t stopping them from renovating, with only 35 per cent saying price spikes have paused their plans.
