You’ve spent the better part of winter inside examining every square inch of your house. With warmer weather approaching, it’s time to make some much-needed renovations and repairs. If you’re wondering home much do home renovations cost, then you might be in for some sticker shock.
The good news is that you can probably afford these renovations with the value (or equity) you already have built up in your home. A home equity loan or home equity line of credit (HELOC) let’s you borrow money, usually at a lower rate than other loans. You’ll be able to fix up your home and maybe even increase its value while paying less in interest.
Quick links:
How much can I borrow from my home?
Home equity is the difference between the value of your home and what you still owe on your mortgage. Technically, it’s the portion of your home that you’ve paid for and own.
Most lenders will let you borrow between 60 to 80 percent of your built up equity. At Arsenal Credit Union, you can borrow up to 100 percent of your home’s equity – a unique perk that lets you borrow more money and tackle more home projects at a lower interest rate.
Learn more about home equity loans
How much does a home equity loan cost?
Because you’re using your home as collateral, a home equity loan or line of credit gives you a lower interest rate than other types of loans. While these types of loans are great for completing home repairs and renovations, a lot of people use them to consolidate higher interest debt at a low rate.
Most lenders will charge you for closing costs on a home equity loan or line of credit. These typically include appraisal, title, flood certification and recording fees. They cost between $500 to $1,500. At Arsenal, you don’t have to pay any closing fees as long as you don’t pay off your loan within the first 12 months.
What are the benefits of using a HELOC?
Home equity loans and HELOCs are very similar, but come with a few differences. You’ll get a set, low rate on a home equity loan and your funds in a single lump sum.
HELOCs feature variable rates that change with the market. You’ll receive a line of credit you can access through checks or online + mobile banking that you can “draw” on when you need it. Your rate will fluctuate, but not by much, throughout the life of the loan.
A HELOC lets you tackle projects as they pop up. You could potentially use your HELOC to finance a new kitchen upfront, then draw on it again if you decide you need all new appliances.
How much do home renovations cost?
The cost of your home renovation depends on the size and scope of your project and the cost of living in the area where you reside. Below we’ll outline some averages of the most common home improvement projects.
Installing a new kitchen
A new kitchen remodel can cost anywhere from $10,000 to $60,000, depending on the quality of materials you purchase. A mid-range remodel will typically cost between $25,000 to $50,000. The larger your kitchen, the more it will cost to remodel.
One of the biggest expenses of a kitchen remodel is cabinetry. If you decide to install custom cabinets, your cost will be much higher. For countertops, builder-grade materials will be cheaper, while premium materials like granite and marble will be much more expensive. If you plan to change the layout of your kitchen, you’ll likely incur additional plumbing and electrical costs.
Completing a bathroom remodel
A new bathroom remodel usually costs between $5,000 to $20,000, depending on the size of the bathroom and the quality of materials you use. The national average cost for renovation is around $12,000. Your cost also depends on the type of bathroom you’re remodeling:
- Half bathroom: $2,000 to $5,000
- Full bathroom: $5,000 to $20,000
- Master bathroom: $7,000 to $30,000
Outdoor home improvements
One of the biggest advantages of using a HELOC is that you can borrow when you need it. Because the weather is unpredictable, you’ll never know when you’ll need to fix part of your home’s exterior. Below are the prices for some of the most common outdoor home projects:
- New roof: The average cost for a new roof falls between $5,000 to $11,000, with the average cost being $8,000.
- New siding: For a 1,500 square foot home, the cost may only be $4,375. For larger homes, the price could reach close to $30,000 depending on what materials are used.
- New gutters: The average for a new gutter system in St. Louis is $1,455, with a high end of $2,710.
- New fence: Typically between $3,000 to $7,000 dollars depending on the material used and the square footage.
- New windows: Each new window you install could cost between $200 to $2,500 depending on the materials you choose.
What are the benefits of completing home renovations?
Once you complete a home renovation, you’re the proud owner of a beautiful new space! You live in your home and get to use your new space however you see fit. Isn’t that good enough?
Oh, and also, your new renovations can increase the value of your home when you go to sell. When you complete the renovation, you could get more money from your home. Many homeowners find that they’ll be able to make a profit and move into a better home with the cash they receive when they sell. It’s possible that this extra cash could offset what you borrow using your home equity loan or line of credit.
Learn more about home equity loans
