Home improvement loans: how to plan and pay for your project
Thinking about changing your home, fixing a problem or making more space?
This guide can help you plan the work, understand the costs and decide if borrowing could be right for you.
Last updated: 26/10/2026
Why planning ahead matters
Home improvements can feel exciting. They can also feel like a lot to sort out, especially when costs, quotes, permissions and timescales start adding up.
What’s more, the cost of home improvements can change over time. The Building Cost Information Service (BCIS) forecast in July 2026 that building costs would rise by 13.1% over the next five years. Tender prices were expected to rise by 15.5% over the same period.
That’s why it’s worth planning carefully before you book work, buy materials or apply for credit. A bit of planning now can help you avoid stress later. It can also help you borrow only what you need, if you decide a loan is the right way to go.
What this guide covers
Some projects are about making a home feel better. Others are about keeping it safe, warm and working as it should.
You might want a new kitchen, bathroom or loft conversion. Or you might need to replace a boiler, repair a roof or make your home easier to live in.
This guide covers the main things to think about before you start, from common project types and likely costs to budgeting, borrowing options, permissions and ways to make your money go further.
People improve their homes for many reasons. You may want more space, a nicer bathroom, a warmer home or a kitchen that works better. You might also need to fix something urgent, like a leaking roof, broken boiler or unsafe wiring.
For some people, improving their home can feel easier than moving. Moving can mean estate agent fees, legal fees, removals, stamp duty and the cost of making a new place feel right.
Official data shows repair and maintenance work is still a key part of the construction sector. The Office for National Statistics reported that repair and maintenance grew by 1.4% in Quarter 2 of 2025.
Not every project needs to be big. Practical changes like better insulation, safer electrics, improved heating or stronger storage can make daily life easier.
What is a home improvement loan?
A home improvement loan is usually a personal loan. You borrow a set amount, then pay it back in fixed monthly payments over an agreed time.
People often use this type of loan for repairs, updates or bigger home projects.
You might use one for a new kitchen or bathroom, a loft conversion, roof repairs, better heating, safer access, decorating or work that makes your home warmer.
A Post Office home improvement loan lets you borrow £1,000 to £25,000 over 1 to 5 years. You can check your eligibility online without affecting your credit score.
This guide helps you think it through before you decide whether to borrow.
A home improvement loan could help if you want to spread the cost of work rather than pay for everything upfront.
That might suit you if the work is urgent, important or too costly to cover from savings alone.
Emergency repairs
Some home improvements aren’t really about choice. A broken boiler, leaking roof, unsafe wiring, damp problem or damaged window may need sorting quickly.
Before borrowing, check whether your home insurance covers any of the work. If it does not, get a clear written quote so you know what you’re likely to spend.
It’s also worth checking whether the repair is part of a bigger issue. Fixing visible damp, for example, may not solve the problem if the cause is poor ventilation, damaged brickwork or a leak.
Changes that make life easier
Your home might need to change because your life has changed. For instance, you might need:
A better space to work from home
A safer bathroom
A bedroom downstairs
Adaptations to your home to help you get around
More storage
A warmer home with lower running costs
More room for family members
These changes don’t always need a large renovation. Sometimes smaller updates, such as better lighting, safer flooring or new storage, can make a real difference.
Bigger projects that change how you use your home
A larger project can change how your home works day to day. That could mean opening up a kitchen, converting a loft, adding a bathroom or building an extension.
Before you get too far in, ask one simple question: what problem will this work solve? If the answer’s clear, it’s easier to make good choices on budget, materials and timescale.
Popular home improvement projects
The best home improvement project isn’t always the biggest one. It’s the one that solves the right problem for your home, your budget and your day-to-day life.
Kitchens
Kitchens are often one of the biggest home projects because they bring together units, worktops, flooring, lighting, appliances, plumbing and electrics.
A full kitchen renovation can change how you cook, eat, store things and spend time together. It can transform how you live in your home. But you may not need to replace everything.
Before you start, ask:
Can I keep the layout and update the finish?
Do the appliances still work well?
Could new doors, handles, lighting or worktops be enough?
Will any walls, pipes or electrics need moving?
Keeping the same layout can often help control costs, because big plumbing and electrical changes can push the price up.
Bathrooms
A bathroom update might be a full refit or a smaller refresh with new fixtures, tiling, lighting or storage.
Hidden costs can appear once old fittings come out. You may find damp, rotten flooring, old pipework or wiring that needs attention.
If the bathroom needs to work for children, older relatives or anyone with mobility needs, think about access as well as style. A walk-in shower, slip-resistant flooring or better lighting could be worth planning in early.
Loft conversions
A loft conversion can create a bedroom, office, playroom or quiet space without moving home.
