Shiny new condos may get all the attention, but these days, they’re often beyond the budget of the average buyer. As prices for new construction keep climbing, more buyers are warming up to apartments that need upgrades--a “marked difference from a few months ago,” when some considered these homes too risky, The Real Deal reports. "The people that really want to buy are looking at things that need work," one agent tells the magazine.
So, is this the right approach for you? A renovation isn’t anyone’s idea of a good time, but the numbers do provide some consolation: Places in need of work typically sell at a 15 percent discount, according to one broker cited in the article, and may go up in value more steeply than new construction. Prices in new developments rose 3.5 percent, to $1.8 million, while prices for existing apartments rose 8.1 percent, to $888,000.
Aside from the obvious benefit of costing less upfront, there are other perks to buying an older apartment, from lower monthlies (you’re not paying for glitzy amenities that you may never use) to the chance to customize the home to your taste.
If you’re already shopping for a place that needs work, bring along an architect, who can envision what can be done and how much it will cost. Also, as we’ve noted before, there’s a big difference between an apartment that will need some touch-ups down the line--say, redoing the bathroom next year--than one that’s a home improvement project from the get go. Think about what you're ready to take on.