Among homes that Americans are most likely to own are, first, primary residences, and second, vacation homes, which can also be rented. More intrepid buyers, and likely a small minority of them, are intrepid enough to buy broken-down houses and attempt to rebuild them. Successful real estate purchases rely, among other things, on location, location and location.
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Realtor.com has listed the best cities to buy a so-called fixer-upper house. Most are small and cities no one has heard of. They are in counties that include Lorain, Ohio, and Fulton, Ga. Interestingly, among the 10 best places to buy fixer-uppers, four of them are in Ohio and Indiana, the old Rust Belt. Philadelphia is the only large city on the list.
According to Jonathan Smoke, the chief economist of Realtor.com, they set a few parameters and found a fairly limited number of homes that fit them:
This strategy is better suited to areas with a good supply of older homes, which need more TLC. It could be a good approach for millennials, who tend to prefer urban or near-suburban areas but are constrained by what they can afford.
Also:
To find locations with the best prospects for getting an edge in the market, (his) team analyzed the 513,506 listings for midsize single-family homes on our site in March. By limiting their search to homes of 2,000 to 4,000 square feet whose descriptions included keywords such as “fixer,” “as is condition,” “with potential,” “handyman,” or “TLC,” they identified 7,242 homes as fixer-uppers.
Then they figured out which areas have a greater supply of fixer-uppers, and where those homes cost substantially less than a comparable home that is move-in ready. We’re calling that price differential the fixer discount. They used that combined with the availability of fixer-uppers to calculate the Fixer Score for each county. Philadelphia, PA; Lake, IN; and Marion, IN (home of Indianapolis) were on top of the rankings for fixer-upper potential.
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The top 10 cities to buy a fixer-upper house:
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