According to a survey by Porch, about 70% of homebuyers covet a large backyard, while about 46% are eager to have some sort of outdoor space conducive for entertaining. But not all homes have a large backyard. And some might not even come with one at all. Does that mean you should take a hard pass at investing in a home without outdoor space?
A lack of a backyard isn't always a deal breaker
While it's true you stand to lose the interest of many homebuyers if your property has no backyard, there are two distinct types of buyers who will be interested in your home.
Apartment dwellers ready for an upgrade
In many ways, selling a home without a yard is just like selling an apartment. After weathering the pandemic lockdown in a small space, there are likely some buyers eager for more living space indoors, even if it means not having a backyard. Though they might be happy about leaving HOA fees behind, they might not be so thrilled to take on all of the tasks that come with homeownership -- including lots of yard work.
Older adults looking to downsize
Many empty nesters and older adults are looking to stay in their homes during their retirement and golden years. Those who opt for aging in place rather than going to a residential or assisted living community will opt to downsize not only to a smaller home, but one easier to manage. Older adults might appreciate living in a space that's not an apartment -- while not having to worry about maintaining a backyard.
An opportunity for rental investors
While a fix-and-flip investor might think twice about buying a property without a backyard, it could be a great opportunity for a rental investor.
A landlord without a backyard is one with a shorter to-do list. You can save money and time on yard work, and you won't have to worry about any potential damage a negligent tenant may cause to outdoor space. If there happens to be a small front yard, choose hardscaping or some other low-maintenance landscaping so you can skip the watering, mowing, and pruning.
Considering the comps and location
Your decision to invest in a home without a backyard should also depend on what the other homes in the neighborhood are like. Is your property the only one in the neighborhood not to have a backyard? In that case, you'll probably need to lower the asking price, not to mention expect a smaller pool of would-be homebuyers. But if you live in a more urban area where private outdoor space is less available, you'll attract homebuyers for the other advantages city living offers.
Speaking of location, if your property is in a hot part of town or in a good school district, buyers might be willing to forgive the lack of backyard. You might have to lower the price a bit if comps do have a backyard -- but you also might attract a good deal of interest from buyers eager to live in that ZIP code.
The bottom line
While a backyard is a must-have for many homebuyers, it's not every homebuyer's dream. Fix-and-flip investors and landlords can still make a profit without outdoor space, especially if the property and location checks off other items on a buyer's wish list.