Trouble With Selling A House That Needs Repairs
There are hundreds if not thousands of houses for sale at any given time in any larger city. Combine this with the fact that new houses hit the market every single day can make it hard for houses that need repairs to compete in such a crowded market.
Many times houses that need extensive repairs will sit on the market for a very long time because the majority of buyers are looking for something that is at the current market standard and not something that will require a lot of time and money.
With home inspections being common practice for almost all traditional buyers, it is most likely that any traditional buyer will have a certified home inspection done on a property that they are planning to purchase. The home inspector will check things such as the foundation, electrical, plumbing, roofing, air conditioner, and cosmetic damage to the home. Many buyers will turn away when they get the results from a home inspection or they will ask for a large discount on the property due to the need for repairs.
These are a few of the factors that can make it difficult and frustrating to sell a house that needs repairs.
Who Buys Houses That Need Repairs
People with financial constraints – These are individuals that would like to own a home but cannot afford to purchase a house that is in top condition. Most of the time they will be looking for properties that only need minor repairs or strictly cosmetic upgrades. This could include houses that require some patching and painting of walls, some deferred landscaping, or those in need of updating.
Investors looking to buy houses – Professional investors are actively purchasing houses that need repairs as their business. They have the contractors available to take on both minor and major projects. Professional investors have more options available to them and are able to purchase a wider variety of houses because they are not just looking for a house to live in. This makes them open to buying houses with both minor problems and major problems like foundation issues, plumbing problems, and mold damage.
What Are My Options For Selling A House That Needs Repairs
Repair The House – Remodeling the house to bring it up to the current market standards while along the way fixing whatever is broken is one option and will almost always help you to sell the house.
The two big issues with doing this are time and money. The house probably did not get into its current condition overnight and it also can’t be repaired overnight. Are you in a position to wait for the house to be remodeled? Is this even a project that you want to take on? Can you live in the house while you do the renovation?
Make sure you are familiar with the local codes and restrictions. You don’t want to spend your time and money only to find out that you are selling a house with code violations.
Then there is the cost of remodeling the house. Do you have the financial means to repair the property? Even if you do, is that where you want to spend your money or would you rather spend it on the new place that you are actually going to live in?
Fix Only The Major Issues – Fixing the major issues with a property can help open you up to an additional segment of buyers. There are people who are willing to buy a “fixer-upper”, but other than seasoned investors there few people who are willing to take on a property with foundation issues, major electrical and plumbing issues, mold, or fire damage. Unfortunately, the major issues are often the most expensive issues to fix and you can quickly find yourself spending a lot of money on the property.
There are some Things To Consider Before Living In Your Renovation
Sell With A Real Estate Agent – Real estate agents can be a great resource to help you sell a home. In order to get your home ready to sell, agents will often make recommendations on what should be fixed or repaired before putting your house on the market. In the case of major repairs, agents may not take the listing at all because they are concerned about how difficult it will be to sell the property. Agents will typically charge a fee of 6% of the sales price on top of your closing costs for their assistance in selling your property.
Sell To A Cash Buyer – Cash buyers will make you an offer for the property in its current condition. Experienced cash buyers are in the market for these types of properties and they have the resources necessary to purchase and repair these types of properties. Cash buyers are not subject to appraisals or inspections so they have more flexibility to work with owners of properties that need repair. Like with anything, all cash buyers are not the same. Make sure you work with someone with years of experience in the industry and not just someone who says “Yea, I pay cash for houses”. This article has a quick video on How to choose a cash buyer.
Disclose Everything – Whether you choose to fix up the house or sell it in its current condition, make sure that you disclose everything. The disclosure should be in writing and it should be signed by your buyer. Not only is this the right thing to do, but it can also protect you down the road from someone accusing you of trying to cover things up.
Your Best Option For Selling A House That Needs Repairs
Which choice is the best option? There really is no absolute best answer. The best option will be different for different people. Take some time to weigh out the positives and negatives about each choice and then you can decide which one fits into your life and best serves your needs.
Can you afford to wait for the house to sell? Are you able to or do you want to put money into this house in order to bring it up to the market standard? Would it be better for you to sell it quickly so that you can move on to the next phase of your life? There are no real right or wrong answers, just the answers that are best for you.
If we can help you in any way please do not hesitate to reach out to us at any time. If you just want to ask some questions, if you would like a cash offer before you make any repairs, or if you just want to discuss your options for selling a house that needs repairs, we would be happy to help.