What Minimal Repairs to Make Before Selling Your house In Poor Condition

Make Basic Repairs before Selling an As-Is Home

2018 is already on a remodeling high. The Residential Remodeling Index was up 5.2 percent this spring over last year, and it’s predicted to grow 5 percent over the coming year.

At least some of those remodels will come from people fixing up their houses to sell. If you’re moving for work, retiring, or upsizing, you’ll probably be selling your home in its best condition in order to get a good price for making a sizeable down-payment on your next home.

If you’re downsizing in order to better manage mortgage costs, you probably won’t have a lot of time or money to invest. In this case, you may look at it as selling an as-is home.

Making a few repairs is a good idea in both cases.

Without making a few basic home repairs, it can be difficult to attract buyers, and you might only get low offers from people looking to flip the home.  No one wants to buy something that looks like it’s going to be a money pit, even if they’re willing to invest a little money and elbow-grease themselves.

Why minimal repairs count when selling an as-is home

Small cosmetic fixes can make the home welcoming. Basic repairs increase safety levels in the home and allow them to pass loan inspections. Some repairs also boost home assessments, which can also help lower-end home buyers to get the loans they need.

Make it appealing

Even a fixer-upper should be as welcoming as you can make it. Sometimes a fresh coat of paint or new window coverings can make all the difference. If you don’t have time to paint, at least get the home as clean as you can. Shampoo the carpets, clean the drapes, scrub the floors and wash the windows.

Help the home pass building code inspections

In some as-is homes, repairs are needed for safety reasons. Basement bedroom windows may need to be enlarged and lowered in case of fires. Faulty wiring may need to be replaced, and water leaks may need to be found and eliminated.

Without these minimal repairs, the home might not pass inspection, and potential buyers might walk away.

Boost the home’s assessment value

Replacing a broken dishwasher or garbage disposal may require a little more time and money than you’d like, but if it boosts the assessment value of the home, it might be worth it. If the assessment value makes the home a good deal, buyers will take it more seriously, and banks will be able to fund the loans.

Planning Ahead for Minimal Repairs

One of the first questions you’ll need to ask yourself is whether to hire help to take care of the most basic repairs or to take care of them yourself. Hiring a contractor might speed up the process, but it will also shoot up your investment costs and can cause some upheaval for families still living in the home.

You’ll also need to list all of the repairs that need to be made and prioritize them. In an as-is home, the goal isn’t to make every repair but to make the most essential ones so that the house will sell quickly.

If a home is sold quickly after renovations are finished, the seller might get back about 65 percent of the cost of the repairs.

Six common cosmetic fixes to consider

As you try to make the home more welcoming without spending a lot of money, take the following considerations into account:

• Kitchen upgrades—common kitchen remodeling costs range from $4,500 to $49,000 and beyond. For an as-is home, you can probably get by on a lot less. You might only paint the existing cabinets and fix broken hinges on the cupboards or pantry doors. Further cosmetic upgrades may have a low return on investment.
• Bathroom repairs—again, you’ll want to make sure the doors work. Replace the doorknob if the lock doesn’t work. Consider upgrading the hardware on the bathroom cabinets, re-grout tiles, and replace any cracked or broken mirrors. National averages for a bathroom remodel range from $6,000-$14,000, but again, you can probably get away with a lot less investment if you’re selling an as-is home.
• Replacing carpet—in many as-is homes, this might not be an issue. If, however, you’re attracting buyers who want to live in the home right away, having huge rips or stains in the living room carpet is likely to drive them away. Consider the people you expect to be interested in the home and plan your carpet investments around them.
• Fix holes—repair holes in the walls and interior doors and patch ceiling cracks. Check the corners and repair spots where the angle iron is showing through. Put doorstops behind the doors and paint the walls in light, neutral colors.
• Take a look at the light fixtures and outlets—replace dingy outlet and light switch plate covers with new ones. Switch out old light fixtures, but don’t go overboard. Plain and simple is your best bet for saving money and attracting buyers.
• Don’t forget the yard—but keep it simple, too. Pull the weeds and mow the lawn. Beyond that, make sure any fences are in good order and that the yard is free of debris.

