May 26 2019
What to Consider When Deciding to Upgrade
If spending money to make money on your property seems counter-intuitive, you might attempt to sell your home “as-is” and keep your money for the new place. After all, most of those homes featured on renovation reality shows are in worse condition than yours; and those buyers intended to gut the place for a complete makeover anyway.
Just know that the offers you receive will reflect the needs of the buyer, so you won’t get top dollar unless the property is in an extremely desirable area. Still, it might make sense to sell as-is for a discount if your situation is difficult or you’re strapped for cash. Conversely, selling a home that isn’t up to code reduces your buying pool. FHA and VA loans require a home to meet minimum property standards to secure the loan.
Another consideration is how much you still owe on the property. Unless the investment for repairs and upgrades is more than your remaining mortgage, it is probably worth spending to bring your property up to code. A qualified real estate professional can help you prioritize your repairs to those necessary to get it sold, or market it to buyers looking to renovate to raze the home.
So, who buys as-is?
Investors often purchase property intending to “flip” it; that is, to renovate a distressed property and quickly resell it to recoup expenses and make a profit. Typically, investors want the “bones” of the property to be sound, so foundation and structural issues are less appealing to them.
Another type of investor wants the property for its proximity to business or industry. Their goal is to have the property rezoned for commercial purposes or to build multi-family structures on it instead. If the area around your home is transitioning to commercial or multi-family dwellings, your professional real estate agent can guide you to this type of investor.
Less common is the buyer that wants a project or fixer-upper on which to put their own stamp. Some fixer-uppers buy for nostalgia (they lived in the home/area as a child) and others for what they know the area can become. Their goal is to restore the home to its former glory while adding newer amenities. As opposed to flippers, these buyers often intend to live in the home while working on it, or once the work is complete.
If you determine that selling as-is is the best option for your situation, discuss the issue with your agent. She can warn you about what to expect for offers with your home in its current condition and help you set a fair asking price based on its location and the market trends in your area.