Reasonable to sell a house that needs some work?

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Reasonable to sell a house that needs some work?

Postby Jfet » Mon Jun 03, 2013 6:21 pm

The housing market around here isn't great. It is *ok* but houses are not flying off the shelves so to speak.

Our house on the river has a great lot (about 2/3 acre low bank in a prime salmon/steelhead fishing spot) but needs some TLC.

Some things are minor (deck needs restaining, carpets need replacing) but other things are a bit more expensive (large room we started remodeling needs finishing, house needs painting, roof needs work).

My guestimate is fixed up we could probably sell the house for $400,000 but it would be on the market for about a year at that price.

I am thinking we could find a buyer very fast at around $300,000 even if we sold it as-is.

Fixing everything would probably cost around $75,000 plus sales tax, so about $82,000. Commission @ 7% on $100,000 is $7,000.

So as a guess, we could sell the house as-is with no sweat put into it and get $279,000 after commission or we could spend a lot of money, time and try to sell it for $400,000 and get $290,000 after deducting repair costs and commission.

We want to put it on the market in spring 2014 and we have to sell it by summer 2015 at the absolute latest. What would you do?
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Re: Reasonable to sell a house that needs some work?

Postby hicabob » Mon Jun 03, 2013 6:27 pm

Which river? - in WA I assume? I want a fixer-upper house on a river in a tax-free state! :happy
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Re: Reasonable to sell a house that needs some work?

Postby Cherokee8215 » Mon Jun 03, 2013 6:45 pm

If the repairs will really cost that much, I'd go for the quicker as-is sale, if there is good evidence (local comps) suggesting that it will play out that way. Many buyers prefer to do the cosmetic fixes to their own tastes, and there is always the do-it-yourselfer looking for a project. With that tight a spread between the "before + repair costs" price and the "completed" price, any serious overruns in the repair costs will make you sorry real fast for wasting the time and money.

I'd just focus on making sure that it is clean, tidy, and presentable to buyers, even if physically a bit rough around the edges.
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Re: Reasonable to sell a house that needs some work?

Postby In The Weeds » Mon Jun 03, 2013 10:45 pm

The problem I see with "fixing it up" before you sell is you have to find a buyer that likes what you have done to the house...other hand is you have to find a buyer that can see the potential in buying a house that needs work.

I will be facing the same problem in a year or so...I'm leaning to sell as is.
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Re: Reasonable to sell a house that needs some work?

Postby Rodc » Tue Jun 04, 2013 9:04 am

If as you stated, the extra $10K comes with some risk that you will spend a lot of money and in fact not realize a benefit.

Off hand this must be some special situation where there are only a few special buyers, otherwise a year is way to long. If you wait that long you have simply overpriced the property and that bring additional risks such as having the property gain a poor reputation leading to a much lower eventual price as well as additional carrying costs that are not recouped (taxes and repairs).

Not really understanding the details, why not price it for a somewhat quicker sale and see what happens. If you get no decent offers in 6 months, do some or all of the repairs, increase the price and try again.

One thing though is that in at least some markets, almost no one wants a fixer upper as they simply do not have the time to be bothered with getting the work done themselves (or lack the skills to even hire someone to do the repairs).
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Re: Reasonable to sell a house that needs some work?

Postby YttriumNitrate » Tue Jun 04, 2013 9:29 am

Jfet wrote:I am thinking we could find a buyer very fast at around $300,000 even if we sold it as-is.
Fixing everything would probably cost around $75,000 plus sales tax, so about $82,000. Commission @ 7% on $100,000 is $7,000.


What about fixing just some of the things? I'd go for the low hanging fruit first. For example, a new coat of paint is relatively cheap and returns a lot of bang for your buck.
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Re: Reasonable to sell a house that needs some work?

Postby NateH » Tue Jun 04, 2013 10:09 am

People sell houses all the time that have roofs or decks that need maintenance or need fresh exterior paint. As long as you disclose the issues, this isn't unreasonable at all.

IMO, you may be optimistic in assuming you will quickly find a buyer who wants your half-finished project.
It won't count as "finished square feet" when you list, so the comps the BUYER will be looking at are going to be smaller houses, which may make it difficult for you to reach a deal.

