How to save money on house renovation costs

author-avatar By on July 31,2019
How to save money on house renovation costs

Image by via Adobe Stock

Amid the recent falls in house prices around the country, many people are deciding to hold off from selling their properties and opting to renovate instead.

Adam Rigby, property expert and founder of Upside Real Estate, says now is a good time to make small improvements to your home if you are considering selling. 

“There’s a sliding scale of how much value you can create versus how much you spend,” Mr Rigby said.

“It’s no secret that styling your property pays off: our real estate agents estimate that it adds around 2.5% to the value of your home and it can also help your house sell faster.”

While you may have dreams of a grand renovation, your bank balance probably has other ideas. Renovating your home is always going to make a dent in your savings, but there are ways to save money on house renovation costs. 

How much does it cost to renovate a house?

The average Australian spends around $25,000 on house renovations, according to the Australian Bureau of Statistics (ABS), while the average reno costs between $600 to $2,700 per square metre.

If you’re on a shoestring budget or simply want to save money, these cost-cutting tips could help you save money on the costs of your home renovation. 

How to save money on home renovations 

Renovation expert Cherie Barber has been working with Allianz Australia to provide tips for renovating on a budget. We spoke with Ms Barber and Mr Rigby to discover their budget renovation tips. 

1. Refurbish and re-use

Avoid budget blowout by working with what you’ve already got. Ms Barber recommends painting over old tiles to give them a modern look instead of ripping them out and replacing them with brand new ones.

“Tiles are something that will eventually date, even when they’re still in good condition, and they can be expensive to replace. It’s a cheap, easy DIY solution for updating those old beige ‘70s tiles. Alternatively, you can bring professional tile resurfacing companies in but that will cost you substantially more,” she told

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Pictured: Cherie Barber. Image supplied.

Kitchens can be one of the most expensive parts of the home to renovate, but there are cost savings to be had.

“Why rip out a perfectly good kitchen, when the only problem is the drab, dated colour scheme? If the carcasses and doors have still got plenty of life left in them, then just choose a modern tint and get busy on the door fronts. Be sure to update the handles or knobs at the same time,” Ms Barber said.

If you can’t afford new furniture, Ms Barber says ‘up-cycling’ your old furniture can save substantial amounts of money. 

“A scruffy timber coffee table can be sanded and varnished, so it comes up like new. And a coat of paint can give any old furniture, like a bookshelf or side cabinet, a completely new personality.”

2. Don’t move the plumbing

If you’re planning a bathroom renovation, make a major saving by sticking with the original plumbing points. Moving anything involving electrical or plumbing fixtures will cost considerably more and blow out your reno budget. 

You can still upgrade everything – the key is to keep all the facilities in the same spot. The same applies to kitchen and laundry facilities. 

3. Cheap cosmetic fixes

If your budget doesn’t quite extend to making structural changes, simple cosmetic changes such as installing new lighting or changing the window furnishings can instantly make your home feel new.

“Old kitchens often have just one central light in the ceiling (often an oyster light) which isn’t a pretty or effective one at that. Depending on your budget, LED down-lights or track lighting is a neat, practical replacement. You can also install over-bench feature lighting and perhaps a trio of cool pendant lights over your breakfast bar or island bench. In a kitchen you ideally want a mix of general ambient lighting, task lighting and some feature lights,” Ms Barber said.

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You can also make a big impact through affordable updates like paint.

“For renovators, it’s liquid gold. If your kitchen is part of an open-plan layout, then you want to paint your kitchen and living spaces the same colour so the rooms flow seamlessly together. Always get a sample pot and paint generous swatches that you can view in daylight and night before you commit to ordering all your paint,” Ms Barber said. 

4. Improve the layout

You can make some structural changes without completely blowing the budget – the key is to avoid load-bearing walls.

“If there’s a simple gyprock or non-load-bearing wall boxing in your lounge room (separating your lounge room from an adjoining kitchen or dining room), simply removing a wall or two, can open up all your living spaces. Creating open-plan living is one of the key ways to add value. Once complete, ensure your home and/or contents insurance policy has been updated. This is a part of the process that many renovators forget, however, could save you money in the long-term,” Ms Barber said.

Ms Barber says even smaller cosmetic changes can make a big difference to the layout.

“It might be a matter of installing extra overhead cupboards or shelves; extending the kitchen with new floor cabinets, and perhaps installing longer benchtops. If it works within the space, a breakfast bar or island bench is a great value-add.”

According to Mr Rigby, the power of mirrors should not be underestimated.

