A New Report Identifies the Best U.S. Cities to Buy a Fixer-Upper
In 2021, many would-be homebuyers found themselves in a dilemma caused by increasing home prices and dwindling inventory. In order to combat this problem, many prospective buyers are considering fixer-uppers as a more budget-conscious way to fulfill their desire for home ownership.
According to StorageCafe, buying a fixer-upper in the 50 largest cities in the U.S. is 32% less expensive than buying a traditional turn-key property. In dollars and cents, this equates to an average of $155,000 in savings to the buyer. However, in 12 of those cities, the prices for fixer-uppers are still inaccessible for many homebuyers with price tags over $500,000.
Making a Fixer-Upper Move-In Ready Takes Work
Buying a fixer-upper not only requires the willingness to take on certain risks, but the patience to put in the time and effort to make the home livable. However, just as seeking a traditional move-in ready home requires research, finding the right fixer-upper for your particular needs and situation will also take considerable preliminary analysis.
Although a fixer-upper may be the remedy for soaring home prices, they come with their own costs. Not only will the home have its own price tag and the general costs associated with homeownership such as insurance and property taxes, but renovations also come with their own expenses. The homebuyer must think about materials, labor, permits, and contingencies.
In addition to the tangible costs, the time investment involved in restoring or upgrading a home can be just as consuming as the financial investment. For example, upon inspection, the property may have major issues (i.e.. plumbing) that will delay its completion and necessitate greater outlays than the buyer initially planned.
However, these factors should not completely deter you from buying a fixer-upper, and in fact, it may be best to make a quick (but educated) decision due to the unpredictability of the market.
The Price of Fixer-Uppers by City
What can you expect to pay for a fixer-upper? Well, that depends on where you choose to buy.
According to StorageCafe, Milwaukee is the top city in the U.S. to buy a fixer-upper based on price, inventory, and the average size of the homes. Philadelphia, Detroit, Memphis, and Baltimore City round out the top five. Based simply on price, however, Detroit takes first place with the average fixer-upper carrying a very modest price tag of around $60,000.
Amongst the cities with the most expensive fixer-uppers, California takes the lead. In San Jose, the average home costs just shy of $1.3 million. In fact, California boasts five of the top 10 entries for the costliest markets. Other cities include Boston ($899,000), New York City ($760,000), and Mesa, Arizona completes the list at $599,900.
Though home prices on the most expensive list may be out-of-reach for many buyers, many of those homes also offer more savings than the ones on the least expensive list. Los Angeles, number three on the most expensive list, is number one in terms of the money buyers can save by purchasing a fixer-upper ($500,000).
For first-time homebuyers trying to navigate an ever-changing real estate market, a fixer-upper may be worth considering as a more cost-effective entrance into home ownership.
The content provided on this website is deemed accurate at the time of creation.