Selling a Home As-Is vs. Making Repairs: Pros, Cons and Expert Tips
Your home is ready to go on the market, but you need to decide the pros and cons of selling a home as-is vs. making repairs.
The former is a lot easier, less stressful, and doesn’t cost as much money upfront but it can greatly reduce your pool of buyers. The latter will likely get you more money from the sale and will make your property more attractive to more people but it will cost you both time and money.
So, should you spend more time fixing up the interior and exterior or try your luck with selling your home as-is?
Reasons to Sell As-Is
- You cannot afford to make any repairs
- You don’t want to deal with the stress of repairs
- You need to sell your home very quickly and don’t have time for repairs
Reasons to Make Repairs
- People will see your home in a more positive light
- You are less likely to get low-balled on price
- Your home will attract more buyers
Selling Your Home As-Is
Selling a house as-is refers to selling the property in its current state and no repairs will be made.
The seller and buyer must be in complete agreement about the fact that repairs won’t be made and this will be a contract that both parties must sign.
Now, you will likely have to disclose any issues with the home to the buyer it is best to discuss what you have to disclose regarding the state of your home with an experienced real estate agent.
Fewer Fixes Mean That Offers Might Be Lower
Selling your home as-is will result in offers that are lower than you might expect as you haven’t added any value to your home. Or, even if you have made some minor repairs recently, buyers might still send you a low bid simply because the home is listed “as-is.”
In their eyes, they can’t move in right away and want to offset the cost of maintenance by saving cash on the sale.
Severity Of The Fixes Could Reduce Your Buyer Pool
Factoring in how much time repairs take should 100% impact your decision and they can end up costing you quite a bit of money depending on the severity of the problems.
For example, when the repair is something major like a big plumbing or foundation issue, not making the necessary fixes will definitely affect the selling process.
If you do choose to leave these repairs up to the buyer, the cost of those repairs might price out regular people and reduce the buyer pool to those who want to fix-up or flip properties – and they famously don’t pay full price as it eats into their bottom line.
As-Is Does Allow For Better Flexibility
Although adding value to your property is a significant consideration, you also should analyze the trade-off in terms of time and money. Yes, your home might be worth more, but is it going to sell quickly if you make all of those repairs?
The answer is hard to predict. In short, selling as-is normally allows for more flexibility and a smoother, less stressful process for you but not necessarily for the buyer.
If you need to move quickly or do not have the money to make repairs, you will need to work with a real estate agent to ensure your home is priced competitively for your area – this will help you sell your home faster but again, you might not make as much back on your investment as you would if you made repairs.
The Benefits and Risks of Repairs
If you are doing the repairs yourself to help save on costs and are not a seasoned pro, there could be flaws in your work that buyers will see.
For example, more detail-oriented parties might be bothered by cosmetics like a slightly different paint color that was used after filling a nail hole.
When the market is cold, something as simple as the gloss of paint can make a difference as people move through the rest of your home – they will likely be on high alert for other issues and these could ultimately affect their decision to buy.
Now, if you choose to have a professional make updates and repairs, you run the risk of not getting your money back on that investment.
You may also find that you have big, expensive issues that need repairs like foundation cracks or a roof replacement. If you are not selling your home as-is, it will most likely be your responsibility to fix these things before you sell, but they will not actually raise the value of your home because they are seen as maintenance issues.
It is important to note that there is a difference between home improvements and home maintenance. Replacing your old roof does not increase your home’s value; it just makes it more possible to sell your home – if you don’t go the selling as-is route.
The Right Repairs Can Boost Property Value (and Help You Sell Your Home Faster)
Although we’ve talked about how making repairs and upgrades can slow down the sales process, adding to the value to your home with the right upgrades is a smart move if you have the time, but it really depends on factors relating to the people who are interested in your property.
For example, is the area in a desirable location? If the answer is yes, buyers will be willing to pay more to secure a home there and the right upgrades could set your home apart.
Once you have figured out if you’re location is in demand, the next step is to figure out which repairs add the most value. Adding a swimming pool is notoriously pricey and does not necessarily add a ton of value to your home – whereas investing in energy-efficient windows can recoup 90% of the investment.
