Editor's note: This brief was summarised by The Property AI Newsroom from a report by PropertyWire. Read the original article for full details.

Demand for Renovation Properties Drops as Buyers Favour Move-In Ready Homes

A recent survey by property group LRG has found that only 6% of buyers are actively seeking properties requiring significant renovation. The research, which surveyed over 700 buyers and sellers between April and June, indicates a clear shift in preference towards move-in ready homes.

The survey revealed that 53% of respondents would not consider taking on major renovation work at all. While 41% of buyers would still consider a renovation project, they would only do so if the asking price accurately reflects the cost of the required work. According to data from Octane Capital, cited by LRG, renovating a typical property in need of work could cost £85,000 or more.

First-time buyers, who have traditionally been active in the renovation market, are showing the most significant change in behaviour. Only 5% of first-time buyers said they would actively seek a renovation project, and 43% would only consider one if the price was adjusted to account for renovation costs.

Mark Manning, Managing Director of Manning Stainton (part of LRG), commented that increased housing stock levels mean properties requiring work only sell when pricing genuinely accounts for renovation costs. The findings suggest that sellers of renovation properties may need to adjust their pricing strategies to reflect current market conditions.

The research also notes that buyers are increasingly risk-averse and seeking certainty, which may require a recalibration of the premium traditionally attached to properties with potential. This shift could impact investors who have previously targeted below-market property deals requiring refurbishment, as competition for such assets may decrease.

For letting agents and inventory clerks, the data highlights the importance of transparency around renovation costs and realistic pricing in the current UK property market.