Thinking about selling your home for cash?
While you may be in a hurry to sell, we suspect getting a good deal is imperative.
Rightfully so.
But like most people, you’re probably unsure of how to determine whether or not the cash offer you receive actually makes sense.
Not to worry, we’ll show you what you need to look at.
But before we talk about what you should look at, let’s first talk about what you shouldn’t look at.
Things You Shouldn’t Look At
Real Estate Listing Sites
Price estimates vary greatly on sites like Zillow and Trulia and tend to be inaccurate, so it’s best to skip them.
Properties That Are Currently for Sale
There’s typically a big difference between the price of properties currently for sale and what properties in your area actually sold for. Control the urge to look at current listings.
Houses That Aren’t Actually Like Yours
If you’re looking at homes that took five or more years to build (while yours took a year), or have upgrades like a wine cellar, custom pool, or large basement that your home doesn’t, they’re probably not the best comparison for determining the value of your home.
You also don’t want to look at houses that vary more than 200 square feet in size from yours or are more than a mile away (as a general rule).
Homes That Sold More Than Six Months Ago
Markets fluctuate, so what a similar house sold for seven months ago may be at a drastically different price now.
What You Should Look At
An Accurate Comp
Find a house that’s as close to being like yours as possible within a mile that SOLD within the last six months. That will give you a pretty good idea at what yours should be priced at.
What You’re Likely to Net
While your house may be priced at say $250,000, that’s probably not what you’ll pocket. To get an accurate picture of what you’re likely to net (the amount remaining after expenses and fees), assess the scope of repairs and updates, and then determine what they might cost. Repairs are not a place to cut corners (inspectors will catch it), so make sure you look at pricing from reputable contractors.
You’ll also want to factor in things like staging and landscaping costs, closing costs, and the 6% commission the real estate agent would get if you were selling the traditional route.
Holding Costs
When you sell a home through a real estate agent it typically takes three months to a year. So you definitely want to consider the cost of holding onto the property.
Take a good look at your mortgage, property taxes, insurance, maintenance costs, and utility bills when assessing a cash offer.
Does The Offer Come with More Than Monetary Value?
Besides the fact that cash buyers can often offer you close to what you would net if you sold your home through a real estate agent, they can also help you solve problems, making the cash price they offer all the sweeter.
If you need to quickly relocate for a job transfer or want to avoid foreclosure, being able to close in as quick as seven days, which is what most cash buyers can offer, might be a real life saver.
The cash buyer may also be able to do things like buy your property with your terrible tenants in place (so you no longer have to deal with the problem).
They’re also able to close when you want to (so if you need to hold off a little, that’s okay) and are flexible on the move-out date, which could be really helpful depending on your situation.
You’ll want to think carefully about the kind of value the extra perks they offer might have for you.
If you look at all the right things we mentioned above, and skip the things you shouldn’t look at, you should be well-equipped to recognize whether the cash offer you get is a good one.
Want to compare a cash offer you received with ours? Fill out the form below and we’ll get back to you quickly.