The Bank’s new research shows that loans for home improvements accounted for 28 per cent of all personal loans in 2012. Indeed, some 624,235 people took personal loans to improve their homes in 2012, an increase of 22.8 per cent year-on-year (up 115,961). This significantly outpaces the increase in mortgage lending, which rose by just 1.4 per cent in 2012, according to figures published by the Council of Mortgage Lenders.
In addition to an increase in the number of borrowers, the figures from Sainsbury’s Bank Loans also show that the amount people are borrowing to improve their homes has also increased. In 2011, the average amount was £8,792, while in 2012 this rose 2.6 per cent, or £233, to £9,024.
Steven Baillie, Head of Loans at Sainsbury’s Bank said: “Our research shows that, year-on-year, more people are looking to invest in their property and carry out home improvements. As well as the obvious improvements to standard of living, home improvements can add real value to a property. We’d encourage those planning work to shop around to ensure they see the best possible return on their investment”
“The personal loans market has become increasingly competitive, which is great news for those seeking a loan, so we’d encourage shopping around to ensure getting the best deal. We are currently offering our lowest ever rate of 5.1 per cent APR on loans between £7,500 and £15,000.”
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