Changing Home Buyer Trends Show that Fixer-Uppers Are NOT As Popular
Fixer-uppers have been popular with investors looking to flip houses. They would buy homes at a discount, put some work into them, and then resell them at a hefty profit. This flip trend soared in the early portion of the pandemic. However, with home prices falling from their peaks, many investors are now slowing down their purchases. If prices dip, even a little, they could lose money on their projects. Many of the larger flip investment firms such as iBuyers have either exited the market or aren’t buying as much at the moment. An iBuyer would pay for your house in minutes with no obligation with a fast and convenient closing. There is less demand for these fixer upper properties now.
Now, houses are staying on the market longer and sellers are dropping the price on these homes or accepting lowball offers.
“Buyers want those homes [only] when there is no other inventory out there,”
Matt Curtis
Even in today’s more challenging housing market, “anything that is staying on the market for more than 48 hours [without a booked showing] is in a less desirable location and definitely not in tiptop, showable condition“, says real estate agent Debbie Lang. She works for Berkshire Hathaway HomeServices Fox & Roach Realtors. She recently saw a home priced below $1 million that received eight offers. What’s not selling are properties “that need a major renovation and updates, like a new kitchen or bathroom and major systems,” says Lang. “Buyers are always looking for improvements that have already been done.” Those problems can be overlooked if the home is in a great location, such as near a train station or in a community with top-rated schools, she says. But buyers could get a discount on these properties.
Money isn’t the only obstacle to purchasing a home that needs some TLC.
In southeastern Connecticut, a popular vacation destination, it can be difficult to get work done in a timely manner. As demand for skilled craftsmen remains high; finding one who can accommodate your schedule is a huge challenge.
Furthermore, many localities along the shore do not allow construction activity during the summer, pushing your project completion time out even further.
“Because of the supply chain issues, it’s often difficult to get materials. There’s also a shortage of workers,” says Payson. Meanwhile, “properties that you don’t have to do anything to are seeing, like, 12 offers.”