How To Sell A House In Poor Condition

Selling a damaged house or selling a house in poor condition sometimes referred to as dilapidated, can feel like an intimidating task. Even small damage to your property like chipped paint, warn floors, or leaking roof can feel discouraging, especially when you are selling a difficult to sell house. Never mind if there are large amounts of damage like after a fire, flood, or storm causing water damage, or even a house with unknown damage like in a hoarder house, you can still sell your house as is. Unfortunately, properties in poor condition like this are not uncommon. 

In fact, according to the National Association of Home Builders (NAHB), the median age of owner-occupied homes in the country is 39 years! After owning that long, it’s easy to find deferred maintenance or neglected repairs. After addressing the repairs needed, finding a buyer with a fair price can feel like the most challenging part of selling your house in bad condition. 

So what are you to do to navigate this sales process successfully, even in the face of physical distress?

In this article, we’ll walk you through the process of selling your home in poor condition– whether you have the budget for extensive repairs or not.

Understanding The Challenges Of How To Sell A House As Is

When you’re first deciding how to sell your poorly conditioned house, it’s important to understand the challenges you face with the different categories your home can be in. There are many different ways to view a house in bad condition and even experts, like an inspector or house flipper, will have different definitions. These challenges can include things like the building structure and foundation damage, compromised electrical or plumbing systems, or severe deterioration of systems like HVAC (Heating Ventilation Air Conditioning) or the roof. Additionally, severe damage from fire, floods, and storms or from something like a hoarder house for sale can require expertise to address.

Is My House In Bad Condition? Selling a house in poor condition…

Minor Repairs – Cosmetic Repairs – Minor Updating Needed

If your home is in this condition, that’s great news! It means the return on your investment into the repair or rehab of your house is great, and the cost is minimal. Now you can do them or hire them out to a handyman and they can be done quickly. Examples include:

• Nail holes in the wall – These are generally from hanging pictures on a wall and can be quickly fixed with spackle and paint. 
• Old, stained, or chipped countertops – Replacing with new stone countertops may be your best bet but is not as costly as you may think. Make sure you check out new design trends to find out what might be best for your countertop colors or designs.
• Chipped, stained, or sagging cabinets – Depending on the condition of the boxes, this can be as easy as replacing the bad doors or having them painted and the hardware replaced. 
• Ugly wallpaper or mismatched painted walls – After a long period of time, most wallpaper is stained and makes the house look old and dated. If you have mismatching paint, now would be the best time to address it and paint the house a neutral color.
• Dirty, ripped, or worn out carpet – Replace it with new carpet or even LVP (Luxury Vinyl Plank) to update the house and make it look more inviting.
• Messy, dead, or overgrown yard – Bad curb appeal is generally easy to address and can be done with pavers or retaining stone, or by just replacing the dead or overgrown landscape with new lively landscape. 
• Outdated fixtures – Updating from halogen or even CFL to new LED lights can not only improve the look but can improve your electric bill.

Another easy way to address this is to contact a staging professional or real estate agent to help point out updates that may help. Addressing easy things will not only make the house easier to sell, but they can easily raise the value of the home for potential buyers. 

Major Repair – Major Updates – Broken Mechanicals

Homes in this condition generally will need some extra repairs and will likely even need a specialist to help manage the repairs. They may even teeter on the verge of uninhabitability due to the significance of the repairs needed. If you don’t have experience fixing these things, it will be best to have hired a professional. These issues can include:

• Broken or inefficient HVAC – A heating, venting, and air conditioning issue can be costly but if maintenance hasn’t been performed and small repairs have ballooned into bigger repairs, it may just be best to replace the system. Newer systems are a lot more energy efficient and can really attract buyers who don’t want to worry about replacing larger mechanicals like that in the near future. 
• Damaged roof – A damaged roof still functions but based on the defects of it from things like storms and the sun, it may need to have a hole patched or some parts replaced to ensure it weathers future hazards. If the house can support the weight of a new layer of shingles, this might be the most efficient way to repair the roof.
• Minor foundation issues – This can be seen from things like cracks in the house or brickwork and pooling water in your basement. Generally, these repairs will need to have the cracks in the foundation fixed or even tuckpointing. This will definitely need professional repairs.
• Outdated kitchen or bathroom – When a bathroom or kitchen can’t be restored with minor repairs, a gut rehab of it may be the way to go. Not only will you find new efficient water flow systems, like faucets and toilets, but you’ll be able to update the fixtures to improve monthly utility bills.
• Warn or damaged electrical or plumbing systems – If you have plumbing issues like slow drainage or trouble flushing a toilet, you could need to have an updated plumbing system running to the village drainage repaired. If you’re seeing electrical issues like fuses popping or lights flickering, you could have an issue with wiring or circuit problems that will need an electrician to look at the needed repairs.

