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Homeowners Staying Put Fuels a Renovation Boom, Home Improvement Loan Opportunity

There’s a saying in real estate: “Marry the house, date the rate.” In today’s market, though, many homeowners are experiencing the flipside. After years of historically rock-bottom rates, homeowners needing or wanting to move face a conundrum: Twist and take on a much higher rate, or stick and invest in the property?

It’s a difficult decision for any member, but could be a win-win for credit unions.

The Renovation Boom

A growing number of Americans are opting to improve their current home rather than brave the market for a new one. According to the 2025 U.S. Houzz & Home Study, more than half (54%) of homeowners undertook renovation projects in 2024, and an additional 52% plan to renovate this year. While activity has dipped slightly from pandemic-era highs, it remains historically strong and far from slowing.

LendKey Reno Quote "More than 54% of homeowners undertook renovation projects in 2024.

Spend is up, too. Homeowners aren’t just repainting the guest room. They’re investing in serious upgrades: The median spend on a kitchen remodel in 2024 was $22,000, while major renovations of large kitchens clocked in at twice that amount.

Contractors and Pros Serve as Linchpins

For these projects, 90% of renovating homeowners hired professionals in 2024 (Houzz). That makes contractors more than just craftspeople—they’re frontline advisors at the moment when members are making seismic decisions.

Of course, the ease of securing financing is still just one aspect members consider. When remodeling budgets soar, trust is still critical. A recent home equity trends survey saw 43% of homeowners cite trust and reputation as top factors in choosing a lender; a metric credit unions traditionally score highly on.

Cash Remains King, But Lower-Rate Options Get a Second Look

In 2024, 84% of homeowners used savings to finance renovations, though trends indicate there’s an opportunity for other financing alternatives to claim more market share.

Credit card usage for renovations dropped by 8% year-over-year, signaling a shift toward lower-rate options. Heading in the other direction, HELOCs are on a years-long upward swing, but can take weeks to finalize, with many credit unions still requiring paper applications. That’s not how homeowners want to finance a $50,000 kitchen upgrade in 2025.

Renovation financing data for 2024

Modern members want financing that’s as easy to use as it is flexible. Credit unions need to have that solution if they’re going to deepen–or just retain–their member relationships.

Don’t DIY Home Improvement Loans

This renovation boom is a massive opportunity for community-based lenders, but only if they can meet consumers’ expectations. Borrowers want low rates, digital-first experiences, and personalized terms. Legacy loan products, outdated tech stacks, and over-capacity teams won’t cut it.

That’s precisely where LendKey’s Home Improvement Loan platform excels. With fast approvals, industry-leading terms, and disbursements that go directly to the contractor, credit unions can capitalize their community, deepen member relations, and remove the friction of manual decisioning.

For credit unions looking to grow market and wallet share with new and existing members, home improvement financing is a relevant, need-aligned opportunity. A chance for credit unions to meet members where they live—literally.

Home Improvement