Is It Better To Sell "As Is"
Or Fix Up Your Home First? - Issue 4
This month’s Newsletter will detail what you can expect when considering your options.
When you are making considerations about selling your house there are a few defining questions to ask yourself before you put up the for sale sign. One of the questions to ask yourself is whether you should make repairs to your home or whether to sell your home “as is”. This is a very important question to consider because the buyers will be different, your marketing strategy will be different, and the prices that you will be able to command will also not be the same.
Types Of Buyers:
There are three types of buyers that fall into the different repair categories of their home. First, the majority of home buyers will be buyers that are either, families, couples or people who know very little about making repairs. And who also want to move into a home they know is in good condition. They do not want to worry about things going wrong, needing repairs or more complications during the move in process. Thus, they are only looking for homes that are in good to excellent condition and will pay a higher price to do so. As stated, this is the majority of the real estate market so if your home is being sold “as is”, you will have a fewer number of buyers to choose from.
The second category of buyers, are the ones that will be willing to fix small to medium repairs on the home. This is the type of buyer that is going to be looking for a fixer upper home. This could be someone that doesn’t have a lot of money or maybe a new family that is buying their first home and are willing to put in some extra work to make the home their dream home. This category will also include the new investors that are looking for a home with some minor cosmetic repairs that they can flip for a quick profit. These buyers are out there looking for “as is” homes that only have minor repair work needed.
The last type of buyer is the one who buys, and repairs homes, for a living. They will usually be real estate investors and some contractors. This class of buyer will not want to move into the home and are not afraid to tackle big challenges. In reality it is what these types of people do for a living so it is just in a day’s work for them. Because they do this for a living they will also usually be able to close much quicker than a traditional buyer and often will pay all cash for the house.
The Sales Price:
When you are trying to figure out the right price for your home you will want to look for the average sale price of the home in the market to determine fair market value. Keep in mind that the fair market value is based on homes that are in good condition and don’t need a lot, if any, repairs and does not include any reductions you will have to offer because of the damage to your home.
Thus, if you decide to sell a house “as is”, you must lower the price of your home to below market value in order to get it sold. It cannot command the same price as comparable houses in good conditions since home buyers will always chose your neighbor’s home instead of yours because it is in better condition.
Get Help Making The Right Marketing Decision!
If you are not sure what repairs need to be done to your home it is always a good idea to get a home inspector to come and assess what needs to be done. You may also be able to get them to give you an idea of the cost of the repairs and what it will take to bring your home up to good condition.
If you can afford the money and the time, then it is good idea to have the house repaired and sell it since you will receive the highest sales price for the home.
If, on the other hand, you need to sell your home quickly, or if you are not able to make the repairs, it would be a great idea to get with a real estate investor to buy your home. They are going to have the most flexibility, and they will buy your home regardless of condition, as long as the price is right.