So, the house is not in “Like New” condition and is not as cosmetically pleasing as you’d like. Is it worth the time and money to fix it up before selling it? Maybe or maybe not.
When deciding whether or not to sell a home in “As Is” condition it is important to look at the ultimate goal. Many sellers simply want to get out form underneath a home. The price they get for the home is not as important as the selling of the home. Other sellers want to make a profit, by selling it for more than they purchased it for. And still others need to get a certain price for the home to cover their debt in the home. While there may be other situations, these are the three basic scenarios.
When looking at selling a house the pros and cons of selling “As Is” are really very simple. The basic concepts involve selling price, ability to sell quickly, and amount of effort put in. Of course, you have to weigh the need for a quick sale over the need for a specific price when considering this option. We’ll look at the pros and cons from these two standpoints; needing to get rid of the house (Quick Sale) and needing to get a certain price (Specific Price.)
When you are looking to get rid of a house, for whatever reason, you probably are not as concerned with the price. Although you will want to get a fair price, the amount is less important than the fact that it sells. Selling a home as is, in this situation, is actually a bit ironic. You probably have the money to do the repairs to get it in top shape but do not have the desire, or need, to do it.
In this situation you do not want to put much money into selling the home because you are simply looking to get rid of it. Wasting time and money on repairs for a little higher selling price is not a priority. Because you are willing to entertain reasonable offers, you will probably be able to make a quick sale. You might attract investment buyers who want to buy the property cheaper, fix it up, and turn it around for a profit. By selling “As Is” you are not implying anything and are offering no guarantees, either. The homebuyer knows that they are getting a property that will probably require some work.
Obviously, the sale price will be a little lower than it could be with some repairs. Many banks are less willing to offer financing to buyers who are looking at “As Is” properties, unless they have a good plan in place. If you don’t attract the investors you might be spending a lot of time talking to, and showing the property to, people with little hope of financing. You stand the chance of unhappy homebuyers, even though they were told it was in “As Is” condition. Many people expect a house to be a particular way, no matter what.
Whether you bought the property to turn a profit or you need to get out of the debt on the property, you may need to sell the house for a specific price. This is a little tougher when selling “As Is.” But, selling the property in the current condition may be the only option; due to economic situations, health conditions, etc.
If the price you need to get is low you can easily sell a house as is and make a quick sale. Many people are looking for “Fixer Upper” properties. They are willing to buy low, repair, and sell high. There is not a lot of cost, or time, involved in getting the home ready for selling. You can put your money into the down payment of a new place or into other needed areas. The money saved by not doing the repairs may offset the lower selling price.
You stand a chance of not getting the price you desire, or need, or holding on to the property for a long time, meaning continued debt for you. If you are not in an area with a lot of real estate investors looking to “Flip” a property you may have a hard time selling. Banks are usually harder on first time homebuyers and people with less-than-perfect credit when they are looking at an “As Is” home. The bank does not want to get stuck with a home that needs a lot of repairs, should they have to foreclose.
So, when looking at whether or not to sell a house “As Is”, you need to consider whether or not you can afford to hold onto the property, or sell it for a lower price. The savings realized by skipping the repairs may offset the lower sale price.