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There’s no way around it; you’re stuck.
Your home needs a lot of work, and you can’t afford to fix it up. You want to list it, but who’s going to buy a money pit? There are things you can do to make your home more attractive to potential buyers without spending your life savings. There are also ways to get around making any investment in repairs and not forking over one single penny.
Can You Sell a House That Needs Repairs?
We know this is a common question, and the answer is yes! Just because your home needs renovations doesn’t mean you can’t sell it. There are ways around paying for big-ticket fixes. We’re going to explore what it would take for you to make some minor repairs, apply for a home improvement grant, or sell the house as-is.
Your Options for Selling a Home That Needs Repairs
Before you get started, let's consider not only your options for selling, but also who will be buying your home. What is the condition of your home? Is it out-dated only cosmetically, or are there significant structural and system repairs that are needed? How you answer these questions will determine whether you should list your home or if you should sell your home to an investor as a fixer upper.
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Make Some Minor Repairs
A home inspection is not always needed, especially when you are selling a house that needs repairs, but if you want to get a good idea of the repairs you would need to make to your home, this is a good place to start. If you can’t afford major repairs, focus on the minor fixes that may make the home more attractive to potential buyers. Tasks like adding fresh paint, installing new hardware, or patching drywall don’t have to cost a lot of money.
Curb appeal is a good place to start. First impressions matter. If a potential buyer falls in love with the exterior of the home, they may be willing to invest the money to make it look good on the inside, too. Simple activities like power washing your driveway or trimming back overgrown bushes can make a huge difference.
What home improvements add the MOST value?
Home improvements that add the most value include hardwood flooring refinish or new wood flooring, minor bathroom remodels, minor kitchen remodels, fresh paint, landscaping, and exterior improvements. Home improvements that buyers can see will impress them the most.
What home improvements add the LEAST value?
Home improvements that add the least value include expensive lighting, bright and bold paint colors, sunrooms, and adding swimming pools or hot tubs—just to name a few.
PRO TIP: If your home only needs minor repairs such as these, your best option for selling might be to list your home on the traditional MLS through a real estate agent! I'm hesitant to promote minor repairs to a distressed property. Inevitably, there are other concerns that will cause lending, inspection, or appraisal issues. If you solve one problem but leave a host of others, it's difficult to see how you have improved your negotiating position. You also risk making an improvement that the end buyer doesn't find as desirable as you anticipated. For example, I wouldn't recommend painting walls if the floors need to be changed and the major systems need updating. Protect your cash!
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Get a Home Improvement Grant
You may be eligible for a government-sponsored home improvement grant to update your property. This is not a loan, so you don’t have to pay the money back.
A good place to start looking for a home repair grant is your local Housing and Urban Development (HUD) office. The HOME Investment Partnerships Program, for example, is designed for low-income homeowners. Organizations such as the National Residential Improvement Association and the U.S. Department of Agriculture (USDA) also distribute home improvement grants. Eligibility and requirements vary depending on which home repair grant you’re applying for. The details are usually tied to income, location, and the type of project. The USDA requires the property to be in a designated rural area and the money to be used to address health and safety concerns or improve accessibility.
PRO TIP: Grants can be valuable for homeowners. They are usually restricted to owner occupants (not available to investment or inherited properties). They often have some restrictions placed on them. For example, you might suffer a repayment penalty if the house is sold within "X" number of years or have a similar string attached to the improvements that the grant funded. Depending on the grant, you may also be responsible for sourcing or managing the quality of the work. Do your research and understand the details of the grant. If the situation is appropriate, they can be a valuable way to improve your property value. We see this being a total love it or list it scenario. By the end of the process, you might not want to sell your home!
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Sell Your Home As-Is
It’s not impossible to sell your house as-is. Some buyers look for houses that need work so they can renovate and resell. Buyers with smaller budgets may prefer to purchase a home for less and do the repairs themselves to both save money and add personalization. This is a great option for selling a house that needs repairs.
If you’re working with a real estate agent to sell your home as-is, you’ll have to give them (and potential buyers) full disclosure on what’s wrong with it. You will likely get less money than you were hoping for. If you choose to sell your home as-is through a traditional listing, the way to best market your fixer-upper is to focus on the positives. Features like a great location, a huge lot, and flex space can overcome the negative cosmetic aspects. Be sure to price it appropriately and be aware of whether you’re selling in a buyer’s or a seller's market.
PRO TIP: Remember the deal isn't done until the house closes! If you receive an offer with an inspection contingency, don't be surprised to see an altered offer amount after the purchaser has completed their due diligence. Prioritize simplicity in the offer you accept and check for a reputable business profile on Google or the Better Business Bureau. Value cash over lending. Many people assume they can get financing, but they may not be aware of the challenges of completing lending on distressed property.
There are many advantages to selling a house as-is. If you are not familiar with the home improvement space it is easy to underestimate the complexity, cost, and difficulty of completing the process. It's easy to spend too much of your own cash and find yourself in a difficult position without a clear path to completion! There are many investors who specialize in acquiring distressed property. Letting them compete for your property can yield you a strong return without the risk of completing a remodel.
