There are a number of reasons you might find yourself having to sell a fixer-upper.
Maybe you inherited an old family home. Maybe you took on a real estate project that you no longer have time or energy for. Maybe life’s sudden turns forced your hand to move out of a home you thought you’d have more time with.
Whatever the case, anyone who needs to sell an as-is property typically needs to do so relatively quickly and for as much money as possible — which is not always easy to do in most real estate markets.
But in any real estate market, there are buyers out there with their eyes peeled for a good deal. Ultimately, these are the people you’ll want to connect with when selling the property.
Here are five tips that will help you reach those prospective buyers so you can sell your fixer-upper more quickly and at a price that’s fair to you.
1. Market the House According to its Potential Value
Look through potential buyers’ eyes: They’re looking for a property with inherent value that they can build upon with a little touch-up work or remodeling.
As the team at Fortna Auctioneers in Pennsylvania writes, each home has certain qualities worth emphasizing, whether those are unique design features, the home’s location or even its historic value. Start the conversation there.
“In any marketing communications surrounding a fixer-upper, it’s important to remain focused on value,” they say. “Prospective homebuyers know that a fixer-upper will sell at a lower price point than newer or more modern homes on the market. But that doesn’t mean you need to accept a lowball offer.
“Instead, emphasize the home’s investment potential by reminding buyers of the future sale opportunities after the home has been remodeled.”
2. Sell Through a Platform That Charges Flat Fees
Scott McGillivray, host of HGTV’s Income Property, points out that one way to save significant money on a home sale is to minimize transaction costs. By cutting out these intermediary fees, both you and your buyer get closer to your ideal prices.
“With selling a home, looking at reducing transaction costs is probably the fastest way to more money in your pocket,” he says. “Also, using online brokerages like Owners.com and paying flat fee versus commission when buying and selling properties. Work through Owners.com in order to facilitate any transactions so you don’t pay a 2.5-3% commission, you pay a low flat fee, which saves thousands of dollars right there.”
3. Wait — Let the Offers Roll In Before Responding to Anyone
There’s a good chance that most of the people who make an offer on a fixer-upper are investors. In fact, Atlanta broker and realtor Bruce Ailion estimates four in five prospective buyers will be investors.
That ought to inform your strategy a little bit, or at least make the sale less sentimental than if you were selling to a local family. These professional investors will offer quick cash, but not always at a fair price, Ailion says.
So, post your ads, then wait.
“Do not respond for five to seven days,” he tells Realtor.com. “Perhaps you will have 20 to 30 offers, maybe more. Do a call for best and final due in five to seven days. Over that two-week period, you may get 40-plus offers. In two weeks, you will have a cash buyer very close to (your desired price), maybe more.”
4. Be Honest (Because The Home Inspector is Coming at Some Point)
The people who buy fixer-uppers are smart, informed buyers, so you only hurt yourself by trying to downplay the house’s faults. Buyers, especially cash investors, are fine with paying for a house that needs a kitchen remodel, but they aren’t fine doing business with someone they perceive as dishonest.
And the truth will come out because these buyers will bring a home inspector with them.
“Your fixer-upper will likely be subject to a home inspection before a sale is completed, so it’s in your best interest to be upfront and straightforward about the repairs that are needed,” the team at real estate company Redfin says. “If your home needs new windows or has structural damage that will require significant repairs, disclose all such issues as they’re certain to arise during the inspection.”
5. Buyers Will Factor Hassle Into Their Offers, But Don’t Leave a Ton of Room to Negotiate Down
When a buyer makes you an offer, it will probably be based on math that looks like this:
Offer = the home’s potential value – the cost of remodeling – how much that hassle is personally worth it to them.
The buyer already has a solid number for the home’s potential value and the remodeling costs. The only place left for negotiation is in determining how much the hassle of fixing up the property is worth.
As a result, housing markets tend to punish buyers who lowball people and sellers who highball people, Beth Braverman writes at Realtor.com.
“Pricing your property too high — thinking you’ll leave prospects with plenty of room to negotiate — may quickly scare away legitimate offers,” she says. “Plus, buyers who search for homes online (translation: pretty much all of them) often screen by price, so they may not even see an overpriced property.
“Instead, aim to price your property at or just slightly below the going rate. Today’s buyers are highly informed, so if they sense they’re getting a deal, they’re likely to