Is it worth buying a fixer-upper property?
The latest research from eXp UK reveals that fixer-upper homes can be picked up for an average saving of more than £44,000, but when the cost of renovating the property is accounted for do homebuyers actually stand to make a saving? And what chance do buyers have of finding one on today’s market?
Fixer-uppers are a great way of getting your dream property, providing the opportunity for buyers to create a house entirely in their own vision, perfectly suiting their tastes and requirements. However, they don’t necessarily offer the savings that you might initially expect.
Is buying a fixer-upper worth it?
eXp UK’s analysis of the average price for a fixer-upper on today’s market reveals that they can typically be snapped up at -12% below the wider average house price*. At the current average asking price of £368,019*, this is equivalent to a discount of -£44,162 and gives an average fixer-upper price of £323,857.
However, according to figures from CheckaTrade the average cost of renovating a typical 3-bed home comes in at £76,690*. As such, the initial saving made on purchasing a fixer-upper can quickly be negated by the level of spend required to turn it into a dream home.
Buyers shouldn’t be entirely put off, though, because they’re still making a huge saving on the initial purchase, and the renovation costs can be spread out over time. Furthermore, all improvements made to the property will add significantly to its value, reducing the overall cost when they come to remortgage and paving the way for a good profit if and when they come to sell.
But, further analysis from eXp UK shows that securing a fixer-upper opportunity could be difficult, as availability is slim.
Where are Britain’s fixer-upper homes?
The latest property listings data for Great Britain shows that fixer-uppers account for just 5.4% of the 377,898 homes currently available for sale across the nation.
Regionally, Wales has the highest proportion of fixer-upper homes, with 8.2% of all listings requiring renovation. The South West follows at 6.8%, with Yorkshire and the Humber (6.5%), the North West (5.7%), and the West Midlands (5.6%) also offering above-average availability.
At the other end of the scale, London has the lowest number of fixer-upper homes, accounting for just 4% of total homes listed for sale.
Head of eXp UK and Europe, Adam Day, commented:
“Fixer-upper homes can present a fantastic opportunity for buyers who are prepared to roll up their sleeves and invest a bit of time and effort into improving a property.
Not only can they offer a more accessible route onto the property ladder due to their lower purchase price, but they also allow buyers to shape a home entirely to their own tastes and requirements, rather than paying a premium for someone else’s finished vision.
That said, it’s important that buyers approach a fixer-upper with their eyes open. Renovation costs can quickly add up, particularly if there are structural issues or larger projects involved, so careful budgeting and planning is essential before taking the plunge.
For those who do their homework and factor these costs in from the outset, a fixer-upper can still represent one of the best ways to unlock both value and potential in today’s property market.
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