Costs can be high and the work can be more complex than it looks. Roof structure, head height, stairs, insulation, fire safety, windows and planning rules can all affect what’s possible.
A loft project may also need building regulations approval. It may need planning permission too, depending on the type of conversion, your property and where you live.
Extensions and conservatories
An extension or conservatory can add living space and change how your ground floor works.
A conservatory may be useful for extra sitting space or a brighter link to the garden. An extension may suit you better if you need a larger kitchen, dining room, home office or accessible living space.
Costs can go beyond the build itself. You may also need planning, design, structural calculations, building control, groundwork, drainage, heating, flooring and decoration. You may also have to adapt your outdoor space after the main construction work’s completed.
Energy-saving upgrades
Energy-saving work can help make your home warmer and may help lower running costs. That could include insulation, draught proofing, heating upgrades, better windows or low carbon heating.
The Energy Saving Trust guide to energy grants and financial support says support for home energy can include improvements such as cavity wall insulation, solid wall insulation, loft or roof insulation, floor insulation, energy-saving doors and windows, draught proofing and heating controls.
It also says support can depend on where you live in the UK, whether you own your home and whether you claim certain benefits.
How much do common home improvements cost?
Costs vary by home, area, materials, labour and how much work is needed behind the scenes. Treat guide prices as a starting point, not a quote.
The BCIS July 2026 construction industry forecast is a useful reminder that building costs can move over time. It forecast building costs to increase by 13.1% and tender prices by 15.5% over five years.
Get more than one written quote and check what each one includes.
How much does a new kitchen cost?
As a guide:
Kitchen type
Typical cost
Budget renovation
£8,000 to £15,000
Mid-range renovation
£15,000 to £30,000
Bespoke or luxury renovation
£30,000 to £60,000
You don’t always need everything new. Could you keep the oven, hob or fridge-freezer? Could you repaint units, add new handles or change the worktop?
DIY can save money if you have the right skills. But be ready for surprises like pipework, wiring or flooring that needs extra work. Add a buffer to your budget.
How much does a new bathroom cost?
Bathroom costs depend on size, fixtures, flooring, tiling, lighting, plumbing, electrics and labour. Material quality and whether you DIY or hire help also matter.
As a guide:
Bathroom work
Typical cost
Budget bathroom
£1,500 to £4,500
Mid-range bathroom
£4,500 to £9,000
Luxury bathroom
£10,000 to £20,000
Basic fixtures
£400 to £800
Mid-range fixtures
£1,200 to £2,500
Premium fixtures
£3,000 to £6,000
Always allow extra for unexpected work once old flooring, tiles or fittings come out.
How much does a loft conversion cost?
A loft conversion can typically cost £45,000 to £120,000, depending on the home and the type of conversion.
Some guide prices by extension type are:
Loft conversion type
Typical cost
Velux or rooflight conversion
£18,000 to £30,000
Dormer conversion
£50,000 to £60,000
Hip to gable conversion
£45,000 to £75,000
Mansard conversion
£55,000 to £85,000
Other costs may include stairs, insulation, glazing, fire safety work, flooring, heating, decorating and furniture. You may also need planning permission or building regulations approval.
How much does a conservatory cost?
The cost of a conservatory depends on its size, style, materials, glass, heating, groundwork and how you want to use the space. As a guide, a conservatory can cost anywhere from £5,000 to £30,000.
Here are some guide prices for different types of conservatories:
Conservatory type
Typical cost
Lean-to conservatory
£7,000 to £11,000
Victorian conservatory
£13,000 to £18,500
Edwardian conservatory
£12,000 to £16,500
Check early whether you need planning permission, building regulations approval or extra groundwork.
How to budget for a renovation
A good home improvement budget should cover the work itself and the costs around it.
Break your budget into:
Labour
Materials and fittings
VAT
Waste removal
Scaffolding
Surveys, plans or structural work
Planning or building control costs
Temporary costs, such as eating out during kitchen work
A buffer for surprises
A contingency fund can help if prices change or the builder finds something unexpected.
Also separate your essentials from your nice-to-haves. If costs rise, you’ll know what to protect and what to cut back. For example, safe wiring and good ventilation should come before premium taps or designer tiles.
Ways to pay for home improvements
There isn’t one right way to pay for home improvements. The best choice depends on the work, how urgent it is, what you have saved and what you can afford to repay each month.
Start with your budget. Work out the full cost, add a buffer for surprises and check whether savings, credit or a loan would suit your situation.
Savings
Savings can be a good option if you have enough set aside and the work will not leave you short for emergencies.
If using all your savings would leave you exposed, you might decide to use savings for part of the project and borrow the rest.
A credit card may suit smaller essential costs, especially if you can repay within any interest-free period.
