Any tips on selling a house "as is" ?

[Lsbcal]

I’ve inherited a much neglected house after my Dad’s second wife passed away. She was 95 and had some severe mental problems. We are going to be talking with a few realtors tomorrow and they both mentioned selling the house “as is”. I don’t have any experiences with “as is” property selling.

I imagine one just either (1) fixes up the house to the neighborhood standard and then sells to a normal buyer or (2) one sells “as is” with little or no fixing up. I imagine the “as is” buyer for this wants to quickly renovate and sell at a decent markup. The kitchen needs to be completely redone, all floor coverings need to be replaced, new paint of course, window replacements, etc, etc.

I’m guessing that if I paid others to fix some things this would be more costly then lowering the house price to compensate the “as is” purchaser who probably has access to cheaper labor and materials. In other words, there is not really a middle ground in the fix up process.

Any thoughts on this from others who have sold or bought “as is” property? This house is in a decent neighborhood in Northern California. I’m 1 hour drive away and have no desire to do any labor to fix it up or to supervise a fix up. Some of the proceeds from the sale will come in handy to help our son who is getting married soon.

 

[Souschef]

IMO, sell it as is. You will never recoup the upgrades. Let the buyer select the kitchen upgrades and floor coverings after they buy it.
Also since you are an hour away, you do not want to deal with contractors that show up late or do not show up at all.

 

[Scrapr]

You might look at selling directly to a developer or flipper.The Realtor may have a contractor in their contact file as well.If you sell to a flipper directly you save the commision.

Kind of depends on how "hot"your market is. Bay Area probably no problem.Weed,Ca probably want some help there

 

[kcowan]

When MIL passed, the realtor said to sell as is. It was sold in a week for asking. The house was 45 minutes away from us.

 

[tb001]

FWIW, most of the properties we looked at in the Bay Area were sold as is, regardless of condition. We sold our home, which was in decent condition, this way as well. The bigger issue would be if there is anything which would prevent getting bank loans for the house. Those things are worth fixing, imo. Beyond that, it depends on your local mkt.

 

[Another Reader]

IIRC, you are in coastal California. If so, there will be a very competitive market for the property. To get the highest price, you need maximum exposure to all the potential buyers. Do NOT let an agent persuade you to sell as is, off market, because of condition. You will not get the full value.

 

[mountainsoft]

When my mom had a stroke a couple years ago, we weren't sure if she would be able to move back home. So we spent the first few months just mowing the yard and cleaning up the garbage around the house. When she moved into an assisted living home I originally planned to sell the house as-is, but knew she needed to get as much money from the house as possible. She lived two hours away from us, so it took us several more months of cleaning, painting, and updating the house to make it saleable:

Fixing Up The Dallesport House

We spent about $6000 fixing everything up, but were able to sell it for about $100,000 more than it would have sold as-is. It was a lot of work and a major time investment, but it really paid off in our case.

 

[tb001]

I missed the off market bit. We sold off market for very specific reasons, but I would never recommend it, especially with a fixer!

Eta, the other factor to consider is ongoing costs of ownership/operating. If you’re in an area with a luke warm market, just paying taxes and keeping the house in decent shape while you’re waiting to sell could cost more than upgrades needed to make it move quickly.

 

[Bamaman]

The question is how much will the house pull on the market as is?
And how much will a coat of paint and new flooring cost?

If you have "no desire" to spend time and labor working on the house, how about getting your son to be the project manager--since he's getting married and needs funds to start a new life. Or, find a painter or home repair man that can ride herd over the job.

But there again, we have not seen the house and the condition it's in.

 

[Qs Laptop]

I just went through this process with my mother's house. It sold in three days and we're closing at the end of the month. Got 5% more than the list price.

It wasn't in terrible shape but it needed to be updated. It had the look of the late 90's inside. All carpeting and vinyl flooring needed replacement. All window coverings needed replacement. All rooms needed to be repainted. The refrigerator was the only newer appliance.

Talked to several realtors and they had varied opinions.

* Sell as is. Don't do anything except remove junk and declutter.
* Just repaint the living room.
* At minimum, repaint every room.
* Pull the carpets up and refinish the hardwood floors underneath. Replace vinyl floor in kitchen. Repaint everything. Replace window coverings.

It's difficult to know the return on investment. Plus, once you start making changes, things start to snowball and can get out of hand.

Floors and window coverings are tricky. How do you know what the buyer's going to want? Better to leave that to their own judgment and their own selection.

I decided the thing to do would be too present potential buyers with a good first impression. I figured if I could get them to like the house in the first minute or so I might be able to grab them for good. To that end I repainted the living room, kitchen, bathroom, and master bedroom. Also repainted the closet in the master bedroom and the entryway closet and hall closet. I removed all window coverings, just left bare windows. I replaced a couple of ancient light fixtures. Put in new electrical outlet covers and switch plates covers.