Repairs Worth Making Before You Sell
There are definitely some easy fixes that you can do yourself to help your home sell faster. These are minor investments for the most part and almost exclusively are related to the aesthetics of your home.
Cluttered bathroom & kitchen
These are two significant rooms in any house: Kitchens and bathrooms. Unclean bathrooms and kitchens are huge turn-offs to most buyers. Thankfully, you probably won’t have to hire someone to spruce up these rooms.
All you need to do is remove clutter, dust, and dirt, and ensure the appliances are functional. Remember that viewers will look in nooks and crannies, so it’s worth cleaning the areas thoroughly.
Painting is something almost anyone can do and can make a huge difference when you are trying to sell your home. Considering a can of paint only costs a couple of dollars and you only need to spend a few hours over the weekend to paint your walls, this is a great upgrade that you can do yourself.
Glossy paint adds shine and light, making the whole house appear brighter, cleaner, and more modern. In terms of color, you should appeal to a broad base and not be overly bold. Neutral shades, such as cream or light grey, are effective.
Don’t solely focus on interiors that are fatigued – concentrate on exteriors, too!
Relatively, the outside of your home is important for two reasons:
- Number one: it’s the first thing buyers see when they drive up.
- Number two: exteriors are generally easy to modify.
Among 22 home improvement projects in the 2019 report, nine out of 10 of the best-returning jobs nationwide involved the exterior of the home.
The trick is to remove clutter from the front garden or yard – you can put it in your shed or dispose of it through city services – and mow the lawn. A shaggy, overgrown yard isn’t a feature of a dream home.
If the paint on the outside of your home is peeling, you may want to look into investing in having it repainted if it truly is an eyesore or try painting it yourself.
Small dark rooms can be a bit of a turn off for buyers but it is fairly easy to make these rooms more inviting.
Natural light is great for making any part of your home appear more inviting, and swapping curtains for blinds is all it takes.
If the sun’s rays are hard to source, you can use a few tricks.
Mirrors are famously useful as they reflect light and make tiny rooms seem bigger. Plus, you can place them strategically to highlight your property’s best features.
If you have small rooms that get zero natural light, add lamps and soft accents like throw pillows and blankets to give those spaces a cozier feel.
What Else Should You Consider?
In essence, repairs are necessary as long as they don’t restrict your ability to sell and can recoup the value they add. But that isn’t the end of the story. To be sure you have chosen the right side of the fence, you should think about the following:
Fixer-Uppers Or Fixed Up?
Some people will want a home that is fully functional and move-in ready.
Others will prefer your property to have potential so that they can create a home that suits their personality and that they can eventually sell for a profit.
All too often, buyers purchase a house and realize it will never fit the image they have in their heads. The key is to target the right base, and, to do that, you must understand their agenda.
With the right data and marketing techniques, a well-seasoned real estate team can help you advertise your property as the perfect fixer-upper or ready to move-in ready home and find the right price.
Home Value Duds
It’s essential to work out which improvements are going to be a hit and which will fall flat. Otherwise, it’s a waste of time and money that you were never going to recoup.
As we said, bathroom, kitchen, and some exterior updates tend to be the wisest investments when upgrading your home. However, some improvements should be avoided because you will waste your time and money on them.
- Extensive landscaping. i.e. water features and gazebos won’t add much to your bottom line and can look gaudy to some buyers.
- Over the top light fixtures. Tastes vary and it isn’t worth spending hundreds on new, funky light fixtures. Opt for more energy-efficient options like LED bulbs and subtle lamps.
- A fully remodeled basement. Although this upgrade seems like a great investment, you run the risk of pricing yourself out of your neighborhood. Use the money for more functional and cost-effective upgrades like adding more storage space in your home.
- Custom design features. Remember, everyone has different tastes and that cool tile or wallpaper you put up might be offputting to some buyers and won’t do much to add value to your home.
Finally, gauge the market. If it’s hot in your area right now, you can probably get away with little to no repairs as there are a greater amount of people willing to make an offer.
If it’s slow, making repairs and taking time to ensure your home is move-in ready is an excellent way to make it more appealing to interested people who need convincing and you will likely get more money for your home.