New research by Confused.com reveals that 35% of homeowners who bought a property that needed renovation had to as it was the only way that could afford to buy a home.
However, 8% of homeowners who bought a property in need of renovation said they couldn’t afford to do the necessary work to it.
And for 10% of renovation homeowners, they had to live “on site”, residing in an unfinished property for more than a year before they started doing any work on it.
Yet, 19% homeowners say the market value of their renovation properties now exceed the combined costs of buying and renovating it, giving them a profit of between £25,000 – £50,000.
On average, homeowners who have bought a renovation property have saved themselves £44,037 by tapping into this new property buying trend. Home renovators are paying on average £152,792 for a property that needed some work done to it, compared to the average UK house price which is valued at £196, 8292.
The research found that on average, homeowners have spent £33,089 splashing the cash on doing up their properties.
12% of homeowners have spent more than £50,000 renovating their home, with the most common things needing renovation including:
- The kitchen – 62%
- The carpets – 61%
- The bathroom – 61%
- Cosmetic decoration – 60%
Deciding to renovate a property is a big decision – and often more expensive than first anticipated – with more than two fifths (45%) of homeowners saying they spent more than intended. In fact, homeowners who renovated their property spent on average a significant £2,886 over their budget. And surprisingly, over a quarter (26%) ended up going over budget by more than £5,000.
Perhaps unsurprisingly, 22% of these home renovators would never buy a renovation project again.
Confused.com also found that 41% of homeowners who have carried out renovation work on their property have not let their insurer know.
Gareth Lane, head of home insurance at Confused.com, said: “As house prices seem to be continuing to rise, it would appear that more and more people are resorting to buying properties that need renovation.
“Deciding to renovate a property is a big decision – and often more expensive than first anticipated. So it’s no surprise that nearly one in 10 (8%) homeowners couldn’t afford to do the renovation work to their property.
“However, of those that could afford make home improvements it’s worrying to note that so many haven’t let their insurers know. You should always tell your home insurer about major works that is being done to your property or if it is not in a good state of repair. Your home insurer also needs to know about home renovations that add value, such as a loft conversion, for example.
“When you have a home insurance policy you must disclose any changes that are made the property, otherwise you may be at risk of invalidating your home insurance policy or undervaluing the property and not being fully insured.”