I had help from some family members. It took a couple of weeks, a lot of that time was spent on wall repair, patching and sanding. I spent about $750 on paint, supplies, light fixtures.

I hired one of those junk removal companies--"just point at it and we'll haul it out". That was $575 and was money well spent. I could have rented a dumpster for $450 and hauled stuff out myself, but spending the extra $125 was a no brainer.

Finally, I had a cleaning company the realtor recommended clean the whole house, top to bottom. That was $350.

I suppose I've got about $2,000 into it and a decent amount of sweat equity.

I had a house flipper look at it before we did anything and he made an offer that was a lowball offer. He would have bought with cash, taking care of everything including e city inspection and removing the junk. But his offer was so low I was insulted, so I rejected it. I ended up getting $53,000 more then the flipper offered.

It sounds like you don't want to do very much work. My advice would be to do the minimum amount needed to get the areas of the house the buyer will see first looking presentable.

 

[aja8888]

When my mom had a stroke a couple years ago, we weren't sure if she would be able to move back home. So we spent the first few months just mowing the yard and cleaning up the garbage around the house. When she moved into an assisted living home I originally planned to sell the house as-is, but knew she needed to get as much money from the house as possible. She lived two hours away from us, so it took us several more months of cleaning, painting, and updating the house to make it saleable:

Fixing Up The Dallesport House

We spent about $6000 fixing everything up, but were able to sell it for about $100,000 more than it would have sold as-is. It was a lot of work and a major time investment, but it really paid off in our case.

Lots of work, but really nice job and outcome!

 

[rodi]

When MIL moved to a memory unit, DH had the task of selling her home. He picked a middle ground.... Carpet downstairs was stained so it was replaced with inexpensive pergo type flooring. Interior was painted throughout. Kept the out of date appliances (white). Didn't update counters in the kitchen, or bathrooms.

There was a real risk of spending too much for the market it was in. But the 'lipstick on a pig' paid off with a quick sale at asking price. Buyer appreciated that he could turn it right around and rent it out with the flooring and new paint.

I live in an older (50+ year old homes) but expensive neighborhood with great schools. As the original owners die off (yes, that's what's happening) homes are being sold as is for very high prices... Buyers are then spending a month redoing things before moving in. This has happened to several homes on my street within the past two years. So that would be an argument for doing nothing.... In this neighborhood, demand is such that there is no need to fix up, homes sell fast regardless of dated finishes.

You have to look at the neighborhood to determine if the improvements will provide a return.

 

[Lsbcal]

Thanks for the comments everyone.

As I mentioned before, this house needs a LOT of work. The kitchen appliances don't work, cabinetry is a disaster, linoleum floor must be replaced, all carpeting must be replaced, needs full painting throughout, furnace needs replacing, front door replace (there are 5 locks on it), closet doors are weird, etc. These are just the things I easily remember inside.

On the outside, there is a closed structure attached to the house that needs to be demolished. Wood rampway leading to front door must be demo'd. Landscaping is a mess.

It goes on and on. There are unknowns I am sure.

Houses in this area are in the $450k range or so.

 

[38Chevy454]

I agree with the clean it up so it has a decent first impression, but no major work. Not even painting, just cleaning and getting rid of any junk, and make sure all lights and fixtures work. Sell as-is will not only save you from the investment of time and money that you may or may not recoup; but the other big factor is that since you do not know the house real well, you list as-is and then no risk for a buyer coming back after the sale for something. To me that is one of the biggest factors with all the disclosure stuff that is required now when selling a house. As-is avoids any potential hassle.
Once the house sells, call the estate sale companies, and let them take care of the house inside stuff. After you take anything you want for yourself or relatives. Don't try the estate sale by yourself. Just pay the fees for the estate sale company commission and collect the proceeds.
Also agree do not list off market. You want max exposure if the area is a good area with good buyers. The house will sell, if you price fair for the condition and accept that as-is will be reduced a little (not a lot).

 

[Another Reader]

When my mom had a stroke a couple years ago, we weren't sure if she would be able to move back home. So we spent the first few months just mowing the yard and cleaning up the garbage around the house. When she moved into an assisted living home I originally planned to sell the house as-is, but knew she needed to get as much money from the house as possible. She lived two hours away from us, so it took us several more months of cleaning, painting, and updating the house to make it saleable:

Fixing Up The Dallesport House

We spent about $6000 fixing everything up, but were able to sell it for about $100,000 more than it would have sold as-is. It was a lot of work and a major time investment, but it really paid off in our case.

You did a fabulous job and your mother raised a wonderful son!

 

[Lsbcal]

Had not heard of the terms "off market" so thanks for mentioning this.

An estate sale is possible but not a whole lot to gain I think. Still I'd like to not fill the dumps any more if someone will have this stuff. I'll ask about an estate sale person to manage this.

