Buying a house can be the biggest purchase a person ever makes—but choosing the right type of house can make it a little easier on the wallet.
Buying a house (and, eventually, selling a house) is no small accomplishment. For most people, saving up for a down payment on a house is a years-long financial goal. Saving that huge chunk of money isn’t always enough, though—rising home prices and a limited supply of homes priced and sized for first-time homebuyers are making it more and more difficult for aspiring home buyers (and even people who have already bought and sold a house or two) to find the modest home of their dreams.
According to a new survey from real estate site Realtor.com, almost 60 percent of people hoping to buy a home this spring are considering buying a less expensive home that may need some renovating, essentially sacrificing a few items on their home wish lists in order to buy a home.
For the survey, Realtor.com asked more than 1,000 people planning to purchase a home in the next year about their home-buying plans and whether they’d consider a home in need of renovation.
People may choose to buy a home in need of renovation because homes in their price range may be in short supply in the area, or homes with everything these home shoppers want may be too pricy. Regardless of the reason, the majority of people are considering homes in need of some work—and more than half of them are willing to spend more than $20,000 on the renovation.
Home remodeling costs aren’t cheap, but $20,000 can get any new home owner some decent smaller updates. Larger upgrades—including a total kitchen or bathroom overhaul—will cost much more.
Even with the costs, almost all home shoppers—95 percent of survey respondents—hope to get a positive return on their investment and expect their newly purchased homes to be worth more after their renovations than it was when they bought it. Most home improvement projects will increase the value of a home, but it’s never a guarantee. Picking the right improvements can help people get the most bang for their buck, while the wrong ones could even lower the value of the home.
Deciding whether it’s worth it to buy a more affordable home in need of some improvements should be one of the first steps to buying a home people take, especially because it can help guide the whole home shopping process. Lowering expectations can make the dream of buying a home more realistic, especially for first-time buyers, and most people recognize that, according to this survey—though whether people are actually willing to settle when it comes time to buy remains to be seen.