“Mirrors are an inexpensive way to instantly give a feeling of space to a room. Try placing a mirror behind the sofa, or shelf in the living room, or behind the headboard in a bedroom. In dark hallways, they are a great way to add space and open up the walkway.”

5. DIY vs tradies

There are some jobs you really should leave up to the professionals – like waterproofing, electrical work or plumbing. But there are some jobs that don’t require any special skills, like painting or ripping up carpet.

If you can pull in some favours from friends and family, you can significantly drive down the cost of your home renovation. 

6. Use cheaper materials

Swapping to more affordable materials is an easy renovating win. It will save you money and it doesn’t have to affect the overall aesthetic of your renovation. 

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“You can do this very cheaply with products like water-resistant laminate floorboards or vinyl floor planks which quickly disguise old tiles or lino. These products mimic the look of real timber floorboards but are quicker, easier and less expensive to work with. They’ll instantly modernise any home,” Ms Barber said.

If you can’t afford a marble or granite benchtop, laminate or engineered stone can look just as good – and for a fraction of the price. 

7. Build a contingency into your budget 

If you’ve ever watched Love It or List It (or any home renovation show, let’s be honest) you’ll know that unexpected costs are an unavoidable part of the renovation process. Hidden damage such as asbestos, mould, shoddy wiring, rotting wood and termites can be costly, which is why it’s important to build a contingency into the budget to cover any unwelcome surprises. You never know what can arise during a project – particularly if you’ve got an older home. 

Unexpected delays can also occur, like a holdup in materials arriving or bad weather, which can consequently cost money. 

Having a buffer in your budget to account for this means you won’t need to skimp on other areas.

Home renovation loan options to fund your project

Unless you’ve got cash stashed away to fund your home renovation, you’ll have to explore other options to finance your project. We’ve rounded up a few different ways to fund your renovation project – depending on your situation and the extent of the renovation you’re planning.

Low rate variable home loans

Ad rate
Comp rate*
2.63% 2.65% $1,607 More details
2.78% 2.84% $1,639 More details

Base criteria of: a $400,000 loan amount, variable, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. The product and rate must be clearly published on the Product Provider’s web site. Introductory rate products were not considered for selection. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term. Rates correct as at 26 March 2020. View disclaimer.

1. Unsecured personal loan

An unsecured personal loan is essentially a loan that can be used to finance whatever you like – be it a holiday, a car, or home improvements. Unsecured personal loans generally come with higher interest rates and fees than other loans because there’s no guarantee (security) on these loans, and they’re more risky for the lender.

2. Secured personal loan

A secured personal loan allows you to borrow money by putting up an asset as security for the loan. If, for example, you’re doing a home renovation, you can put up your home as security for the loan. If you have a mortgage, you can use the equity in your home as a guarantee (the amount of equity has to be more than the loan amount). 

3. Mortgage finance

If you’ve already got a mortgage, you could up your mortgage amount to finance your home renovation. If your mortgage has a redraw facility and you’ve made extra repayments, you may also want to consider using that to fund your renovations.

4. Construction loan

If you don’t have enough equity in your home, you may want to consider a construction loan. A construction loan is typically based on the estimated final cost (post-renovation) value of your property, which allows you to withdraw whatever amount you need in order to pay the latest renovation-related invoice that has come in. 

Keep in mind that construction loans are typically used for major renovations (such as adding new rooms or making big structural changes to the property) – not for minor cosmetic changes. 

Compare construction loans

Ad rate
Comp rate*

Base criteria of: a $400,000 loan amount, variable construction home loans with an LVR (loan-to-value) ratio of at least 80%. Introductory rate products were not considered for selection. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term. Rates correct as at 26 March 2020. View disclaimer.’s two cents

When you’re renovating your home, chances are you won’t have an unlimited budget to play with. But renovating doesn’t need to be expensive – it just requires you to think outside the box.

Start your renovation with a plan and a budget to avoid overspending on your home renovation.


The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2019. They are (in descending order): Credit Union Australia, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2019) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, and are part of the Firstmac Group. To read about how manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

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Emma joined as a Finance Journalist in 2019. She is a journalist with more than five years experience across print, broadcast and digital media, with previous stints at Style Magazines, 4ZZZ radio, and as editor of The Real Estate Conversation. She's most passionate about improving the financial literacy of young women and millennials by writing about complex financial topics in a way that's easy for the average Joe (or Jill) to understand. When she's not writing about finance she's watching Greys Anatomy (again).

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