First-time buyers are choosing fixer-uppers to step on to the property ladder for less, new research shows.
Two in three of those buying a starter home have purchased a cheaper property because it offers a renovation opportunity, according to Nationwide Building Society.
And swathes of first-time buyers are choosing to buy a fixer-upper instead of compromising on location.
Some two in five of those who bought a home in need of work did so because it meant they could afford a home in the area that they wanted, instead of shelling out the same amount for a polished home in a less desirable place.
Almost one in three bought a project property to shape it to their own tastes, while one in four did so to increase the value of the home.
Graft: Matt and his partner of four years, Jess, working on the garden of their fixer upper
Buyers have been swayed into opting for polished ‘turnkey’ properties in recent years as the cost of renovation work has spiralled out of control as inflation has ticked upwards.
But the fresh figures from the mutual, which polled 2,000 people, reveal that first-time buyers are opting to do work themselves where possible to save money.
Even those who haven’t bought an outdated home have completed some renovation work – some 93 per cent of those buying a starter home have completed at least one project and 34 per cent have carried out many DIY tasks.
Painting and decorating is the most popular task, as buyers strip away outdated wallpaper. Next is bathroom and kitchen improvements followed closely by better flooring.
Repairs and maintenance on things like door handles and guttering is also vital to many first-time homeowners.
Carlo Pileggi, head of mortgages at the mutual, says: ‘For many first-time buyers, opting for a cheaper property that needs work is a deliberate and savvy choice rather than a compromise.
‘By taking on a home requiring renovation, they are not only able to get onto the property ladder in the location they want, but they can shape it to their own taste while adding to its value.’
I fixed up my first home… now I’m doing it again!
Matt Barker, who works in marketing at Nationwide, did exactly that when he bought his first house in 2023.
The 28-year-old had saved up for around three years to put down a five per cent deposit on a £185,000 two-bedroom terrace in an affluent area of Chester, where he went to university.
It wasn’t a complete wreck, Matt says, but the home was definitely a fixer-upper.
‘As I was a solo buyer, it was the price of the house that drew me in. I wouldn’t have been able to afford to buy in the area without fixing it up – I imagine I would have had to pay as much as £45,000 more,’ he says.
‘It had probably been done up around 15 to 30 years ago and it had been a rental property all of that time.
‘I started modernising it a room at a time in the evenings and at weekends. It took me around two years to do.’
Matt upgraded the kitchen in his first home from a tired 20-year old unit to this modern grey
Hard at work: Matt is seen here digging up his new property’s garden
Matt wasn’t a complete DIY newbie. He started helping out his father on building sites aged just 16, so he put some of his skills to use on his home.
‘Doing this project I’ve learnt how to lay a patio and also plumbing skills,’ he added.
He has put in a new kitchen and bathroom, and plastered and re-painted the walls. He finished by updating the front drive and garden.
Matt has taken the decision to sell his house soon, so he can move in with his partner of four years, Jess, in August. Jess, 26, has just bought a four-bedroom property, also in Chester.
‘It’s an even bigger project doing a rear and side extension. We’ll be living in a building site but the value for money on this property is amazing.
‘Doing up your first home can give you funny memories, too. At one point I was tiling the bathroom while Jess was having a bath!’
Matt’s renovation has added serious value to his first home. It’s just been valued at £240,000, making for a £55,000 gain.
But anyone undertaking such a project needs to be aware of the cost, too.
Pileggi adds: ‘Although there’s a real enthusiasm amongst first-time buyers to roll up their sleeves, our research suggests many have had to undertake more work than they initially intended.’
Three in four buyers completed more work than they initially thought, as hidden structural issues appeared.
Budgets set aside for renovation can spiral out of control if a buyer isn’t fully aware of the work that needs to be done.
Nationwide says a chunk of for young buyers are keeping a slice of the deposit they saved aside for renovation work and instead borrowing more from a lender to cover the cost of the house.
However, beware that this will increase your monthly mortgage payments and it means you will pay more in interest over the course of your mortgage.