It may not work as well for larger projects if your credit limit is too low, the rate is high meaning you could end up paying more, or the work takes longer than planned.
A card may also help with specific parts of a project, such as materials or appliances, if the supplier accepts card payments and you have a clear repayment plan.
A personal loan can give you one lump sum and fixed monthly payments. That may help when you know the size of the job and want a clearer repayment plan.
Some homeowners consider remortgaging to release money for larger work.
This may spread the cost over a longer time, which could make monthly payments lower. But it may also mean paying more interest overall. You may also need to pay fees.
If you’re thinking about this route, get advice and compare the full cost with other forms of borrowing.
Secured borrowing
Secured borrowing uses your home as security. It may let you borrow more, but it comes with greater risk because your home could be at risk if you cannot repay.
Unsecured personal loans, like Post Office home improvement loans, don’t secure the borrowing against your home or property.
This is where good planning can save you more than you expect.
Get more than one quote
Don’t go with the first quote unless you have a strong reason to. Ask several tradespeople for written quotes and compare them like for like. And check whether each quote includes:
Labour
Materials
VAT
Waste removal
Scaffolding
Making good after the work
Start date and timescale
Payment schedule
If one quote is much cheaper, ask why. It may be missing something important.
Choose contractors carefully
Ask local people for recommendations, especially if they live in a similar age or type of property.
Look for recent reviews, photos of similar work, insurance and trade membership where relevant.
Be careful if someone pushes for a quick decision, asks for large cash payments upfront or offers to do work VAT-free.
Use a written contract
A written contract helps everyone understand what has been agreed. It should cover the work, materials, payment stages, timings, responsibilities and what happens if plans change.
For larger work, you may want to hold back a small final payment until any minor issues have been fixed.
Decide what to DIY
DIY can cut costs, but only if you have the right skills and time.
Painting, simple tiling, flat-pack furniture or small garden work may be realistic. Plumbing, electrics, structural work and gas work usually need qualified professionals.
Poor DIY can cost more to fix than getting the right person in at the start.
Reuse what you can
You may be able to keep more than you think.
In a kitchen, you might reuse appliances, keep the layout or update doors rather than replacing every unit. In a bathroom, you might change taps, storage, lighting or flooring instead of doing a full refit.
Small choices can help your money stretch further.
What to check before work starts
Good planning can save money, time and stress.
Planning permission and building regulations
Planning permission and building regulations are different checks. GOV.UK explains the difference is that planning permission looks at whether work can go ahead, while building regulations cover how the work must be done.
Some work may need approval, including bathrooms, boilers, electrics near baths or showers, replacement windows, roof work, wall insulation and some heating changes.
If your project is about making your home warmer or cheaper to heat, check grants and local support before borrowing.
According to the Energy Saving Trust, support for home energy can vary by where you live in the UK, whether you own your home and whether you claim certain benefits.
Its guidance says support may include cavity wall insulation, solid wall insulation, loft or roof insulation, floor insulation, energy-saving windows and doors, draught proofing and heating controls.
Can home improvements add value?
Some improvements may add value to your home, but it's not guaranteed.
A loft conversion, extension, new kitchen or better bathroom may make a home more attractive. Repairs can also protect value by stopping problems getting worse.
But the local housing market matters. So does the condition of your home, the quality of the work and what similar homes nearby are worth.
Before spending heavily, ask:
Am I improving this home for myself or for a future buyer?
Could I recover the cost if I sold?
Would a local estate agent give me a view on likely value?
Am I over-improving compared with nearby homes?
If you plan to stay for years, comfort, safety, warmth and space may matter more than resale value.
Key takeaways
Start with the problem you want to fix
Get more than one quote and add a buffer
Check costs for the type of work you want, such as a kitchen, bathroom, loft conversion or conservatory
Compare savings, credit cards, loans and other borrowing options before you choose
Check planning rules, building regulations, insurance and grants before work starts
Start with written quotes, then add any fees, materials, temporary costs and a buffer for surprises. Borrowing more than you need can increase your monthly repayments and the total amount you repay.
Using savings may be cheaper because you won't pay interest. But using all your savings could leave you short if something else goes wrong. A loan may help if the work is urgent or you want fixed monthly repayments. Compare the full cost before deciding.
It depends on the work. Planning permission and building regulations are separate, and you may need one, both or neither depending on the project. Check before work starts.
Get more than one quote, compare what’s included, reuse what you can and decide what really needs replacing. You might also split the work into stages so you can pay for some now and some later.
Get written quotes, check recent reviews, ask about similar work and agree the payment schedule before work starts. For larger projects, use a written contract.
Pause and update your budget before agreeing to extra work. Check whether the extra cost is essential, whether you can use savings or whether you need to change the project.
