Wondering How To Sell A House That Needs Major Repairs? Don’t Worry, Our Guide On Selling Old Homes Can Help!
If you are reading this article then you’re probably worried about selling your house which is in need of serious repairs. It could be that your house is outdated, unsafe, nonfunctional, too expensive to keep up, or all of the above. Whatever the case, you’re probably feeling overwhelmed by dollar signs. Renovations are time consuming and expensive, and if you choose to list your house on the market “as is” you might even lose more money because of monthly mortgage payments while your house is on the market.
Whether to choose to renovate or not, if you’re not informed about your options, you’ll likely lose money. In this article we will let you know about your alternatives when it comes to selling a house that needs work. This includes: what to prioritize when renovating, how to pay for renovations, and who to sell to if you decide to sell your house “as is.”
Getting a Return on Your Investment
Once you decide to sell your home, you need to choose which parts need to be updated and/or renovated. To help you get on the right track, here’s a list of the top 15 updates that pay off and the average return on resale.
- Minor Bathroom Remodels: 102%
- Landscaping: 100%
- Minor Kitchen Remodel: 98.5%
- Exterior Improvements: 95.5%
- Attic Bedroom Conversion: 93.3%
- Major Kitchen Remodel: 93.2%
- Deck, Patio or Porch Addition: 90.3%
- Basement Remodel: 90.1%
- Replacement Windows: 89.6%
- Family Room Addition: 83%
- BonusRoomUpdates: 72.8%
- Living Room Updates Decor: 66%
- Bedroom Updates: 52%
- Living Room Updates: Walls, Floors: 40%
How Much Will Renovating My Home Cost?
These are all great options, but the costs vary for each of them. And obviously if any of this work is something you’d be willing to tackle as DIY projects that would decrease the costs as well. However, if time is of the essence, your best bet is to find professionals to take care of it for you.
- Minor Bathroom Remodel – To replace the tub, tile, sink, vanity, floor, and features it will cost around $10,500.
- Landscape – The average amount spent on landscaping with a designer is $5000.
- Minor Kitchen Remodeling – The average minor kitchen remodel costs $15,000. This primarily includes refacing cabinets and drawers, fixtures, laminate countertops, tile flooring, wall oven, cooktop and sink.
- Exterior improvements – This includes your siding, paint and front entry. The average rate in the U.S. to replace vinyl siding is $7,500.
- Average Bedroom Conversion – The average cost for this is $39,500.
- Major Bathroom Remodel – A major bathroom remodel could possibly include relocating water pipes to move a bathtub, sink or toilet; adding a linen closet, new lighting, heated floors, an exhaust fan and more. This type of renovation can cost around $26,000 or more.
- Major Kitchen Remodel – This type of renovation can include an island, granite countertops, stainless steel sink and vent hood, and more. A renovation like this, in a mid-range home, averages around $44,000.
- Deck, Patio or Porch Addition – Adding a simple 16×20 foot wood deck costs around $11,000 to $12,000.
- Replacement Windows – Replacing ten 3×5 windows will cost in the range of $9,000 to $11,000.
- Family Room Addition – If you would like to add a family room addition the average cost is $55,000
- Bonus Room Updates – Converting an extra room into a home office or some other type of space will run around $14,000
- Living Room Updates/Decor – A minor living room update of new light switches, outlet covers, floor registers, crown molding, chair rails, drapes, accessories, and other decor will cost in the range of $1,500 to $2,000.
- Bedroom Updates – Installing wood flooring in a normal size master bedroom will cost (depending in quality) around $2,000 to $3,000 painting will add somewhere between $400 to $900.
- LIving Room Updates, Walls and Floors – A new mantel, wood floors, and painting will be about $3,500
How To Pay for Your Renovations To Sell Your Home Fast
There are different options when it comes to paying for home renovations. The first is cash. Cash is the easiest way to cover home improvement costs. It will keep you from touching the equity in your home, and you won’t have any future payments. But if you are short on cash here are some other ways that can help you renovate your home.
- Refinance Your Mortgage – If you’re planning on refinancing your home loan anyway, this can be a good option. Keep in mind, refinancing can be time consuming and approval will depend on your credit.
- Home Equity Loan – This a great option as interest rates are low but the amount borrowed is determined on the value of your home minus your current mortgage. If your home is in serious disrepair this might not be an option as the value will be diminished.
- Construction Loan – Construction loans are used for large renovations or to build a house. If you need more than the equity of your house, then this is an option. The only issue is that these loans are not easy to come by and there are many requirements that come with them.
- Credit Cards – This can be a good option for small renovations. You may not be able to pay contractors with a credit card, but you can tell your contractor that you want to pay for materials with your credit card. Of course amounts depend on your credit limits and your current balances.
- Borrow from Your 401k – For this type of loan you’ll have to pay back the loan over five years and the payments for the loan will be taken out of your paycheck. The catch with this loan is that if you quit your job, the balance will be due immediately and there are tax implications.
- Reverse Mortgage – If you’re 62 or older, you can get a reverse mortgage. These loans are good for people looking to retire in their home. If you have a large sum of equity in your house or own your home mortgage free, you can basically sell equity back to the bank in exchange for cash. The best part of this loan is that you are not required to pay back the loan until the home is sold or you move. But if you’re looking to sell your home this isn’t a great option.
- FHA Title 1 Loan – Title 1 loans can be up to $25,000, and the terms can be for as long as 20 years. This loan does not require equity in a house. These loans do take time to get and do come with a lot of paperwork. Just make sure you aren’t paying for repairs long after they need to be replaced.
- Contractor Financing – Your contractor may have relationships with certain financiers and can possibly make an arrangement to finance your project, but generally you can get better financing on your own.
No Renovations Needed To Sell Your House Fast
The quickest and easiest way to deal with your renovations is not to deal with them at all. If you’re looking to sell your house quickly, then the best route might be to sell your house with a real estate investor. The only problem with this is that all real estate investors are not created equal. An inexperienced real estate investor or a shark investor can leave you in a last minute jam. The reason is that some companies will give out empty promises of purchasing your house, but in reality, they don’t have the funds to back up their promises. If an investor decides they cannot afford to buy your house, you’ll be left with no buyer and possibly months of extra mortgage payments.
Sell a Property in Need of Repairs to a Reliable Company
With all the options listed above, the decision process of what you want to do can be stressful. If renovations are important to you, and you are willing to keep your house on the market until you sell, then all of our ideas above are viable options. But if you need to sell your home fast, and don’t want to be involved in renovations, then we have a fast and easy solution for you.
If you want to get rid of all the risk, and just sell your home fast, then you owe it to yourself to contact Heart Acquisitions. We are a locally owned company that serves the Lowcountry and beyond. Our team is comprised of members that are a part of the Bluffton/Hilton Head communities. We are not a franchise, but good citizens living amongst our clients.
Here’s what our simple process looks like:
- When you contact our team, we’ll come take a look at your property and give you a fair offer quickly, regardless of its condition.
- Everything will be contained in a written contract.
- You choose your settlement date.
- We don’t rely upon traditional bank financing, and you get your cash in a matter of days.
Cash in Hand Fast
When you sell your home to Heart Acquisitions, you get cash in your hand at settlement. No waiting on bank approvals, lengthy appraisals, or home inspections. You sell your home “as is” for cash giving you the ability to spend it as you see fit. Give us a call today at (843) 227-1918.