Once you decide to list your house for sale, one of the most commonly encountered challenges is the dilemma of deciding whether to sell the house as-is for a fairly lower price or make all the necessary renovations to make more money from the sale. There are several factors to consider before making this decision.
While selling as-is has the advantage of a faster and easier selling process and saves the seller the cost of renovations, it also has its challenges such as lower sales price. On the other hand, making renovations in the house before selling tends to generate a higher income from the sale, however, profit isn’t always 100% guaranteed, and the seller stands the risk of trading at a loss if they’re unable to recover the total cost of the renovations.
Pros Of Selling your Home As-Is
Selling your home “as-is” is a real estate term that means you’re selling the house in its current conditions without making major repairs in the house. Some of the advantages are:
- Saves Cost: One of the major reasons why people choose to list houses for sale as-is is to avoid the high cost of making major repairs in the house before selling. If you don’t have the financial capacity to make repairs or renovations before listing your house for sale, selling as-is might be the best option for you as most home buyers and willing to buy houses listed for sale as is.
- Sells Faster: A house listed for sale as-is will take less time to sell as it enables homeowners to bypass the lengthy time needed to make house repairs and renovations. You can list your house for sale as-is if you’ve already gotten a new home and need to sell your present house fast.
- The Sale Process Is Easier: If you want to avoid the rigorous process of house inspections, staging, open houses, and other preparatory stages involved in renovating the house before you sell the house, you can choose to offer the house for sell as-is, as this method of selling hardly require any of such processes.
Cons Of Selling As-Is
- Sells For Less Money: The first impression buyers get when you list your house for sale as-is, is that the house isn’t in good shape or that the house needs major repairs. This isn’t far from the truth. You’re not likely to get the same sales price as that of houses that have been fully renovated and staged. You may seek the help of an expert realtor to help you arrive at a fair listing price, taking into consideration the level of repairs or renovations the house needs.
- Fewer Offers: Most buyers are likely to view your home negatively when you list it for sale as-is. The phrase raises alarm bells in the minds of most buyers and this might limit the offers you get. Furthermore, not everyone is ready to buy a house in need of major repairs. Some want houses they can move into with little to no repairs. This might shrink your chances of attracting more juicy offers.
- Haggling: Most buyers offering to buy houses as is often start at a ridiculously low price, and you’ll need sharp negotiation skills to haggle and get the best price possible. You may also choose to allow your realtor to help with the negotiations to get a fair offer.
Pros Of Renovating Before You Sell
- Increased Value: Your house is most likely to be valued a lot higher if you’re able to invest in renovating it. The increased value will ultimately translate into increased revenue compared to selling as-is. When your house is in top shape, you can feel confident to attach a high listing price because you know the house’s worth.
- More Offers: Houses that are in top-notch conditions will attract more offers as most people want to move into houses that are move-in ready and in need of little to no repairs. Renovating your house before selling also reduces buyer objections, and this leads to an increase in the offers you’re likely to receive.
- Better Competitive Advantage: Homes that are in move-in conditions have a better competitive advantage to those that need major repairs for obvious reasons. If you’ve had your home listed for a long time without receiving any reasonable offer, you might want to consider upgrading it a bit to increase its competitive worth.
Cons of Renovating Before You Sell
- High Cost Of Renovation: Renovating your house can be capital intensive, depending on the type and level of repairs needed in the house. It’s important to take into consideration the kind of market in your area before deciding to renovate. You can also reduce costs by renovating only areas that are in dire need of repairs.
- Takes Longer Time: As opposed to selling as-is, renovating a house takes time, especially if you’re doing major house repairs and during this time, the market may change. If you want to sell your house as fast as possible, you might not be able to afford the time needed to complete renovations.
- Risk Of Trading At A Loss: There’s no guarantee that you’ll get back all investment in renovations. While it’s true that renovations can improve the value of your house, you may still find it difficult to recover the total cost of repairs, especially when you have many competitors.
Conclusion
The question of whether to sell your house as is or make the reservations isn’t a simple yes or no question. If you want to get the best price possible, you need to weigh the consequences of both actions before making your choice. The above-listed tips will guide you in making this crucial decision.
Bonus Tip
Here are some minimal changes that you might want to consider that can also add up the value of your house before selling and can be an attraction to your potential buyer. These are the home experts’ thoughts on what projects are worth the time and money — especially that you are planning to sell.
1. Kitchens and bathrooms
Kitchens and bathrooms are where the money should be spent, and that’s where you’re going to get the return on the investment. A kitchen update can give back almost 80% of what you invest if it’s done properly.
Consider a mini-makeover: repaint the cabinets, update the countertops, replace a dated backsplash, and possibly upgrade the appliances.
As for bathrooms, while some clients embrace the vintage look with colored tiles, most prefer a bright new space with an expansive shower, a soaking tub — maybe illuminated by a chandelier — and an elevated vanity.
2. Painting
A little bit of paint can make a huge difference inside and out, and it’s one of the least expensive improvements for the amount of impact.
Consider freshening up your handrails and porch railings – make your house pop from the curb. Repainting the front door and window shutters can be an impression of your house is being maintained.
3. Floors
Consider swapping damaged wood floors with real wood, or a high-quality engineered wood product, rather than a cheap alternative.
Replacing floors can make you like your home more, but it doesn’t provide a major return on the investment. It does, however, make the home more appealing to buyers.
4. Weatherization
Increase your house energy efficiency.
5. Final tip – Local Real Estate Agent/ Realtor
One factor that will have the most influence on every aspect of the home selling experience is the Real Estate or Listing agent. Find a professional with a proven record of success marketing homes in your area that you feel comfortable with and trust. Then, allow your agent to guide you in preparing your home for sale, staging, and pricing – https://dukerealtyhomes.com/.
Courtesy of: https://www.fluxmagazine.com/sell-your-house-or-renovations/