Plus, if a buyer is stretching to buy your house (most are), they will be unlikely to have the 75k to finish your project and won't want the headache.

I'm curious what is outstanding for this remodeling project if it will still cost 75k to finish. Is there a way to spend 35k-50k and finish it with lower cost appointments that can be replaced by the buyer in the future?
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Re: Reasonable to sell a house that needs some work?

Postby Jfet » Tue Jun 04, 2013 10:14 am

It is a case of having a big house on a nice piece of property in an area of smaller homes. We have the best lot in our subdivision (one of only 4 on the river and ours is the largest). When home price sales are compared in the area, our house would look expensive at $400,000 but quite reasonable at $300,000. Appraisers don't seem to take into account things like carpet, paint, deck stain, even though these things cost time and money.

The replacement cost of our house is estimated at $550,000 through my insurance agent.

I am definately NOT interested in having the house on the market for one year, and it seems like putting significant money into a house we must sell no matter what in 2 years is a very big market risk. To me that would be like spending $80,000 on an individual stock when you need that money in two years.

I guess I have kind of answered the question myself :-)
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Re: Reasonable to sell a house that needs some work?

Postby cheesepep » Tue Jun 04, 2013 10:17 am

If I were to sell a house that required work, I would only do the most basic of repairs (painting, basic plumbing, etc) and cleaning, and sell it with a big AS IS warning.
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Re: Reasonable to sell a house that needs some work?

Postby YttriumNitrate » Tue Jun 04, 2013 10:26 am

Jfet wrote:The replacement cost of our house is estimated at $550,000 through my insurance agent.


Be careful in thinking replacement cost has much of a relation to the market value of a house.
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Re: Reasonable to sell a house that needs some work?

Postby Jfet » Tue Jun 04, 2013 10:35 am

YttriumNitrate wrote:
Jfet wrote:The replacement cost of our house is estimated at $550,000 through my insurance agent.


Be careful in thinking replacement cost has much of a relation to the market value of a house.



no no no, that was not what I meant. I mean the replacement cost shows the high cost of materials and labor.

A replacement cost significantly above the market value for a house in your area might mean it is better to sell as-is than to spend money and not get a return.
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Re: Reasonable to sell a house that needs some work?

Postby NateH » Tue Jun 04, 2013 10:39 am

Jfet wrote:It is a case of having a big house on a nice piece of property in an area of smaller homes. We have the best lot in our subdivision (one of only 4 on the river and ours is the largest). When home price sales are compared in the area, our house would look expensive at $400,000 but quite reasonable at $300,000.

If other smaller homes on inferrior lots sell for $300k, you may be able to get $300k for yours.

Jfet wrote:Appraisers don't seem to take into account things like carpet, paint, deck stain, even though these things cost time and money.

finished floors and painted walls are expected---they do take it into account if it's not there or in poor condition.
Jfet wrote:The replacement cost of our house is estimated at $550,000 through my insurance agent.

Those numbers are notoriously over-estimated.

Jfet wrote:I am definately NOT interested in having the house on the market for one year, and it seems like putting significant money into a house we must sell no matter what in 2 years is a very big market risk. To me that would be like spending $80,000 on an individual stock when you need that money in two years.

I guess I have kind of answered the question myself :-)


I and others have asked if it is possible to finish the addition and make some of the repairs for much less than 75k and sell a finished house. Is this possible? it's hard to give advice when there is no description of this remodelling project other than: (a) it's not finished (b) it costs 75k to finish. I know it's sunk cost, but how much have you spent on the remodeling project so far? Are we looking at a 150k remodel in a neighborhood of 250k homes?
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Re: Reasonable to sell a house that needs some work?

Postby Jfet » Tue Jun 04, 2013 11:01 am

NateH wrote:
I and others have asked if it is possible to finish the addition and make some of the repairs for much less than 75k and sell a finished house. Is this possible? it's hard to give advice when there is no description of this remodelling project other than: (a) it's not finished (b) it costs 75k to finish. I know it's sunk cost, but how much have you spent on the remodeling project so far? Are we looking at a 150k remodel in a neighborhood of 250k homes?


