Why doer-upper homes are falling out of favour with housebuyers
For years, doer-uppers have been seen by buyers as a brilliant way to get more house for their money and make a profit by renovating them.
However, the appeal of the doer-upper is changing, and many people now favour ready-to-move-into homes.
One of the biggest factors behind this shift is rising renovation costs. Labour shortages, higher material prices and wider economic pressures have pushed building costs up significantly over the past few years.
As a result, the savings made on buying a property that needs work are often reduced, or even eliminated, by the cost of renovating it. This has made buyers more cautious, particularly those without experience of managing building work, access to trusted tradespeople or the ability to do work themselves.
There has also been a broader change in buyer expectations. We live in an increasingly fast-paced, instant society where people want everything immediately. The appeal of moving into a done-up home, unpacking and getting on with life has grown considerably, particularly among younger buyers.
Investors, who historically played a key role in the doer-upper market, have also stepped back over recent years as changes to taxes, including higher stamp duty charges on additional properties, have squeezed profit margins. When these additional costs are combined with higher renovation expenses, it becomes more difficult to make a profit.
Financing also plays a role, as mortgages are generally harder to secure on homes that need a lot of work, because lenders are often more cautious than they are when it comes to ready-to-move into homes.
Buyers also need access to large amounts of cash to fund renovation projects, which on top of already substantial deposits, can be prohibitive.
That said, the doer-upper is still attractive to certain groups. For buyers who can purchase at the right price and who have access to trusted tradespeople or are willing to take on some of the work themselves, there are still real advantages.
Renovating a home gives buyers the opportunity to put their own stamp on it and design something that works for them, which is often a major draw.
For homeowners looking to sell a property that needs a lot of work, understanding this shift in buyer sentiment is essential.
Firstly, realistic pricing is crucial. Sellers need to consider the condition of their home, the cost of the improvements required and how it compares to similar properties in the local area, before pricing accordingly.
Presentation also still matters too. Even if a property requires updating, ensuring it is clean, tidy and well-maintained can help buyers see its potential.
Simple improvements such as decluttering, basic repairs and improving kerb appeal can make a big difference to first impressions.
It’s also important to listen to feedback from your estate agent once the property is on the market. If interest is limited and they’re telling you that buyers are raising concerns about the price, decisive action is needed and you should reduce your price.
Properties that remain on the market for too long lose momentum, so making a timely price adjustment is a sensible strategy that is likely to help secure a sale.
For buyers and sellers alike, success increasingly depends on careful planning, realistic price expectations and a clear understanding of the challenges and opportunities that come with taking on a home that requires work.
Mark Manning is managing director of Manning Stainton estate agents