Bought an Outdated Home? Here's How to Prioritize Your Renovations

Think functionality before aesthetics.

It's pretty uncommon to buy a home that's in perfect condition when you move in. Chances are, your home is going to have at least some issues, whether it's ugly carpeting or a fence that's missing panels.

As a new homeowner, you may be eager to tackle all of your renovations as soon as possible. But let's face it -- these projects can be costly, and you might only have enough money to work on them one at a time.

In fact, you may not even have the money at all, leaving you to borrow it instead. And in that case, it's really important that you set priorities with regard to your renovations. Here's an approach you might find helpful.

Priority No. 1: Things that aren't working

Let's say you've moved into your home only to find that your oven doesn't work. That's a problem, as it might seriously impede your ability to cook meals for your family. And so putting in a replacement oven is the sort of thing you may want to do first.

Similarly, let's say your home comes with a deck that doesn't seem structurally sound. That could be a big hazard. So a new deck is the sort of project you'd probably want to put above others.

Priority No. 2: Things that could function better to improve your quality of life

Maybe your washing machine takes forever to clean your clothing. Or maybe your heating system works, but you find that it takes a while for the heat to kick in. These are the sort of projects that could improve your quality of life, so they should get relatively high billing on your list.

Similarly, you may have access to a basement that isn't finished. Putting down flooring and installing lighting could give you added living space, which could clearly make your home life more comfortable. So that, too, is a good project to prioritize.

Priority No. 3: Aesthetic changes

Maybe you think the tiles in your master bathroom are the ugliest pattern you've ever seen. Or maybe you're just not a fan of the kitchen countertops the former owner of your home chose.

These things can be an annoyance. But they won't make it so you can't use your bathroom or prepare food. As such, you may want to put projects like these at the bottom of your list.

How to finance home renovations

Knowing which home projects to embark on first is important. But it's also important to choose the right means of financing a home renovation if you don't have the cash to pay for it outright.

If you're a new homeowner, you may not have enough equity in your property yet to borrow against it. But a personal loan could be a good bet in that scenario.

A personal loan lets you borrow money for any purpose, so you can take one out and use the proceeds to renovate your home. And if your credit score is in great shape, you might manage to snag a pretty affordable interest rate on a personal loan.

As of late 2022, U.S. personal loan balances came to $222 billion, according to TransUnion. So clearly, these loans are a pretty popular choice among consumers. And you may want to consider applying for one if you have a big home project to undertake.