Kitchen Remodels Are Most Regrettable Home Improvement — Where Homeowners Run Into Financial Trouble
Nearly one-third of homeowners who remodeled their homes between March 2020 and January 2022 and went over budget by more than $50,000 regretted their decision, according to a three-part survey from Lantern by SoFi.
Remodeler’s remorse wasn’t as prevalent in the general population, the survey said. Only 9% of all homeowners who remodeled during the pandemic said they regretted it. Most people — 59% — spent less than $20,000 on their remodeling project.
Spending big on the remodel didn’t necessarily lead to remorse, however. Those who spent $50,000 or more on their project — but intended to spend that much and stayed within their budget — said they were happier than those who spent less. Of that group, 85% said they would remodel again and 53% gave their level of happiness with the remodel the highest rating, compared to only 27% who spent $10,000 or less.
In essence, it’s all about budgeting, and sticking to that budget while ensuring your remodel meets your expectations. Overall, 92% said they felt the remodel helped increase the price of their home.
So, what were the biggest mistakes among homeowners with regrets?
Seventy-five percent who regretted the remodel embarked on the massive undertaking of remodeling their kitchen. Sixty-two percent of home remodelers with regrets said the project took longer and cost more than expected. Kitchen remodelers ran into supply chain issues, lack of skilled laborers available to complete the work and unexpected problems that had to be fixed before proceeding with the original plans. Of those surveyed, nearly 55% said their kitchen remodel cost more than expected, in part due to these factors.
Based on other research, the cost of a kitchen remodel will only continue to rise. Another survey from Realtor.com, previously reported by GOBankingRates, showed that homeowners are spending 25% more to renovate their kitchens in 2022 than they did in 2021.
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Finally, 42% who used a credit card regretted the choice — especially in light of rising interest rates that could mean the remodel will cost them even more than they planned if they don’t pay off the balance quickly.
Avoiding regrets with your remodel doesn’t mean steering clear of a kitchen renovation or only paying for the remodel with money you have saved for the project, however. It just means planning ahead, being aware that inflation could increase the costs of raw materials and fixtures and planning for an extra 50% in both costs and time, SoFi experts said.
You could also consider a home equity loan, home equity line-of-credit or personal loan to pay for remodeling costs. “We recommend keeping personal loans in mind because they offer extra benefits such as lower interest rates, higher borrowing limits and flexible repayment terms,” a SoFi representative said in an email to GOBankingRates.
You can also save substantial money by doing the renovation yourself. You will have opportunities to hunt down secondhand bargains on Facebook Marketplace and Craigslist. But, the SoFi experts said, “Do it when you have plenty of time […] because there’s always something that’s going to go wrong.”
Do-it-yourself projects don’t have to be an all-or-nothing proposition, either. You can hire experts for a portion of the job — for instance, hanging drywall and spackling — and take care of the painting yourself.
If you’re not a do-it-yourselfer or don’t have the time for such a project, hire experts with care. Read reviews, but also ask your local neighbors for personal references. In today’s economy, many contractors are overcharging for low-quality work, said the SoFi experts.
Ultimately, however, a home renovation is nothing to fear, according to those surveyed. Even among the 9%, total, who said they regretted the remodel, 52% said they would “definitely remodel again.”
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