Well, it is a rather big house but a strange layout. The room that needs remodeling was an indoor pool and is around 1500 sq ft with a 25 foot ceiling. We built a very solid joisted floor over the empty pool (pool is not a danger of floating because the house was built up on a 7 foot poured foundation). We had plans to then build several rooms....possibly a lofted library above a media room and leave the other half open for a game room (I have a ton of pinball machines, heh heh). Our plans have changed since we are selling the house and to finish this room even with just basic sheet rock and carpeting would be around $30,000. All that would get you is one giant room. Converting it back to a pool would be very expensive as the gunite was starting to chip and there was a leak in the circulation system somewhere under the concrete/gunite. Plus now it has tons of anchor bolts into the concrete from the joist system.

The rest of the house is about 3000 square feet with a 1700 square foot 5 car garage with auto pit. Finishing the pool room the way we had envisioned would make the house over 5000 square feet of living space...quite ridiculous in a neighborhood of $250,000 to $300,000 homes.

Kind of a mess huh? I view the house now more as a boat and don't want to throw money down that hole. I could see spending about $10,000 or so on carpets, deck stain, and some other random repairs, but I can't convince myself of the value of turning the home into a $450,000 dream house on the river and selling it for $350,000 because the market is soft.
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Re: Reasonable to sell a house that needs some work?

Postby WhyNotUs » Tue Jun 04, 2013 11:43 am

Remodeling a place with such an usual configuration for resale seems like a bad idea. The 1500 sf open space is perfect with no interior walls for the buyer with vision (i.e. a good idea and lots of cash). Closing it in closes off ideas and increases costs.

The unusual floor plan may suit another buyer in a manner that you could not have anticipated and the discounted price will give them a chance to pursue that medical pot growing operation, chemistry lab, yoga studio, home theater, pilates studio, or other brilliant idea for filling the space that they have been looking for their entire life.

I would market that space as a "field of dreams" and maybe not drop the price as much as you are thinking or depending on the market not at all. The big room and huge garage are a plus for the right person. I would also look for a realtor with the vision and marketing instincts to see your place as a once in a lifetime opportunity for the right person to fulfill their dream. I could see listings in national car fanatic websites or other websites that would suit the pool room or garage. You can lower the price if it does not move during the peak season (I am assuming that is this summer) and still try to get a sale by next summer.

I do not see a kind of a mess but rather a really great opportunity for the right buyer.
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Re: Reasonable to sell a house that needs some work?

Postby Watty » Tue Jun 04, 2013 12:32 pm

Fixing everything would probably cost around $75,000 plus sales tax, so about $82,000. Commission @ 7% on $100,000 is $7,000.

So as a guess, we could sell the house as-is with no sweat put into it and get $279,000 after commission or we could spend a lot of money, time and try to sell it for $400,000 and get $290,000 after deducting repair costs and commission.


Living in a house that is haveing major work done to is is not fun even if it is doable so avoiding that is worth something too.

Fixing what is actually broken is usually a good choice since any potential buyer will assume that that it will be more expensive to fix and take it as an indication that the house has been poorly maintained.

Upgrading what is not broken will get rarely get you your money back.

I would not spend more than 1% of the house price on cosmetic things like new paint unless your real estate agent can give you a good reason for it. What makes sense really depends on your local housing market so your real estate agent could give you a better idea of what is worthwhile.

Getting the large room that the pool was in finished to the point where it qualifies as finished space (drywall, flooring, heat, etc ) would allow the house to be considered a 4,500 square foot house instead of a 3,000 one so it would likely appraise better so that might be a good idea. If I was a potential buyer and it was unfinished I would be concerned that there was some problem with finishing it and that is why it was never completed. Some people might actually want to have an indoor basketball court or tennis court or who knows what so I would not break up the space into a smaller rooms.
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Re: Reasonable to sell a house that needs some work?

Postby Kosmo » Tue Jun 04, 2013 1:02 pm

Jfet wrote:Well, it is a rather big house but a strange layout. The room that needs remodeling was an indoor pool and is around 1500 sq ft with a 25 foot ceiling.

