With Millennial first-time buyers taking advantage of record low mortgage rates and jumping into homeownership, many are likely unaware of the projects they may have to undertake to get their new home move-in ready.
New research and survey data from Thumbtack and Zillow find a typical for-sale home could need nearly $30,000 of work, which could come as a shock to the large majority (65 percent) of active home shoppers who are not seeking a fixer-upper.
To help first-time buyers feel prepared for the home-buying journey, Zillow compiled a list of the most common projects its teams tackle after purchasing homes through Zillow Offers, a service that allows sellers to skip prep, open houses and showings by selling directly to the company.
Using that list of common repairs, Thumbtack – a home-management platform – calculated the national average costs to complete each project.
According to the new survey of 1,000 buyers, the average Millennial expects to pay between $10,000 and $15,000 to make a home move-in ready, when in reality, the data show new homeowners should actually expect to spend about $26,900 on these projects. Evaluating, repairing or replacing HVAC systems is the most expensive move-in project, costing $3,615 on average nationwide.
“This research suggests first-time homebuyers typically underestimate the costs of the unsexy projects they may have to tackle before they even move in,” says Amanda Pendleton, a Zillow home-trends expert. “That sticker shock may be increasingly common in a competitive market, where buyers are dropping inspection contingencies as a strategy to win a bidding war.”
Her strategy: “Make sure to factor in these unexpected costs when making an offer to make sure you can afford them, or nail down the tradeoffs you’re willing to make for a move-in-ready home,” Pendleton said.
Homebuyers say they’re most excited about improvement projects that allow them to express their personal style and make a home feel like their own. Millennial homebuyers are most excited to tackle interior painting ($385/room), followed closely by wallpaper installation ($530/room) and kitchen updates like remodels and renovations ($7,445).
Buyers are least excited about making roofing repairs, which cost an average of $800 to evaluate and complete. This is followed by general plumbing repairs ($335), painting the entire exterior ($2,415) and repairing damaged floors ($315 to $1,245, depending on the type of floor).
These projects tend to be more time-consuming or require a deeper level of expertise to complete, which can make homeowners feel out of their comfort zone.
“Homebuyers are most concerned about the hassle of home maintenance and repairs. It feels overwhelming to know where to begin, but also, who to entrust with your most valuable possession,” says David Steckel, Thumbtack’s home expert.