Fixer-Uppers Could be the Key to Affordable Home Buying

April 30, 2024 - 3 min read

A potential key to homeownership

As affordability inhibits many house hunters, opting for a fixer-upper could offer an attainable path to homeownership.

A report from StorageCafe found that these types of properties can go for hundreds of thousands less than move-in ready homes in the same cities.

If renovations don’t scare you, check out which popular housing markets provide the largest savings from turnkey price points.

Check your home buying options. Start here

Embracing the fixer-upper

High home prices, interest rates and competition all paint the picture of low affordability in the housing market.

However, those willing to tap into their HGTV dreams may have a cheaper option in home buying: the fixer-upper. Because they require work and time, they typically come with lower listing prices compared to move-in ready homes. Even after accounting for renovation costs — which vary by location, similar to real estate values — these properties can end up saving borrowers thousands.

“Buying a fixer-upper remains a viable option for many cash-strapped buyers looking to secure a property in a prime location,” said Mirela Mohan, real estate editor at Yardi. “In Los Angeles, where real estate prices reach for the stars, turning to a fixer-upper is often the most feasible path to homeownership for first-time buyers.”

The City of Angels displayed the greatest potential savings, with a $945,000 difference in median prices from a turnkey property to a fixer-upper. Kansas City, Mo., was next with a potential savings of $229,900, followed by Dallas at $217,000.

For its report, StorageCafe analyzed over 70,000 active for-sale listings in the most populous U.S. housing markets. It found that fixer-uppers had a median price of $283,000 versus $399,900 for turnkey homes, good for a difference of $103,478.

Below is the full list of the report’s 51 cities, ordered by potential money savings between a fixer-upper and a turnkey house. The asking price and listing share data were captured on Feb. 27, 2024, and include single family homes, townhouses, duplexes and triplexes.

RankCityShare of Fixer-Upper ListingsTurnkey Median Asking PriceFixer-Upper Median Asking PricePotential Savings2023 Median Home Improvement Loan Size
1Los Angeles26%$1,995,000$1,050,000$945,000$155,000
2Kansas City, Mo.13%$399,900$170,000$229,900$65,000
5Bakersfield, Calif.7%$436,500$274,500$162,001$75,000
6Corpus Christi, Texas10%$324,700$164,000$160,700$75,000
7Tulsa, Okla.12%$325,000$172,450$152,550$65,000
8Fresno, Calif.13%$452,050$303,500$148,550$85,000
9Omaha, Neb.7%$358,000$210,000$148,000$55,000
10Colorado Springs, Colo.6%$575,000$438,500$136,500$55,000
11Louisville, Ky.13%$319,950$185,000$134,950$65,000
12Raleigh, N.C.9%$532,998$398,250$134,748$85,000
13Long Beach, Calif.20%$972,000$837,499$134,501$155,000
14Las Vegas6%$529,839$400,000$129,839$85,000
16Albuquerque, N.M.7%$399,000$275,000$124,000$55,000
17Oklahoma City13%$292,990$178,200$114,790$55,000
18Columbus, Ohio12%$279,450$164,900$114,550$75,000
19Aurora, Colo.2%$624,970$513,990$110,980$105,000
20Jacksonville, Fla.10%$349,993$239,450$110,543$85,000
24Orlando, Fla.7%$489,900$386,000$103,900$85,000
26Memphis, Tenn.15%$229,900$128,900$101,000$45,000
28El Paso, Texas5%$299,899$200,000$99,899$55,000
30Lexington, Ky.14%$395,000$299,500$95,500$65,000
31Wichita, Kan.11%$300,000$205,000$95,000$45,000
32Oakland, Calif.25%$799,000$704,500$94,500$205,000
34Riverside, Calif.14%$717,450$625,000$92,450$105,000
35San Antonio6%$325,000$235,000$90,000$75,000
37Fort Worth, Texas6%$365,006$278,000$87,006$105,000
38Tampa, Fla.10%$505,000$425,000$80,000$85,000
39Washington, D.C.26%$849,900$775,000$74,900$105,000
40Virginia Beach, Va.8%$490,000$425,000$65,000$65,000
42Charlotte, N.C.7%$435,000$384,950$50,050$85,000
43New Orleans11%$387,500$339,500$48,000$105,000
45Arlington, Texas12%$376,000$334,000$42,000$105,000
48San Diego11%$899,000$934,000−$35,000$125,000
49New York City13%$630,000$789,900−$159,900$105,000
50San Jose, Calif.14%$1,394,375$1,575,000−$180,625$255,000
51Austin, Texas8%$589,900$849,000−$259,100$125,000

Of the top 51 most populous cities, four actually had higher median fixer-upper prices. Austin, Texas, had the highest discrepancy at $259,100. San Jose, Calif., New York and San Diego rounded out the quartet with differences of $180,625, $159,900, and $35,000, respectively.

While this seems counterintuitive, a few factors tip the scales. Those higher prices can be attributed to the fixer-uppers having highly desirable locations or more space compared to newer developments in

Financing a home renovation or rehabilitation

In today’s housing market, borrowers have a cabinet of grants and lending products to meet their renovation needs.

Even better, there are six mortgage types specifically for fixer-uppers. These loans cover both the home’s purchase price and the cost of rehabilitation. These include Fannie Mae’s Homestyle Renovation, Freddie Mac’s CHOICERenovation and CHOICEReno eXPress, the FHA’s 203(k), the VA’s renovation loan, and the USDA’s renovation loan.

Like any loan product, they all have different eligibility requirements to meet in order to qualify. A mortgage professional can answer questions, weigh your options and help choose the right mortgage for you.

Check your home buying eligibility here

The bottom line: Buying a fixer-upper

If you’re a house hunter who’s not afraid of sweat equity, buying a fixer-upper could be your ticket to homeownership.

Doing so could lead to big savings, even in some of the nation’s largest and most popular housing markets. Plus, adding the right features could help your investment. Just make sure you know what to look for and avoid when shopping so you don’t buy a money pit.

If you’re ready to start, reach out to a local lender today.

Time to make a move? Let us find the right mortgage for you

Paul Centopani
Authored By: Paul Centopani
The Mortgage Reports Editor
Paul Centopani is a writer and editor who started covering the lending and housing markets in 2018. Previous to joining The Mortgage Reports, he was a reporter for National Mortgage News. Paul grew up in Connecticut, graduated from Binghamton University and now lives in Chicago after a decade in New York and the D.C. area.
Aleksandra Kadzielawski
Reviewed By: Aleksandra Kadzielawski
The Mortgage Reports Editor
Aleksandra is the Senior Editor at The Mortgage Reports, where she brings 10 years of experience in mortgage and real estate to help consumers discover the right path to homeownership. Aleksandra received a bachelor’s degree from DePaul University. She is also a licensed real estate agent and a member of the National Association of Realtors (NAR).