The Common Seller Struggle: Should You Renovate Your Home Before Selling It, Or Leave and Price It As-Is?

The-Money-Pit-house

Many homeowners wonder whether or not they should do perform work to their homes before selling. They hear so much about how certain renovations or touchups reap monetary rewards when it comes time to list the house. What many homeowners don’t realize is that just because you are adding to the house, doesn’t mean it will make you more money when you sell it. Here are some mistakes that many homeowners generally make:

Aesthetics: You should always remember to do the basics, such as make sure the lawn is manicured, or at the very least, presentable. Houses almost always look better when furnished than when empty, and they also look much bigger. If you are moving to another house and plan to take your furnishings with you, go ahead and try if possible, to arrange showings of the home to be done while you are still occupying it. See: Renovating Before Selling; is it Worth it? – HGTV. However, if your house also has structural defects that are frightfully expensive to finish, you might decide to leave it.

Structural Problems: It is practically impossible to buy a house that has no flaws. Every home has them, and will affect the price a buyer is willing to pay, depending on each situation. It is a mistake to think that a potential buyer will assume that the only defects that exist are those that are visible.

They will bring in an inspector, which is why you should have the home inspected first, so that you are aware of any problems before they are. It will either give you a chance to fix it without them knowing, or, be able to let them know beforehand so they don’t think you lied.

When To Fix: There are some instances in which you should fix up before the sale. A example is where is a large variance in the cost of the fix-up, and a potential buyer is likely to over-estimate the cost. Read: Should You Renovate Before Listing? – US News. Another example is where most potential buyers can only afford a small down payment and aren’t in a position to pay for major repairs. By making the repairs before sale while setting a correspondingly higher price, a buyer is in effect financing the improvement in the mortgage. If a buyer with limited cash had to make the improvements after purchase, the financing costs would be substantially higher.

When to Leave “As-is” When the buyer has the financial ability to pay for all needed improvements. Other cases include situations in which the thing that needs fixing up, is something that the buyer would want specific to their taste, and would have un-done anything you had done anyway. 

Sellers Should Request Their Own Inspection: If a house has significant defects, the smart seller will order her own inspection, and in some cases, solicit estimates of the cost of required fix-ups. This will help in deciding whether the best arrangement is pre-sale fix-up, sale as is, or some combination of the two.

In addition, a seller-ordered inspection will tend to equalize the negotiating power of the two parties. For more information: The Latest Info on Renovating Your Home to Sell – Houzz. Generally, if there is something wrong with the house, the buyer is going to try to drastically drive down the price. Buyer-ordered inspections are designed, consciously or unconsciously, to provide bargaining ammunition for the buyer by exposing everything that is wrong or might go wrong.

 

2 comments on The Common Seller Struggle: Should You Renovate Your Home Before Selling It, Or Leave and Price It As-Is?

  1. to anyone reading this article, PLEASE get your own inspection if you’re selling the home. You don’t want the buyer to find out about a problem before you do. We were selling our home, and didn’t know that there was a lot of termite damage on one side of the house. The buyer lowered their offer to where they may as well have stolen our house. We ended up (obviously) passing on their offer, fixing the termite damage, and re-listing. After that, we ended up getting what we wanted. But it was not a fun process, and it took a while to get the house sold.

Leave a Reply

Your email address will not be published.