First-Time Buyers Anticipate Spending $30K On Home Repairs/Improvements

The cost of homeownership is high…and we’re not just talking about the downpayment. According to a new survey out from Thumbtack, the typical first-time homeowner anticipates spending $30,000 on repairs and improvements in the first year of owning the property. 

Given the median U.S. household income is $74,580, that means Americans spend far more on housing-related expenses than any other category, with a rising share of their paycheck going to mortgages and home maintenance. In fact, more than four out of five survey respondents were surprised by the complexity of their homes after moving in and found home projects much more time-consuming and costly than they anticipated.

An estimated 52 percent of buyers reported purchasing a home that needed significant improvements—with 27 percent of buyers who purchased a home for over $1,000,000 reporting that it needed significant upgrades. Some 64 percent of buyers say they’ve faced challenges caused by the aging housing supply such as asbestos, lead or outdated heating.

The survey found that in the face of high prices and high interest rates, 62 percent of first-time buyers had to raise their original budget, spend a greater share of their income or savings than their parents did, and accept tradeoffs in the features, size, or location of the home they ended up buying. More than one-fifth even reported feeling forced to purchase a home that doesn’t fit their needs.

Some 59 percent of respondents said higher interest rates make them more likely to invest in making their current home fit their future needs. Additionally, 44 percent are more likely to stay in their current home for the long run because it’s harder to buy.