A lot of stuff had disappeared from the house over the years. I really don't think it amounted to much money but will never know.

 

[CardsFan]

Houses in this area are in the $450k range or so.

OK. We are not talking about a piddely little house. This is some serious money.

I think you need to really think about what you could get with upgrades.

$10k to upgrade a $60k home to get maybe $90k, probably not. $30k to upgrade a $350k home to get $450k, yeah, probably.

That said, If it would be a major amount of work, and I had to do it, I might still go "as Is".

 

[brucethebroker]

Bruce the (real estate) broker, here.
You can go either way. You can fix up a little (many suggestions already) or leave it alone. Either way I suggest you offer it "as-is", yet still allow the offer to be contingent upon a home inspection. In our area (Midwest), that means that the buyers can walk away if the inspection shows too much work. And it means that you will not pay to fix anything as the result of an inspection. That will provide comfort to those who might not have looked at "as-is" homes before.

With all the fixxer shows out there, many buyers want to do all the "fixxing" themselves and either live in the home, or try to flip it. Ask the Realtors if the house, as is, will qualify for a mortgage. Usually, in that price range, it will. good luck!

 

[joeea]

I’m guessing that if I paid others to fix some things this would be more costly then lowering the house price to compensate the “as is” purchaser who probably has access to cheaper labor and materials. In other words, there is not really a middle ground in the fix up process.

There's always a middle ground. It usually depends on how bad the house is.

You could do the labor yourself. You could pay others to do minimal work and make it capable of being sold but less than neighborhood standards.

Sometimes, it's worth paying to get it cleaned up and perhaps painted, but not updated.

But if it's in bad shape and you want to be done quickly, talk with several agents about as is sales.

 

[RunningBum]

I agree with the clean it up so it has a decent first impression, but no major work. Not even painting, just cleaning and getting rid of any junk, and make sure all lights and fixtures work. Sell as-is will not only save you from the investment of time and money that you may or may not recoup; but the other big factor is that since you do not know the house real well, you list as-is and then no risk for a buyer coming back after the sale for something. To me that is one of the biggest factors with all the disclosure stuff that is required now when selling a house. As-is avoids any potential hassle.

I think that's a big point. If you start to do repairs, and find more wrong with the innards (plumbing, electricity, HVAC, roof, moisture damage, etc), you have to disclose it. If you don't find those things, it's up to the buyer and inspector to uncover it.

OTOH, if you really think the bones of the house are good but all the surface area stuff is bad, it would probably be better to fix things. If it's a mess on the surface, you'll scare away a lot of people who figure it's a mess all over, and you'll just get low-ball offers from flippers. But, it will be less hassle. Depends on whether you can find someone to do the work reliably. A realtor might have a recommendation for you.

 

[ERD50]

Is there a chance it would be a "tear-down" to a new buyer? In that case, no sense to put a penny into it.

-ERD50

 

[aja8888]

I agree with the clean it up so it has a decent first impression, but no major work. Not even painting, just cleaning and getting rid of any junk, and make sure all lights and fixtures work. Sell as-is will not only save you from the investment of time and money that you may or may not recoup; but the other big factor is that since you do not know the house real well, you list as-is and then no risk for a buyer coming back after the sale for something. To me that is one of the biggest factors with all the disclosure stuff that is required now when selling a house. As-is avoids any potential hassle.
Once the house sells, call the estate sale companies, and let them take care of the house inside stuff. After you take anything you want for yourself or relatives. Don't try the estate sale by yourself. Just pay the fees for the estate sale company commission and collect the proceeds.
Also agree do not list off market. You want max exposure if the area is a good area with good buyers. The house will sell, if you price fair for the condition and accept that as-is will be reduced a little (not a lot).

Usually, what happens to houses like this around here (hot market), once you decide to list on the MLS, is that a real estate agent or investor contact will scoop it up ASAP.

 

[Lsbcal]

So clearly I could get an estimate on obvious defects and reduce the house price by something like 150% of these costs. Or is that the right percentage?

Also do any sellers offer an account that can be drawn from to do some repairs? Maybe something (wild guess) like 50k for a kitchen remodel and other miscellaneous repairs? Or is this just an invitation to defraud?

 

[Lsbcal]

Is there a chance it would be a "tear-down" to a new buyer? In that case, no sense to put a penny into it.

-ERD50

I don't think so. The location is not prime and some houses in the neighborhood are not looking snazzy ... like weedy front yards. You would think at these house prices more care would be done. But this is California real estate and the mind boggles at the pricing.

 

[tb001]

My guess, from the items you’ve detailed, is that you’re going to be far more picky than a potential buyer. I think you’re better off finding a good agent and getting good advice on pricing as is, assuming there’s nothing that needs fixing in order to qualify for a loan.