Postponing reno (interest rates) - Anyone else?

[May1984]

Basically that... we were expecting to borrow approx £60k to redo the kitchen and update the decor in the house. But have cold feet due to the interest rates being so high. Anyone else?

Not sure whether to wait one year (More? Less?)... or whether I will deeply regret that year wait if the rates keep getting higher than now!! Tell me how you are approaching it!

The rates are going to go up probably a few times but once inflation is under control they start to go back down again. Could you wait until then?

60k on a kitchen and a bit of painting is going to be money wasted in the current climate. I agree with caringcarer that rates have still a fair way to go up - but will eventually get a bit better. Now is not the time to take on more debt. Better to save toward what you want doing if possible and then hopefully borrow less at better rates.

This is quite a bold assumption - interest rates have been at historic lows and are unlikely to return to that level

Yes we are postponing. We did a loft conversion last year (although booked in Dec 2020 so we were very lucky with the price) but we were hoping to do a small extension plus knock through kitchen this year. We can live with what we have for now (it's functional but a small galley kitchen so not ideal layout when we have a toddler) then we are going to tighten our belts and see where things are in a couple of years before we decide whether to go ahead with the work.

We've paused some work. Primarily due to the cost of builders, but interest rates mean I don't want to borrow to get work done. I'm hoping demand for building work will dry up and builders will become relatively cheaper. In a year or two I could have saved for the work.

@coloursquare, bold? BoE base rate might go up to 8 1/2 but eventually should come back down to 5 or 5 1/2, I would have thought it's baked in, it's going up higher before it eases a bit. I don't think anyone is expecting it to go down to under 4 1/2 - 5 again.

Thank all!

Very helpful to see we are not the only ones. I'm also hoping that builders' costs go down when demand dries up as I think they have gone up much higher than inflation. I was hoping that when rates come back down the new normal might be around 3.5-4.5% but who knows.

If they were to settle around 5% - 5.5% not sure the waiting will be worth it unless cost of builders go down...also factoring in the lack of enjoyment during this time in my shambolic kitchen and tired looking home.. but yes, absent a crystal ball I suppose the sensible thing is to wait... sigh

Thank you everyone!

We are also putting it off for the same
reaaoms. We’re doing small improvement jobs ourselves to make it more pleasant!
I think the rates will also settle back to around 4%.
And I am also hoping that building work cost comes down. I had a friend who had a quote of 700k for a renovation which only had a small extension!

Pammela, ta! Very reassuring. And yes, same. We are doing bits and bobs and updating some furniture and accessories. I just didn't want to start with that before improving the actual canvas... I really wanted a full repaint, skirtings and floorings redone. (Kitchen cannot be helped but without a massive overhaul) But needs must. We updated a big piece of furniture in the bathroom and it actually made a big difference! Have to accept and embrace the situation!

Can you do the repaint yourselves anyway? That shouldn’t cost that much at all, and you could paint your skirtings etc rather than replace if you’re waiting for structural work.

My daughter and SiL are putting things on hold, apart from things that really need doing.

We are saving and doing jobs as and when we can afford to currently. It means the kitchen won't get done until next year and the horrible bathrooms will have to wait until the end of the year, we need to sort the flooring out now that the plumbing and rewire have been done.
I do not want to incur any debt going forwards.