Key takeaways:
- Los Angeles, CA, and Chicago, IL, are the best cities for fixer-uppers thanks to a combination of available listings and savings potential.
- Fixer-uppers come with a $283K median price tag, 29% lower than a move-in-ready home. Moreover, in 20 out of the 50 largest cities, fixer-uppers cost 50% less than regular homes.
- Los Angeles, CA, plays in a league of its own, yielding the biggest savings by far for people looking to buy a fixer-upper. There’s a huge $945K difference in asking prices between move-in-ready homes and properties in need of some TLC. Kansas City, MO, and Dallas, TX, rank second and third, each offering a chance at savings of over $200K.
- One in 10 houses is a fixer-upper among the 50 largest U.S. cities
- Detroit, MI, Cleveland, OH, and Philadelphia, PA, are home to the largest shares of fixer-uppers among their local active listings’ inventories.
High home prices, expensive mortgages and an insufficient housing inventory are all hallmarks of the current housing market that often turn home acquisition into bidding wars. With the intensified state-to-state migration activity adding an extra layer of competitiveness, certain places appear virtually inaccessible, especially for first-time homebuyers.
One way to still get a bite of the homeownership pie is to roll up your sleeves and get renovating. Getting a fixer-upper may offer some financial respite for those looking to enter the housing market at a lower price point, as they are typically more affordable upfront compared to move-in-ready homes. Additionally, renovating a fixer-upper can add value to the property over time, potentially increasing its resale value. Of course, the costs of remodeling are paramount here as they can make or break the deal. A home makeover in Wichita, KS, may cost as little as $45K, according to home improvement loan data from Construction Coverage, but you’ll need to budget an average of $255K to restore an abode in San Jose, CA, to its former glory.
All things considered, the potential for financial savings and the chance to customize make purchasing a fixer-upper an attractive route to homeownership. But where can you find a steal with renovation potential? Some cities are faring much better than others in offering alternatives for budget-minded buyers who share Joanna Gaines’s love of home improvement.
To discover the best places to buy a fixer-upper, we turned to our sister division Point2, a full-service real estate search portal. We’ve analyzed more than 70K active listings for homes for sale in 50 of the most populous cities and calculated the difference in asking prices between homes displaying fixer-upper characteristics (e.g., “TLC,” “good bones,” “as-is”) compared to regular listings. We then ranked the cities based on a combined metric that includes the potential savings while factoring in the available stock of fixer-uppers in a specific location — mainly because you may still want to check a few options before selecting the one “unpolished gem” to turn into your forever home.
As it turns out, fixer-upper homes come with a $283K median price tag, 29% lower than a move-in ready home. Buying a fixer-upper as opposed to a turnkey home may result in savings of nearly $117K, on average. Moreover, in 20 out of the 50 largest cities, fixer-uppers are at least 50% cheaper than regular homes.
Combining availability with the potential to save big, Los Angeles, CA is not short of bargain material. It ranks first among the largest urban hubs in offering a favorable turf for home flippers to explore. The price difference between a turnkey home and a fixer upper in LA hits a whopping $945K. That’s more than double the national average for a fixer-upper home.
LA is the best city for fixer-uppers, alongside two other CA cities
Los Angeles, CA, reigns supreme as a renovator’s delight, thanks to a combination of active fixer-upper listings and potential savings resulting from choosing a home in need of repairs compared to a turnkey one. Prospective homebuyers looking for a home that needs some TLC have plenty of options in the City of Angels, with 26% of the for-sale inventory representing fixer-uppers. While turnkey homes come with a price tag of over $1.9M on average, a fixer-upper home calls for a little over $1M. In other words, buying a fixer-upper amounts to a difference of $945K, the largest savings potential among all the cities we analyzed. That said, LA is no cheap place. Remodeling that diamond in the rough you found will cost another $155K on average.
One other thing to consider is space. In line with national trends, fixer-uppers in LA are smaller than regular listings, at about 1,730 square feet. That translates to losing about 660 square feet compared to a turnkey home — about the combined size of a living room and a small kitchen. But that’s where self storage can do loads of good. Besides helping buyers keep things away from home during the renovation process, it can also assist with making the most of smaller spaces. Belongings that don’t see everyday use can easily stay in a storage unit without cluttering the living space. Renting a storage unit in Los Angeles comes down to $245/month.
