Home Improvement Loans

Before you start a home renovation project, it's a good idea to consider the following:

• How long will you be in your home?

  If you plan to stay for several years, your needs and desires for your living space usually become more important than adding resale value.

  On the other hand, if your main aim is to boost your home's resale value, you'll probably want to perform the work that offers the best potential payback. You don't want to put money into renovations that buyers won't pay for.

  Also check out the amenities in other houses in your neighbourhood. It's good to bring your home up to par with others nearby—but you don't want your renovations to make your home the most expensive on the street. Ask a real estate agent for help with the decision-making process.

• How will you pay for the renovations?

  If you plan to stay for several years, your needs and desires for your living space usually become more important than adding resale value.

  Ideally, you would pay in cash, but before you liquidate assets, do the math: depending on the type of investments you hold, cashing out may not be in your best interests. You may find that the costs of financing are lower.

Your personal style can transform your house or condo into your true “home.” But which changes or renovations make the most sense when it comes to building value in your home?

Below are the top 10 home improvement projects that result in a higher average payback^† at the time of sale:

1. Bathroom (75-100%)
2. Kitchen (75-100%)
3. Interior Painting (50-100%)
4. Exterior Painting (50-100%)
5. Roof Shingle Replacement (50-80%)
6. Furnace/Heating System (50-80%)
7. Basement Renovation (50-75%)
8. Recreation Room Addition (50-75%)
9. Installing a Fireplace (50-75%)
10. Flooring (50-75%)

A home energy audit is a report generated by a licensed professional who is specially trained to examine your home's major heating and cooling systems. He or she will make recommendations to help you improve your home's energy efficiency and lower your energy costs. You can then decide what you want to do and how much you want to spend.

At RBC Royal Bank, you could save money on your home energy audit through one of these financing options:

• RBC Energy Saver Loan^1disclaimer

  Receive 1% off the loan interest rate or a $100 rebate on a home energy audit on a fixed rate instalment loan over $5,000 when you purchase eligible products or services.

Plus, when you complete a home energy audit, you may be able to receive additional government rebates and incentives:

• Complete some or all of the suggested renovations and improvements and have your home auditor return to verify the work. Your auditor will submit an application on your behalf to both the federal and provincial governments.
• Ask your municipal government if similar incentives and rebates are available in your community.

For additional information:

• Government incentives and rebates
• ENERGY STAR information
• Ontario Power Authority

For more information about the energy audit process, benefits and scheduling an appointment with a qualified energy advisor, visit My Energy Audit

From quick and easy things you can do today to projects that require the help of a professional, there are many ways to make your home more eco-friendly. The list below will give you some ideas on how to improve your home's energy efficiency and save you money.

Tier 1: Estimated Annual Savings = $20–50

• Install low-flow faucets and shower heads to decrease water usage and reduce the cost of heating water by up to 50%
• Choose energy-efficient appliances
• Install outdoor motion detector switches
• Replace air conditioner and furnace filters regularly

Tier 2: Estimated Annual Savings = $50–100

• Use power bars to switch off your electronics
• Switch to compact fluorescent light bulbs
• Install a programmable thermostat

Tier 3: Estimated Annual Savings = $100–250

• Caulk all windows and make sure your home is properly insulated
• Use ceiling fans year round to help circulate warm and cool air evenly around a room^{(2)disclaimer}
• Replace an old refrigerator with an energy-efficient one (this can save enough electricity to light the average home for more than four and a half months)

Tier 4: Estimated Annual Savings = $250+

• Replace your existing windows and doors with energy-efficient designs that will reduce your home's energy use (both heating and cooling)
• Replace your existing furnace with a high efficiency furnace. They have increased safety (for newer airtight homes), longevity and there is no need for a chimney.

In addition to the loans, lines of credit and other financing options offered by RBC Royal Bank, you may be able to take advantage of additional outside incentives, rebates, subsidies or tax credits for your home improvement project.

To learn whether your home improvement project is eligible for subsidies or tax credits provided by provincial and federal government programs, check with your municipal office or look in the Blue Pages of your phone book, under "information on Federal Programs and Services." As well, Canada Mortgage and Housing Corporation (CMHC) offers programs for low-income Canadians, people with disabilities and Aboriginal Canadians.

For more information, visit the Canada Mortgage and Housing Corporation