The £170,000 problem with buying a ‘fixer-upper’ home in the UK
Key Points
- Bringing a fixer-upper to new build standard could cost around £170,000
- 56% of buyers would budget no more than £50,000 for renovations
- New builds save around £420 to £650 a year on energy bills
- 54% of 25- to 34-year-olds could be forced into a renovation project
Upgrading a three-bed semi to new build standards could cost around £170,000, the Home Builders Federation (HBF) has warned.
The HBF published the figure in its Nothing Compares to New report, which surveyed adults on how much they expected to spend renovating an older property.
More than half (56%) of respondents said they would budget no more than £50,000 for a fixer-upper. Almost a third (29%) expected to spend £25,000 or less.
Only 1% of those surveyed expected renovation costs to exceed £150,000.
The £170,000 estimate covers the cost of matching the energy efficiency, comfort and technology found in today’s new build homes.
Virtually all new builds achieve an A or B Energy Performance Certificate (EPC) rating, compared with less than 5% of older homes. The average new home uses around 30% less energy as a result.
Research the HBF carried out with Octopus Energy put the saving at around £420 a year compared with an EPC D-rated older property. The saving rose to around £650 a year against EPC F or G homes, which are more common among renovation projects.
Some 42% of respondents said mortgage affordability limits could force them to buy a property needing significant renovation work. The figure rose to 54% among 25- to 34-year-olds.
The HBF linked the finding to the first-time buyer support scheme the Government announced over the weekend.
“Many buyers believe that renovation projects offer greater long-term value, but our research shows that the reality can be very different,” said Steve Turner, executive director at the HBF.
“Today’s new build homes are designed to include many of the features buyers can spend years and thousands of pounds adding to older properties,” Turner said.
The report forms part of the HBF’s Power to Personalise campaign. It calls for greater transparency around renovation and ownership costs, and for the long-term savings of new build homes to count towards mortgage affordability assessments.