Still in the LA area, Long Beach, CA, is also emerging as a vibrant fixer-upper hot spot. About 20% of homes listed for sale are fixer-uppers, so you’ll have plenty of options to choose from as you chase homeownership at a discount. With a median price of $837K, buying a home that carries a fixer label can bring you savings to the tune of $134.5K, one of the highest in our ranking. Thanks to a diverse housing stock that runs the gamut from craftsman bungalow and Spanish Revival to mid-century modern, you’re likely to find a fixer in an architectural style to your liking. For the time you’ll spend renovating your fixer-upper, you can turn to self storage to help you better manage the project. A storage unit in Long Beach rents for $193/month on average.
A little north, Fresno, CA, also comes up on the radar as a great place for fixer-upper potential. Unlike many housing markets in California, Fresno positions itself as an affordability haven. A regular home lists for $452K, but going for a home with good bones can be a true bargain, as it asks roughly for $303K. This amounts to savings of about $149K. Remodeling costs are sitting at approximately $85K on average — it’s clear that taking the fixer home path is worth it financially.
The Midwest is home to plenty of fixer-upper gems with Chicago, IL, taking center stage
Chicago, IL, lands second nationally for fixer-upper homes. Chicago is one of the hottest real estate markets in the country, with home prices estimated to continue their climb in 2024. Turning to a home in need of repairs might indeed pave the way to homeownership for first-time buyers in the Windy City, as approximately 19% of local listings qualify as fixer-uppers with potential savings that hit $190K on average. While a regular home lists for $424K, you’d pay about $235K for a fixer home. Home improvement loans range around $75K in Chicagoland, lower than most other urban hubs including those in California, Texas, Florida and New York.
Another Midwest location, Minneapolis, MN, is shaping up to be a prime destination for fixer-uppers, boasting a sizeable share of bargain homes representing 20% of active listings. That’s no surprise given Minneapolis is one of the best cities to find historic homes, giving buyers a wide pool of abodes with historic charm to choose from. Regular homes are already moderately priced here — at about $330K, but a fixer home is even cheaper, averaging $204K. That leaves you with a potential savings of $125K. The investment is all the more worthwhile here, as it takes about $65K to remodel a property in the Twin Cities, based on home improvement loan data.
Also hailing from the Midwest, Kansas City, MO, joins in the fixer-upper frenzy. About 13% of the listings are fixer homes locally. Zooming in on asking prices, a regular home is listed at $400K, while a fixer home calls for $170K. That would save you $229K on average, the second-highest savings resulting from buying a home with a fixer label. Given that remodeling loans in the Kansas City metro area average $65K, they could comfortably cover repairing your new home while enhancing property values.
Chock full of historic charm, Southern cities are prime for fixer-upper potential
As one of the most popular relocation destinations in Texas, Dallas, TX, is also experiencing the ripples of a more competitive housing market. With a regular home listed at $500K, bargain homes naturally seem the more appealing choice, averaging $283K. Opting for a home with good bones could, in fact, lead to significant savings — roughly $217K on average. Even after factoring in remodeling costs, which average around $105K for a home improvement loan, the financial benefits remain considerable.
About 12% of active listings in Dallas are TLC homes, giving you plenty of options if you’re looking for a gem to polish. Although fixer-uppers are smaller than a turnkey home in Dallas — 1,400 square feet versus 2,014 square feet — they’re generally sitting on bigger lots. You get close to 8,000 square feet in your fixer backyard, an additional 360 square feet of yard space compared to the lot size of a standard home. Further helping with maximizing space at home, self storage is on the cheaper side in Dallas with a storage unit renting for $73/month on average.
In another Southern gem, Louisville, KY, roughly 13% of the current listings inventory features fixer homes, giving plenty of choice to those willing to put in some elbow grease. While regular homes already boast an affordable average price of $320K, those in need of repairs come even cheaper at $185K. Considering the substantial $135K in savings from purchasing a fixer home and the average cost of remodeling in the Louisville metro area at $65K, it’s certainly worth considering this investment for the chance to transform it into a personalized dream home.
