Sep 16, 2023 - Real Estate

Fixer-uppers are scaring off Des Moines home buyers

Illustration of two hammers forming an "X" shape.

Illustration: Maura Losch/Axios

Des Moines homeowners looking to sell for top-dollar should be thinking: renovations.

Why it matters: Homebuyers already hampered by gravity-defying prices and mortgage rates don't want to spring for a place that looks like an HGTV "before" photo. (Unless you're actually on HGTV.)

  • "If the home is ready to go, buyers feel more comfortable biting off the higher payment," local broker Jen Stanbrough tells Axios.

Zoom in: People will wait for their turnkey house. It's one reason Des Moines homes are staying on the market a little longer compared to a year ago, according to local broker Ted Weaver.

Yes, but: That doesn't mean sellers need to cash out to completely redo their kitchen, bathrooms and basement. Installing dome lights and swapping in brushed nickel cabinet pulls or door knobs are easy refreshes, Weaver tells Axios.

  • It's worth investing in a fresh coat of paint and new flooring, which can set you back $15,000 or $20,000, depending on the size of your house, Weaver says.

The big picture: Self-identified fixer-uppers are typically selling for less, and more slowly, than expected, according to Zillow data shared with Axios.

  • Across the U.S., listings that mention "fixer-upper" — 0.3% of sales in the first half of the year — sold at a 3.1% discount and took 3.2 days longer to sell relative to expectations, per Zillow data shared with Axios.
  • Listings pegged as "remodeled" or "renovated," which accounted for 24.1% of U.S. sales, sold at a 1.2% premium and 1.8 days faster than expected.

"Most home buyers right now simply don't have enough money left over to invest in major repairs or remodeling," Redfin deputy chief economist Taylor Marr tells The Wall Street Journal.

Data: Redfin; Chart: Axios Visuals
Data: Redfin; Chart: Axios Visuals

By the numbers: More than half of metro Des Moines homes in July were snapped up in two weeks or less, according to Redfin data shared with Axios.

  • Nationwide, roughly 41% of listings were marked pending, contingent or sold within that window, Redfin found.

State of play: Houses that stay on the market for more than a month are usually overpriced or in need of major work, according to Redfin's Taylor Marr.

  • We spotted this Fairmont Park home, described as requiring some TLC, with run-down flooring and cabinetry on its last legs. Listed for $205,000, it's spent more than 30 days on Redfin.
  • Des Moines-area homes go off-market after a median of 13 days, compared to eight days a year ago, per the real estate brokerage.

Be smart: "Fixer-upper" listings comprised 0.2% of sales here in the first half of 2023, per the Zillow data, while those advertised as redone made up 28.5%.

Go deeper: Americans' homes are worth more than ever, but tapping into that value isn't easy


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