Renovation plays a major role in the economic prosperity of our province. Last year over 170,000 jobs were attributed solely to the home renovation and repair industry. It generated 9.1 billion dollars in wages and represented over 23 billion dollars in investment value. Locally this industry created 6,200 jobs and generated 340 million dollars in wages.
Residential renovations actually surpass new home construction in total dollar value. A recent survey by Canada Mortgage and Housing Corporation revealed that an average of 37 percent of Canadian households spent money on renovations in the past year. In Ontario new home construction saw an investment of just over 16 billion dollars. It is apparent from these statistics that the renovation industry is a key component in the wellbeing of a flourishing economy.
Renovations fall into two groups – alterations and improvements and maintenance and repairs. Alterations and improvements are defined as any work performed to add value or extend the useful life of a property while maintenance and repairs are defined as any work required to keep a property in working order or to maintain its appearance.
Of the renovations performed 75 percent of the households had a form of alteration or improvement completed, while 46 percent of the households had maintenance and repairs completed and 21 percent had both types of renovation completed.
The CMHC report also concluded that the primary reason for renovating was to update a home, add value to a home or in anticipation of selling a home. The next most popular reason is the home needed repairs. Overall, 11 percent of renovations were performed by 25-34 year olds, 21 percent by 35-44 year olds, 28 percent by 45-54 year olds, 23 percent by 55 to 64 year olds and those over 65 years of age accounted for 15 percent of all renovations.
The average cost of a renovation according to the CMHC report was almost $14,000 with 81 percent of households paying for the renovation, at least partially, from savings. Fifteen percent financed their projects through a mortgage while 11 percent financed their projects with the help of a line of credit or credit card. A large majority of renovating households – 68 percent in fact used only savings and did not see their debt level increase as a result of renovating.
Of those surveyed 48 percent reported that their renovation was on budget and 37 percent went over budget. Thirty five percent of the renovated households contracted out all of the work, 30 percent performed some of the work themselves and contracted the remainder and 29 percent completed all of the work themselves. Eighty three percent of the respondents had a written contract for the work.
All of the statistics support the fact that the renovation industry is an integral part of a prosperous economy. While maintenance and repairs are deemed necessary, alterations and improvements are completed at the discretion of the homeowner. A healthy renovation industry usually translates into a healthy economy.
Consultation with a professional renovator is critical for all of your renovation needs. A reputable contractor will provide you with a written contract and proof of proper insurance and they adhere to strict building codes and regulations. As a homeowner, due diligence is ultimately your responsibility and when shopping for a contractor, I strongly urge you to seriously consider using an approved LHBA RenoMark contractor.
The renovation industry is thriving not only in London but all across Canada. If people are willing to spend money on home additions and improvements they are obviously confident in our economic future. Clearly there are a huge number of homeowners in London and across Canada who agree that a professional renovation is a sound investment.