Baltimore, MD, and Philadelphia, PA, are East Coast’s fixer star cities
Located on the East Coast, Baltimore, MD, boasts a diverse architectural history, priming it to be a treasure trove for diamond-in-the-rough homes. About 26% of the homes listed for sale are hinting at remodeling potential. They also come with an attractive price tag of $135K, shaving about $102K off the price of a typical listing. That makes a fixer-upper 43% cheaper than a move-in-ready home in Baltimore.
Famous for its townhouse building tradition, Philadelphia, PA, combines availability of fixer-uppers with affordable prices. The City of Brotherly Love has one of the highest inventories of homes needing some work, representing 28% of all listings. Regular homes already come with an attractive price tag here compared to other urban hubs — at $278K — but going for a fixer home can bring that price down even more. In fact, you’d be saving $96K when snagging a property carrying a fixer-upper label. With the median cost of renovating a fixer in the Philly metro area standing at around S75K, it’s worth it for buyers to take this route compared to buying a regular home.
Western cities score lowest for fixer-upper potential
At the other end of the spectrum, Henderson, NV, is the least likely place to attract fans of makeover projects. Homes in need of repairs are scarce, with only 3% of local inventory representing fixer-uppers. Similarly, Arizona’s Mesa also has a low supply of fixer homes (3%), followed by Sacramento, CA, where homes in need of TLC make up 4% of the listed inventory. Tucson and Phoenix are also Arizona places where finding a fixer-upper is more challenging, with both cities registering low supplies of homes in need of renovation.
Outside of the Southwest, some Texas cities are also places where finding a fixer-upper might turn into a treasure hunt. One of the reasons might be the intense real estate activity in the past decade that revitalized and renewed the housing stock across the state. Houston, in particular, which emerged as the most active real estate market of the decade, also shone in the residential department. Space City came first for single-family home construction, with no fewer than 55,600 building permits issued between 2013 and 2022. It may come as no surprise, then, to see Houston having the lowest inventory of fixer-upper homes, currently at 1% of active listings.
Where can you save the most when buying a fixer-upper?
Fixer-uppers have the upper hand in terms of affordability across most of the 50 largest U.S. cities. Nationally, you get the heftiest cash savings resulting from picking a fixer-upper over a move-in-ready home in Los Angeles, to the tune of $945K, about seven times more than the national average savings in our study.
Outside of California, you can access sizeable savings when buying a fixer-upper that can make a difference in your home-buying budget. For instance, looking at Kansas City, MO, or Dallas, TX, you get to save over $200K in both cities when going for a home that needs some TLC. That brings the cost to an attractive $170K in Kansas City and $283K in Dallas. Moreover, in Chicago, you can save about $190K when going for a fixer home, whereas going for a home in need of TLC in Bakersfield, CA, and Corpus Christi, TX, can save you over $160K in both cities.
Interestingly, fixer-uppers may come with higher price tags than regular homes in some places. As with everything else in real estate, it often boils down to location, which is what drives prices up, especially since many fixer properties are historic gems located in highly coveted neighborhoods. This may also reflect the generous living space they offer compared to newer properties, which tend to be on the smaller side. That’s the case in Austin, TX, where fixer homes cost almost $260K more than regular homes. Most fixers for sale in Austin are located in some of the best neighborhoods in the city, such as Zilker and Bouldin Creek. South Austin and Johnston Terrace are also desirable neighborhoods that buyers tend to favor over other, often more affordable locations, even if that means putting in some sweat to make the home their own.
In San Jose, CA, fixer-upper prices surpass those of turnkey homes by approximately $181K. This might be due to their larger home sizes or their location in sought-after neighborhoods like West San Jose, Dorsa Miller or Overfelt High. Likewise, in San Diego, fixer-uppers also command a higher price tag than move-in-ready homes. On average, the price difference amounts to $35K and is largely influenced by homes in Point Loma Heights, Sunset Cliffs and Ocean Cliffs.
Fixer-upper homebuyers get a renovation head start and more propped up by self storage
Buying a home is complicated enough, requiring plenty of planning and more, but going for a fixer-upper brings in a slew of new challenges. Since these types of homes are not ready to move in, renovations are typically in order, and dealing with your belongings is something that you need to tackle. Self storage comes in particularly handy at this point, as you can easily keep furniture, clothes and other possessions in a storage unit until work is complete.
