More people are taking out loans to improve their homes

The study, carried out by Sainsbury’s Finance, found that one fifth of personal loans taken out in the last six months were solely for the purpose of funding home improvements.

It appears that the economy’s struggling financial situation has not had much of an effect on the public’s spending as the researchers also found that, between 2007 and 2009, there was a 47 per cent increase in this type of loan.

Sainsbury’s Finance revealed that £3.2m was taken out on personal loans during 2009, and if the current trend continues then this figure will be similar by the end of this year too.

However, it is thought that many people are choosing to take out loans for improving their current living situation instead of moving house, which is often a much more expensive option.

Steven Baillie, Head of Loans at Sainsbury’s, advised, ‘If people do decide that they need a loan to pay for their home improvements, they should make sure they look around for the best rates on the market.’

By Lauren King