It's the Room to Improve effect, and it could be having a dangerous impact on your wallet. Thanks to the popular RTÉ home-improvement programme, and the proliferation of interior design sites such as Houzz and Pinterest, more and more of us are knocking down walls and vacillating between Wimborne White and Pointing.
According to Bank of Ireland, the number of home-improvement applications soared by 38 per cent in the first quarter of the year, with applicants applying for an average loan of €12,000 over five years.
"The popularity of TV programmes like RTÉ's Room to Improve encourages homeowners to invest in their homes and put time and money into sprucing up the property. With summer approaching, we expect DIY enthusiasts to ramp up their renovation and home-improvement plans," said Christine Hamill, head of retail loans with the bank.
Revenue incentives
Another key incentive is the home renovation scheme operated by Revenue, which allows homeowners and landlords to claim back VAT expended on their renovation projects up to a value of €30,000. It means that homeowners can cut their tax bill by up to €4,050 in the two years following the work.
According to Bank of Ireland, it’s typically not recent first-time buyers applying for the loans. Seventy-seven per cent of all applicants are aged 35 or over, and more than a third are over 45. More than one in four (27 per cent) applicants were looking to borrow €10,000-€20,000, while a similar proportion (25 per cent) requested amounts greater than €20,000.
Homeowners are continuing the trend of making their homes larger: 12 per cent completing extensions in their homes. Kitchen and bathroom refurbishment and internal carpentry jobs accounted for 14 per cent of projects. Painting and decorating remain popular projects this year, generating 10 per cent of online inquiries, while landscaping accounted for 3 per cent, down on last year.