Seven inspection-related repairs

95 percent of purchased homes go through a home inspection, which some fixer-uppers won’t pass. That’s not a problem if your buyer intends to flip the home or is a contractor. However, a family looking for a decent home might not be able to proceed if the house doesn’t pass inspection.

Here are some basic repairs to consider so that your home can pass inspection and sell as quickly as possible:

• Structural defects—this can range from normal settling of a house to damage caused by destructive pests, such as termites or carpenter ants. Pay for exterminators if you need to, and have any cracks in the foundation repaired.
• Address moisture and mold issues—get rid of moisture anywhere it collects and repair the causes behind it if you can right away. Sometimes an entire roof might be the trouble. Other times it’s a leaky pipe, a window that’s not set in well. Consider renting or buying a dehumidifier to help dry out walls, ceilings and attics while you make the necessary repairs, and get rid of mold everywhere you find it. Install fans in the bathroom. Check for leaks in your air conditioning system and repair them if you can.
• Check the wiring—Some as-is houses have wiring issues, including lights that flicker, heaters or bathroom fans that don’t work, or switches that don’t seem to connect to anything. Faulty wiring is estimated to cause 67,800 fires a year and $868 million in property losses per year, so making electrical repairs can be a big deal. Go through the house and make a note of anything unusual or dangerous. Repair what you can, and consider hiring an electrician for tasks beyond your skill set.
• Check the plumbing—replace any leaky faucets. Check to make sure all pipes are draining well and that there isn’t rust coming through any of them when the water is turned on.
• Fix broken windows—this could include replacing broken glass or an entire window if it’s one that moisture is seeping through. For homes with basements, measure the windows and make sure they are up to code in case of home fires.
• If the home has a fireplace or wood-burning stove, have the chimney swept and make sure that it isn’t a fire hazard. Cleaning out the creosote can reduce the risk of chimney fire. Chimney maintenance that includes sweeping and inspection may run around $298.
• Likewise, check gas lines and propane tanks to make sure everything is in good working order. Have the furnace and water heater looked at to make sure there aren’t any danger issues there?

Adding value to increase a home’s assessment

Making repairs to a home to increase its value right before you sell it probably won’t provide a good return on investment. There are a few exceptions, such as minor kitchen and bathroom upgrades.

The amount and types of appliances the home has can add to a home’s value. It might help to replace a broken garbage disposal, dishwasher, or garage door opener, but weigh the costs with the value you expect to see.

Other repair work might include replacing cracked boards on a deck, fixing a garden shed door, or installing an AC system. Again, don’t get too carried away at this point. Just do what you can and stay within your budget.

Paying for repairs

Figuring out a way to fund the most necessary repairs can be difficult, especially if you’re selling an as-is home in order to get your housing payments and other debts under control. Before you get started on any of the repairs, prioritize them and make a budget.

You might be able to get a home equity loan or personal loan from a bank. If you go through a contractor, they might carry a loan for you, but that could be expensive.

One possibility is the idea of rolling repair costs into the home loan when someone decides to buy it. In this case, you’ll only make the repairs that the buyer wants you to make, and you’ll add the costs of those repairs to the total loan amount.

If you’re trying to save money, doing all the repair work that you can is a good idea. You might be able to get good deals on windows, doors, light fixtures and other items you have to replace at a Habitat for Humanity ReStore or through local classified ads.

However, there are times when hiring a professional—such as an electrician or plumber or even a handyman—can save you time and money. Weigh the costs against your skill set and the return on investment you could get when your house sells.

Conclusion

Remember, not every repair that you put on your list will need to be made before you can sell the home. If it’s in rough shape, it might sell at a lower price to someone who flips homes for a living.

However, if families are looking for a perfect home to buy, the more you can do to make your house move-in ready, the easier it will be to sell. In this case, investing a little more up-front money to help a home pass inspection and look nice for the new owners might be worth it.

Do make sure that you disclose all the issues with the house. Include repairs that you don’t make as well as problems with mice and other pests and what the neighborhood culture is like.