The appetite for properties requiring significant renovation has declined sharply, with only 6% of buyers actively seeking such projects, according to research from property group LRG.
A survey of more than 700 buyers and sellers conducted between April and June found that 53% would not take on major renovation work at all, marking a shift in buyer preferences towards move-in ready properties.
Pricing concerns
The research indicates that 41% of buyers would still consider a renovation project, but only where the asking price reflects the cost of work required. Data from Octane Capital, cited by LRG, shows that renovating a typical property requiring work could cost £85,000 or more.
First-time buyers, historically among the most active purchasers of properties needing work, have shown the most notable change in behaviour. Only 5% said they would actively seek a renovation project, while 43% would only consider one if priced accordingly.
Mark Manning, Managing Director of Manning Stainton, part of LRG, said: “Buyers haven’t fallen out of love with homes that need work. They’ve fallen out of love with paying twice, once at the asking price and again at the builder’s merchant.”
Market implications
Manning noted that with increased housing stock levels, properties requiring work only sell when pricing genuinely accounts for renovation costs. “Sellers who accept that from day one do well. Those who price for the finished house, rather than the one they’re actually selling, watch interest dry up within a fortnight,” he said.
The findings suggest sellers of renovation properties may need to adjust pricing strategies to reflect current market conditions. With buyers increasingly risk-averse and seeking certainty, the premium traditionally attached to properties with potential may need recalibration. The shift could also impact investors who have previously targeted below-market property deals requiring refurbishment, as competition for such assets may decrease.
For property professionals, the data points to a market where transparency around renovation costs and realistic pricing will be critical factors in achieving sales of properties requiring work.