...

The rest of the house is about 3000 square feet with a 1700 square foot 5 car garage with auto pit. Finishing the pool room the way we had envisioned would make the house over 5000 square feet of living space...quite ridiculous in a neighborhood of $250,000 to $300,000 homes.


Honestly, I'd buy that house in a heartbeat for $300k and do the work myself. A house that size with a massive garage, land, and on water would be well over $1MM in my neck of the woods.
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Re: Reasonable to sell a house that needs some work?

Postby DiscoBunny1979 » Tue Jun 04, 2013 1:48 pm

Kosmo wrote:
Jfet wrote:Well, it is a rather big house but a strange layout. The room that needs remodeling was an indoor pool and is around 1500 sq ft with a 25 foot ceiling.

...

The rest of the house is about 3000 square feet with a 1700 square foot 5 car garage with auto pit. Finishing the pool room the way we had envisioned would make the house over 5000 square feet of living space...quite ridiculous in a neighborhood of $250,000 to $300,000 homes.


Honestly, I'd buy that house in a heartbeat for $300k and do the work myself. A house that size with a massive garage, land, and on water would be well over $1MM in my neck of the woods.

---------------------------

No. A house is basically foundation, roof and walls. In my world, a good deal on a house is something that is less than $100 dollars a square foot. Of course if you're in some area that's ridiculously priced like the bay area, that could be different, but in order to put in the 'work' required on this type of situation, $60-$80 a square foot would be my price. At $80 a square foot - 3000 square feet . . we're looking at $240,000. BUT the real question regards to the roof . . . how much work? Some loan requirements include having a roof in good working order before a loan can be closed. Are there all cash buyers for the house, or most houses in the area going for financing options?

Since the OP already knows this house as a money pit, most buyers would probably see it as a gut job, tear everything out and start over. If that's the case the OP's estimates are low. There could be other problems noticed by an inspection relating to the foundational support structure. Deck issues might not just require staining, but replacing of boards or supports that the OP has not addressed.

In determining square footage - it's necessary to know the difference between "Living space" and total square footage. While it's nice to have a large garage, garages and the pool area might not count as living space if they are not fitted with air/heat systems, windows and electrical outlets spaced on the walls as per code.

Other issues not discussed is if the house is on Propane or natural gas . . . whether it's on septic or sewer . . . type of Cable or Phone Line service . . . connected to city water and size of line to the house . . . how does the pool get cleaned out - where does the water go to empty? . . . how close to civilization is the house? Is the nearest home depot an hour a way or is it right around the corner?
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Re: Reasonable to sell a house that needs some work?

Postby Jfet » Tue Jun 04, 2013 6:41 pm

Say I put $82,000 into fixing up the house, finishing off the big room just with sheetrock and carpet, get the roof pressure washed and fix a few chipped tiles (it is a concrete tile roof, built in 1985 and supposedly good for 50 years, but does have a few chipped tiles in the garage area (no leaks) and some moss in places. Probably $2000 for a cherry picker to pressure wash it and repair/replace the few tiles. Then maybe $2000 for new gutters, $1000 to replace a few trim boards. The stuff really will nickel and dime you unless you do it yourself...and we don't have the time or will to do it because we are not staying here.

Then comes a buyer like DiscoBunny1979 and wants a good deal, no matter how much money I have already sunk into the place fixing it up. I am scared of that type of buyer.

Today is a total blue bird day and I actually cut the grass, so here is a picture of the river taken from my back yard. Only one fishing boat right now...on opening day in WA (June 1) there were at least 12 boats and 10 to 15 people standing on the sandbar fishing.

Image
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Re: Reasonable to sell a house that needs some work?

Postby stan1 » Tue Jun 04, 2013 11:29 pm

I think the house is going to be hard to sell based on your description. Hopefully the lot will convince someone to accept the peculiarities of the house -- the property looks beautiful. You don't seem highly motivated to get the highest possible price, and it even seems like you are willing to leave money on the table to move on with your life. You also are planning to contract out the work.