Moreover, most fixer-uppers offer a smaller living space. Our findings show that in most cities included in the research, fixer-uppers are smaller than turnkey homes. While a turnkey averages 1,860 square feet, a fixer-upper offers about 1,550 square feet of living. The difference amounts to about 300 square feet, about the size of a typical one-car garage. In this context, fixer homeowners can also find self storage useful, providing additional space away from home for belongings that don’t see everyday use, such as seasonal decorations, clothing and outdoor gear.
Rates for self storage units can vary vastly based on location. In California cities such as Los Angeles ($245/month), Long Beach ($198/month) and San Diego ($183/month), rates are higher. In other places of the country, you might find more convenient rates, whether you’re renting a storage unit in Oklahoma City, OK ($85/month), Memphis, TN ($92/month), or Omaha, NE ($94/month).
Frequently asked questions about fixer-uppers
What is a fixer-upper?
A fixer-upper is a home that’s typically older and in need of repairs. Therefore, it usually costs less than a regular home. Renovations required can range from cosmetic changes to structural repairs to make it ready to move in. Buyers can tackle simple repairs such as painting, but when it comes to structural issues such as plumbing, roofing or foundation, professional contracting services are required. Often, renovating a fixer-upper might mean you need to go over budget, as unforeseen repairs might come up. Planning for additional expenses is the way to go when you first start the remodeling process.
If you’re wondering whether you should buy a fixer-upper, you should know that it might require significant financial and time investment. But it’s one sure way to build home equity, not to mention you may end up enjoying the home of your dreams.
How can I find a fixer-upper home?
One of the first steps you can take when looking for a fixer-upper is to consult a listing site to find homes for sale. If the site already has a fixer-upper filter, use that feature to identify a potential home you’d like to visit. Alternatively, if this feature is missing, you can filter home listings by the construction year to discover homes with fixer potential, as homes in need of repairs tend to be older. More specifically, look for homes built before 1980, which are considered to come from an older housing stock and may well fall within the fixer-upper category.
Of course, location is key when it comes to all real estate decisions, and this holds true for homes with good bones as well. Whether you’re planning on using this home as your new residence or flipping it, you’ll want to look for fixers in good neighborhoods close to amenities, as it will add to the property’s value.
If you’re contemplating buying a fixer-upper close to your current location, you could also drive around in historic neighborhoods and look for signs for homes for sale. Curb appeal might be an indicator of what you can find inside, but you’ll naturally have to check with your real estate agent about the actual state of the house.
How much does it cost to renovate a fixer-upper?
It can cost about $85K to tune up a standard house, based on remodeling loan data from Construction Value. Naturally, rates can differ based on location. California’s metro areas are not only places where the price of real estate is high, but so is the cost of remodeling — five places in the Golden State are among the top 10 for the highest home improvement loans. San Jose takes first place, with a home improvement loan averaging $255K, followed by San Francisco ($205K). In the Los Angeles metro area, it costs, on average, $155K to bring a home up to snuff, based on the value of home improvement loans.
Southern places such as the Austin ($125K) and Miami ($105K) metro areas also see higher price tags associated with home renovations. Similarly, it also takes $105K to tune up an abode in the Washington, D.C., and New York City metro areas on the East Coast.
Besides location, rates can also vary based on the nature of the project. For Ben Gold, founder of Recommended Home Buyers, the total cost of fixing his property amounted to approximately $60K, with the most expensive parts being the kitchen, bathroom and foundation repairs. Robert Taylor, owner of The Real Estate Solutions Guy, sees a remodeling project costing anywhere between $60K and $80K, but he points out it could cost even more. “Heavy fixer-uppers typically are $100,000 and up,” he said. Additional damage calls for increasing the repair budget. “The home had $25,000 in dry rot, termite damage, and siding that needed to be corrected. In some areas, this meant removing the subfloor and siding in order to replace the floor joists and subfloor,” he added about the home he remodeled.
What are the financing options for rehabbing an older home?
