SAN MATEO, Calif., Aug. 13, 2019 /PRNewswire/ -- More than two-thirds of U.S. homeowners who already carry significant debt are planning home renovations, with most intending to finance the projects with credit cards or personal loans.
The findings are from a new Freedom Debt Relief survey detailing American homeowners' plans for home renovations. The poll, conducted by Atomik Research, surveyed 1,028 U.S. homeowners with at least $10,000 in unsecured debt. A summary of the results, and a downloadable copy of the survey's raw and generational breakouts, are available.
According to the survey, more than two-thirds (69%) of the homeowners plan on renovating their home in the next five years – even though 60% of homeowners say they are unable to afford needed upgrades to their house. Overall, 73% of homeowners planning home renovations intend to fully finance their home renovation project with a debt-based financial product:
- 38% plan on using a credit card to finance all or part of their home renovation.
- 32% plan on using a personal loan.
- 26% plan on using a home equity line of credit (HELOC).
- 40% plan on using a home equity loan (HEL).
"The survey shows that homeowners who are carrying credit card and other types of debt – including student loan debt – in addition to their mortgage are more likely to finance their home renovations with a home equity loan, credit card or personal loan," says Michael Micheletti, director of corporate communications for Freedom Debt Relief. These plans have the potential to drive the total amount of homeowner debt ever higher, he explains. "Homeowners would be wise to save as much as possible, and look at their overall financial position before taking on even more debt – debt that could disrupt their bigger financial picture."
Renovation spending estimates, project plans
Twenty-six percent of homeowners plan on spending more than $25,000 on renovations in the next five years. Another 25% plan on spending between $5,001 and $10,000.
- 56% said they will do flooring renovations.
- 53% plan on bathroom renovations.
- 51% plan on doing kitchen renovations.
- Landscaping, new windows, fencing and roofing came in as the next most-popular planned renovations.
Significant generational differences
- Timeline: Ninety-one percent of Gen Z homeowners plan on renovating their home in the next five years, compared to 78% of Millennial homeowners, 69% of Gen X homeowners and 53% of Baby Boomer homeowners.
- Project: Kitchen renovations lead the list for Gen Z, with 70% planning on the project. Just over half (52%) of Millennial homeowners plan a kitchen renovation, while 53% of Gen X and 44% of Baby Boomers do.
- Financing: Forty percent of Gen Z homeowners plan on using a credit card to finance their renovation projects, versus 36% of Millennials, 21% of Gen X homeowners and 23% of Baby Boomer homeowners. Personal loans are favored by the Silent Generation (33%) and Millennials (31%), compared to just 10% of Gen Z, 13% of Baby Boomer and 20% of Gen X homeowners.
Freedom Debt Relief
Co-founded by Andrew Housser and Brad Stroh, Freedom Debt Relief part of Freedom Financial Network, LLC, a family of companies providing innovative solutions that empower people to live healthier financial lives. For people struggling with debt, the custom Freedom Debt Relief program offers the chance to significantly reduce and resolve what they owe more quickly than they could on their own. For more information about the company and its services, see www.freedomdebtrelief.com/faq.
Headquartered in San Mateo, California, Freedom Debt Relief also operates an office in Tempe, Arizona, and employs more than 2,400. The company has been voted one of the best places to work in both the San Francisco Bay area and the Phoenix area for several years.
Contact: Michael Micheletti, [email protected] or 415-359-6985.
SOURCE Freedom Debt Relief