When addressing issues like these, having a specialist to help may be very useful. These repairs can be dangerous, expensive, or require expertise and experience to deal with. Consider repairs that you have to have a specialist or have extensive cost to mean your home fits in this category.

Dilapidated Home – Poor Conditioned House – Uninhabitable House

Before addressing a house in this condition, there is much to consider. Selling a house in this condition, even if trying to sell an inherited house, can require lots of work and lots of special expertise to get the home up to proper code. Building codes in each area can vary, and the most important thing is that most building code is to ensure the safety of the structure and the inhabitants that live there. So knowing the condition of your property, you really have 3 options on how to sell your house. The first 2 options do require some upfront investment. 

First Option – Do The Rehab And Invest In The Repairs Before Listing On The Local Real Estate Market (MLS or FSBO)

If the house is uninhabitable or needs major repairs, you really have 2 minor options here, you can rehab the property to at least make it habitable and ensure loans can be made on the property or you can completely renovate to get the best return on the property, for example selling a fire damaged home. The good news is that you’re ready to list your home on the open market, using a listing agent to list your property will most likely save you time and energy. Before making that decision, you have to keep in mind that buyers generally want the property to be almost turnkey if they’re going to give you a higher price and that if it is just habitable, you’re still trading some of your equity to sell to the property. 

No matter which way you choose, making major repairs can be costly. We’ve given you some national averages of costs here:

• Remodeling a primary bathroom – $2,400 to $25,000+ with an average cost of $125/square foot 
• Kitchen remodel – $14,549 to $40,025 with lots of variances depending on where you live
• Replace HVAC – No ductwork needed: $5,000 to $11,000 and if ductwork is needed: $7,000 to $16,000
• Replace water heater – $810 to $1,656 with a national average of $1,217
• Total roof replacement – $6,700 to $80,000 with an average cost of $11,500 to an average-sized home
• Mold remediation – $1,500 to $9,000 with an average cost of $3,500
• Pest control – Depending on pest type, this could range from $100 to $5000, with termite treatment ranging from $230 to $940

Second Option – Make Cosmetic Repairs

A lot of times, if your property is in this condition, you may be able to make the repairs yourself. Things like repairing nail holes in walls or replacing a leaky faucet are easier fixes most homeowners can generally undertake. To ensure the best work is done, you may want to hire a professional to undertake the repairs. This can include things like landscaping and painting. Well not too costly, there is still an expense. These will usually give you the best return on your investment. Examples costs of these are:

• Painting a house – Average cost is $2 to $6 per square foot, with the national average of $3.50. To determine the average cost of your home, just multiply by the square footage of the home or room you’d like painted.  
• Landscaping – Average costs range from $2,600 to $13,700 with an average of $8,150. This can vary depending on what you’d like done to boost curb appeal.
• Replace fixtures – The average costs here range from $100 to $1,700 per fixture and are usually charged per hour. If you’re replacing light fixtures and fans, you might as well replace the switches too.

As you can see, with the first two options, repair or rehab costs can easily get into the thousands and take lots of time to complete. This takes away from your potential return. Before embarking on this route, you should ensure your After Repair Value (ARV) from your local agent to make sure the return on your costs may be worth the time and effort. Also, keep in mind that an agent can also help you determine needed repairs vs extra repairs and let you compare what repairs will help give you the greatest return. 

The good news is that you’re ready to list your home on the open market. Choosing to list your property with an agent will most likely save you time and energy. But it does come with a cost. You will be paying the agent’s commission and generally the commission of the buying agent as well. This will be subtracted from your profit from the sale of your home. Does an agent managing the staging, showings, negotiations, and the sale through the close of escrow worth the cost after all the effort you have put in?

There is also the option of selling For Sale By Owner (FSBO) and you’ll save on the commissions you’ll need to give to an agent but by taking control of the whole sales process, you do expend that energy and time to manage all of those things that agents have systems for. This may net you the most earnings from the sale of your property.

Third Option – Sell As Is To Cash Buyer

Selling your house as is to a cash buyer can provide you with an easy and convenient solution that can save you more time and energy than tackling the repairs yourself. However, it’s essential to understand that you are accepting a discounted offer and trading equity for convenience, as cash buyers assume all the risk and expenses associated with making the repairs to the property. This means you’re selling your property below market value.

In situations where your house is uninhabitable and major repairs are beyond your financial means, selling as is may be your only viable option. Traditional retail buyers will often struggle to secure a loan to finance the purchase of a dilapidated property. This generally makes a cash buyer a more suitable choice.