You can turn to fixer-upper loans to finance your renovation project, with several options available. You can consider fixer-upper-dedicated mortgages such as an FHA 203(k) loan, a VA renovation loan or a conventional rehab loan. Besides government home renovation loans, you can access conventional loans that cover the cost of repairing your home in the mortgage amount. Fannie Mae HomeStyle Renovation and Freddie Mac CHOICERenovation are two types of conventional loans that can support you with financial needs when buying a fixer-upper, but you’ll need to find a lender that offers these types of loans.
Some loans include the costs of the upgrades as well as your monthly mortgage payment. They’re a great choice for fixer-upper buyers as there’s less competition for this type of loan because fewer people buy these kinds of homes. Moreover, when the renovations are done, you can gain access to home equity. On the flip side, it can be complicated to get approval, and some loans only partially cover the cost of repairs. It would help if you also planned for extra expenses, as you might take on a more complicated project than anticipated.
Do I need a home inspection when buying a fixer-upper?
Once you have found your ideal fixer-upper, you should consider a home inspection to assess the home for all repairs and upgrades necessary. A professional will assess the property for any hidden issues that qualify the home for further repairs, such as water leaks or structural problems. They can also check for pest-related infestations and the presence of lead paint and mold. Should any of these issues be present, you can use the inspection contingency to involve the seller in remedying these issues. Besides the home inspector, bringing a contractor could also help to reveal any issues the home inspector might have missed.
Once you’re aware of the home’s issues, you’ll be able to come up with a realistic budget for the project. This will help you decide whether buying the home is a project you’ll want to undertake.
How much should I budget for unforeseen expenses when rehabbing a fixer-upper?
It would help to establish a budget and to try to stick to it, but investing in a fixer-upper can also be a leap into the unknown. That might mean unforeseen expenses as the project progresses. Add a contingency budget to the tune of 20% of the cost of the project for these types of expenses, as you might discover additional issues that need to be corrected.
Robert Taylor, owner of The Real Estate Solutions Guy, has firsthand experience with contingency budgeting. “For example, if we expect the repairs to be $40,000, we’ll typically add $6,000 to $8,000 into the budget for contingencies. We once bought a home with a new roof, and so we didn’t account for a new roof in our budget. After the purchase, we discovered that there was asbestos fireproofing under the roofing that was deteriorated and a health risk.” As the project continued, new challenges came up. “We soon realized that not only did we need to bring in a special hazardous materials company to remove the asbestos, but in order to do that, we had to remove the brand-new roof. ” He also added that “having a very healthy contingency fund kept our project from being a financial nightmare.”
Fixer-uppers can be an attractive alternative to the typical move-in-ready home, especially in competitive markets where many prospective homebuyers are priced out. When contemplating buying a fixer-upper, pricing and availability can point homebuyers in the right direction. Some of the biggest cities that are also historic combine fixer-upper availability with enticing savings when buying a home that needs some restoration compared to a turnkey home.
Methodology
This analysis was done by StorageCafe, an online platform that provides storage unit listings across the nation.
To help us determine the final ranking of the best cities for fixer-uppers, we’ve used data from Point2, our sister division and real estate listing platform. We’ve considered “for sale” listings in the 50 most populous U.S. cities (above 300K residents) on February 27, 2024. Listings include single family homes, townhouses, duplexes and triplexes.
To identify these properties, we used keywords such as “TLC”, “good bones”, “as-is”, “in need of repairs” and others that acted as filters. The final ranking consisted of a weighted average that considered fixer-upper inventory (50%) and cash savings (50%) resulting from buying a fixer-upper home compared to a regular home. We’ve excluded cities that had fewer than 100 listed homes from the final ranking.
We’ve also included metrics such as home sizes, lot sizes and construction year for fixer-upper and regular homes in cities with a minimum of 100 listed properties.
Self storage was also used as an additional metric – the service is typically used during remodeling projects, providing a temporary home to household items and construction materials for the duration of the project.
Data on self storage, home and lot sizes comes from Yardi Matrix, StorageCafe’s sister division and a business development and asset management tool for brokers, sponsors, banks and equity sources underwriting investments in the multifamily, office, industrial and self storage sectors.
Data referring to the cost of renovating a home came to us as a courtesy from Construction Coverage and it reflects the value of the median home renovation loan per metro area in 2023.