How to Sell a Run-Down House That Needs Repairs: 5 Tips
Selling a run-down property can be a difficult task, especially when compared to the homes on HGTV. In reality TV, it insists to the public that an ideal home needs to be in a perfect location with upgraded interior designs, stainless steel appliances, and beautiful lawns. They do this to create a hype, all for the show. Although we can't deny that these houses are very attractive, many homes that appear on TV have been meticulously arranged to make it look immaculate. In reality, many homes are in poor condition, posing greater marketing challenges compared to “average” or “normal” properties. However, with the right approach, not only can you turn a profit, but you might also be pleasantly surprised with the results! To help you out, here are our 5 tips for selling a run-down house.
Tip #1 Improve the Curb Appeal
Your house's curb appeal is worth a thousand words when it comes to getting a sale. One rule about selling any property is you need to put yourself in the shoes of the buyer. How is the property compared to other properties in the neighborhood? What makes it different? Walk around your house and evaluate its condition. How would you rate the design? The ambiance? If it looks neglected but still repairable, you might need to improve the overall appearance of the house. Here are some ways to do this:
- Grab a broom and start cleaning
- Fix your fences and mow the lawn
- Clean your driveway and remove fallen leaves
- Clean your walls
- Paint your walls and ceiling
- Remove all spider webs or any sign of decay
- Plant flowers and plants to create an outdoor ambiance
Tip #2: Highlight the Best Features
You were likely drawn to this home by a few key concepts; therefore, it makes sense to highlight those points for the next buyer. Even though it needs some updating, your home may have appealing features such as:
- A spacious closet
- An open floor plan
- A master suite
- A home office
- A fireplace
- A patio
It’s more important for the house to have good bones than trying to determine if the decor is the potential buyer’s preferred style. They can change carpets to hardwood floors; they can’t alter the school district or the home’s proximity to the park. With virtual staging, you can even help the next buyer see what the home could look like after renovation. This is where a photographer takes photos of your house as-is, then an artist creates renderings that showcase the home’s potential.
Tip #3: Sell the Location
From a buyer's perspective, the property's location is critical. Dealing with a run-down house may get complicated. If you're at a wrong spot, you might need to do a lot of compromising. But, before you feel hopeless about selling your house, always keep in mind that the location is subjective. To some buyers, it might be a deal-breaker, but to others, it may be exciting and challenging.
Tip #4: Time Your Sale
Always wait for the right time. In real estate, winter is not good news, especially when you have a run-down house. If you have already decided to sell your home, wait until spring or summer. In summer, days will be longer and sunnier, and this could add up to the ambiance with the lush green trees and flowers blooming around. Buyers also mostly look into houses in the summer or spring.
Tip #5: Price the Home Correctly
When deciding on a sale price, seek help and advice from a professional. Letting a listing sit in a market is not a good sign.
You don’t want to try to make the home into something it’s not. If you want to sell it, it’s best to price it as a fixer-upper and not as a turnkey property. Though most buyers are looking for a move-in-ready home, there are people out there searching for an investment project. Here’s how to figure out the right price for your outdated home.
- Begin by calculating the value of your house if it was already renovated
- List all the required upgrades and their corresponding costs
- Separate the most important tasks from the least important ones
- Decide which renovations you can afford (and want) to do yourself
- Subtract the buyer’s costs from the value of the home
- Arrive at your asking price
Can You Sell A House That Needs Repairs For Cash?
If you don’t want to go through the hassle of listing your home on the traditional MLS, there is another option for you! Selling your home to a cash buyer might be your best option if you are going to be selling a house that needs repairs.
The buyer of your home as-is will likely be one of three types of people:
- A flipper who wants to renovate the home and sell it for profit
- A bargain hunter who will invest in renovations because of the location
- A remodeler with money to spend on their vision of the perfect home
If any of these potential buyers require financial assistance, it’s going to take several days or possibly months to get to the point where you hand over the keys. However, a cash buyer can give you a fast and fair offer within minutes of evaluating your property and close the deal in as little as seven days.
Sell Your Home to a Cash Buyer
When you sell your home to a cash buyer, there are no repairs to be made. There’s not a lot of back and forth on the asking price. And there’s little time wasted waiting for the deal to go through.
Selling to a cash buyer is a quick process that allows you to get rid of your home and put money in your pocket. The steps are simple:
- A fair cash offer is made.
- You contact the cash buyer.
- They evaluate the home.
From there, the closing process can take less than 10 days. You don’t even have to move out the contents of the home if you don’t want to, which is a great benefit if you’ve inherited a property.
PRO TIP: Cash buyers can be a great option, and there are many benefits of selling a house for cash. They represent simplicity, speed, and convenience. Try to verify that the buyer is actually the investor, not a wholesaler looking to sell your contract. A wholesaler can back out of the contract with limited warning and leave you in a difficult position. Remember to push for non-monetary concessions depending on your needs. For example, it may be beneficial to have time after closing to finish removing possessions, or you may want to leave the house "as-is" without cleaning it out, or close on a specific day of your choosing. Reputable cash buyers should be very flexible with your requests.
Are You Selling a House That Needs Repairs? New Again Houses® Can Help!
New Again Houses® buys houses as-is in any condition and transforms them into fully remodeled homes families can enjoy for years to come. We will never sell your contract or your information and would love the opportunity to invest into the community by making your older home new again. If you need to sell your house fast, you can trust us to make you a fast and fair cash offer for your home.
Are you ready to sell your house fast, get a cash offer, and close in a matter of days? Contact us today to get started.