When selling to a cash buyer, they will generally rehab the property and sell it (also known as flipping) or they will rent the property out (known as holding). The extra benefits of selling your home as is, you can skip the processes of inspections, repairs, appraisals, and even staging, thereby avoiding all the hassle of listing it on the open market. Because they avoid all these things, they can also close faster and avoid mortgage lending and traditional financing. Most will even pay your closing costs. 

Even in a situation where you have tax liens, encumbrances, or other financial obligations (secondary liens), a cash buyer can still buy your property. They will handle these financial situations to close swiftly and avoid any other additional costs.

As you can see, selling to a cash-in-hand cash buyer can create a win-win situation for all parties. You can sell your property quickly and efficiently, saving you time and energy, while the cash buyer obtains a new property with potential future profits.

5 Tips For Selling Your House In Poor Condition – How To Sell A Dilapidated House

Selling my house in poor condition can be challenging, but as you can see, with the right approach, it can be done with some effort. To attract buyers that will lead to a successful sale, here are 5 tips to get the job done:

1. Be Prepared

Talk to an agent or even have an inspection done. By knowing the condition of your home and what the return on your investment is from the repairs, you can be well prepared for the outcome. This will also help you further down the line when selling your home on the open market and it will say to a buyer that it isn’t a house in bad condition for sale.

2. Accentuate The Positives

Highlight features such as the square footage of your home, lot size, location, proximity to popular amenities, architectural style, and the number of rooms, especially bedrooms, and bathrooms. By focusing on these positives, and possibly even rare features seen in the area, you can create a more enticing image and make your home more wanted.

3. Undertake Minor Repairs

Major repairs may be too costly, but by completing minor repairs and focusing on cosmetic improvements, you can improve the image of your house. Doing minor exterior improvements can also boost curb appeal, making your home more inviting. Taking on simple tasks that you can handle yourself, such as replacing an outdated light fixture or ceiling fan, improving basic landscaping by adding new flowers, or even giving the house a fresh coat of paint can improve the appearance of your home. These small improvements can make a big difference in attracting buyers and creating a more positive image.

4. Disclose Major Issues

Being transparent and honest is key when selling a house in bad condition. Be upfront about all known issues, even if you live in a caveat emptor state where buyers are responsible for their own due diligence. Disclosing problems fosters goodwill and ensures that buyers have a clear understanding of the property they are trying to purchase. It will also protect you from all future potential legal complications that may arise. 

This is where hiring an inspector may come in handy. The provided inspection report will identify material defects and may uncover additional issues you may have missed. An example may be signs of termites, but by taking this proactive step, you can inform and even address problems that come up before the buyer’s inspection. It will help you avoid surprises that could weaken your future negotiation position.

5. Be Ready To Compensate Buyers And Make Price Concessions

When selling a house in poor condition, it’s important to anticipate the market value may still be impacted. Things like structural damage from a termite infestation, severe foundation issues, or the presence of asbestos can significantly lower the property’s value. Mentally prepare yourself for potential concessions that buyers may request, such as repair credits at closing or a significant discount from market value to sell the property. 

Remember that the burden of repairs will lie with the buyer and you can be ready to show willingness to negotiate or facilitate the sale of the property. To make the property and the sale more attractive, you can obtain quotes from reputable contractors for the necessary repairs. You can then provide these quotes to the buyers, showing them the realistic expected costs of repairs. By being willing to negotiate and showing your awareness of the needed repairs, you show your realistic knowledge of the condition of the property and your want to expedite the sales process.

Conclusion – Selling My House In Poor Condition

Selling a property in poor condition can be a daunting task. Whether it’s due to extensive repairs, neglected maintenance, or unique challenges like a hoarding situation, or you may want to save your home from foreclosure, finding the right buyer may seem challenging. However, there are effective strategies to navigate the sale and successfully market a house in need of TLC.

Hopefully, this has provided you a better understanding of not only the condition of your house but the efforts needed to sell it. By making the needed major repairs and listing it with an agent to sell will ensure you a higher price, but not necessarily a greater profit. Only you can decide if it is worth the extra time and energy to improve the property.

Nonetheless, selling a house in poor condition or dilapidated doesn’t need to be complicated. You can sell it as-is to a cash buyer in days vs weeks and take the hassle out of selling. We can make it that easy for you. At SILT Real Estate and Investments, LLC, we are cash buyers for all kinds of property – even those in poor condition. We want to buy your home regardless of the condition or the problems. And we cover all the closing costs and there’s never any commissions or hidden fees for selling a house like some cash buyers.

Just fill out the form below so we can get started on buying your house in poor condition. Or if you have questions or just want to talk, give us a call at (708) 415-3801. We would love to hear from you!