Making Repairs Before A Home Sale
What do you do if you need to put your house up for sale but you know that it is not in the best shape. Do you sell the house as is? Or should you make repairs first? Figuring this out will have a big effect on the price of your property.
Here are a few examples that can help you clear up this issue:
How heavy is the damage?
There are two main types of damage when selling your home. The first type of damage is cosmetic issues. Cosmetic issues are fixes that do not affect the structure or the overall livability of the property, but it does affect its appearance and is an annoyance to those living in the home. Such cosmetic damage includes leaking faucets, torn wallpaper, dirty areas such as the bathtub or sink, or dilapidated fencing. Even easily fixable small structural defects may fall into this category such as missing shingles or holes in the wall. The important thing to note is that they are relatively inexpensive to fix and if these are the only repair problems, a homeowner is better off fixing these issues instead of selling as is.
The second, and more severe, type of damage is structural. These types of damage can sometimes be so severe that the house is unlivable. Things like broken pipes, electrical wiring issues, HVAC going out, and water and mold issues will all fit into this category. Any one of these things can be a thousand, to many thousands, of dollars to fix and it will have a huge impact on the price of the house.
When you should fix the property?
When a house is generally in good condition but requires cosmetic repairs to spruce it up, a homeowner will receive the greatest return by fixing those issues. If such issues such as a dirty bathtub or a broken fixture are left un-repaired, home buyers will assume that the homeowner has not cared for the property and there could be larger, hidden structural problems that are not necessarily within sight. During the negotiation process, the buyer will point to these blemishes in order to bring down the price, thinking about the cost of these repairs as well as the time and labor to do them. Thus, it is better if the homeowner does the repairs in order to show a pristine home that is move-in ready since it will command a greater price among buyers.
In some cases it is still best to fix a structural problem before you list the house but that will depend on a few factors. The first one is who is your ideal buyer. If you are going after buyers that will only have the money to make a down payment they are not going to be able to afford to fix up the house after they buy so if they have to make repairs like these they are probably going to look elsewhere for another house that is in move-in-ready. These types of buyers will like having a move-in-ready house because that way they don’t have to figure out a way to afford to fix up any defects with the house. Second most buyers do not know the cost of repairs and will normally overestimate the cost. If the damage will cost you less to fix then what someone is going to think it cost then it is best to go ahead and fix it before you list. As an example, if you have a septic problem you are probably going to overwhelm a buyer that is looking at your property and knows nothing about fixing a septic system.