Price it to sell quickly in "as is" condition so you can move on. I will likely also need to do the same with my mom's house in a few years.
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Re: Reasonable to sell a house that needs some work?

Postby Frugal Al » Wed Jun 05, 2013 9:01 am

Looks like a very nice property, albeit a bit unconventional, which obviously makes it tougher to sell. There are buyers that love houses like this--the trick is finding them. There's no way I would renovate prior to sale. Too many variables and tastes to finish out a unique property that doesn't seem to be in a neighborhood/subdivision with identifiable norms.
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Re: Reasonable to sell a house that needs some work?

Postby Kosmo » Wed Jun 05, 2013 11:17 am

DiscoBunny1979 wrote:No. A house is basically foundation, roof and walls. In my world, a good deal on a house is something that is less than $100 dollars a square foot. Of course if you're in some area that's ridiculously priced like the bay area, that could be different, but in order to put in the 'work' required on this type of situation, $60-$80 a square foot would be my price. At $80 a square foot - 3000 square feet . . we're looking at $240,000. BUT the real question regards to the roof . . . how much work? Some loan requirements include having a roof in good working order before a loan can be closed. Are there all cash buyers for the house, or most houses in the area going for financing options?

Since the OP already knows this house as a money pit, most buyers would probably see it as a gut job, tear everything out and start over. If that's the case the OP's estimates are low. There could be other problems noticed by an inspection relating to the foundational support structure. Deck issues might not just require staining, but replacing of boards or supports that the OP has not addressed.

In determining square footage - it's necessary to know the difference between "Living space" and total square footage. While it's nice to have a large garage, garages and the pool area might not count as living space if they are not fitted with air/heat systems, windows and electrical outlets spaced on the walls as per code.

Other issues not discussed is if the house is on Propane or natural gas . . . whether it's on septic or sewer . . . type of Cable or Phone Line service . . . connected to city water and size of line to the house . . . how does the pool get cleaned out - where does the water go to empty? . . . how close to civilization is the house? Is the nearest home depot an hour a way or is it right around the corner?


I presume you're disagreeing with my housing price assessment? I don't think it's that far off. And maybe I'm just used to higher housing prices in my area, but I think your estimate of $240k is unrealistically low. A quick check on realtor.com showed that the cheapest 3000 sf house in my zip code is $370k.

But you do bring up good points about the amenities which may attract or deter buyers: heating fuel, septic/sewer, city/well water, etc. My personal opinion (and hopefully others) is that those aren't a deal breaker. Within reason you can change those things. Proximity to civilization is another biggie. From the picture the OP posted it doesn't look close at all (looks like a vacation spot to me). And there's people out there who would pay top dollar for that.

Don't renovate. Let the buyers make it their own. The only thing I might consider is modernizing anything that is obvious and is clearly outdated or needs repair (appliances, light fixtures, etc.)

Just out of curiosity, how deep is that river? Deep enough for boating/canoeing/kayaking?
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Re: Reasonable to sell a house that needs some work?

Postby stan1 » Wed Jun 05, 2013 11:19 am

Kosmo wrote:Just out of curiosity, how deep is that river? Deep enough for boating/canoeing/kayaking?


Do we have a potential buyer?
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Re: Reasonable to sell a house that needs some work?

Postby Jfet » Wed Jun 05, 2013 11:27 am

Kosmo wrote:But you do bring up good points about the amenities which may attract or deter buyers: heating fuel, septic/sewer, city/well water, etc. My personal opinion (and hopefully others) is that those aren't a deal breaker. Within reason you can change those things. Proximity to civilization is another biggie. From the picture the OP posted it doesn't look close at all (looks like a vacation spot to me). And there's people out there who would pay top dollar for that.

Don't renovate. Let the buyers make it their own. The only thing I might consider is modernizing anything that is obvious and is clearly outdated or needs repair (appliances, light fixtures, etc.)

Just out of curiosity, how deep is that river? Deep enough for boating/canoeing/kayaking?



Lowes and major grocery stores are 6 miles away, so not bad for getting supplies.

The river is about 5 to 6 feet deep right now in front of our house (but with some sandbars..it is a fairly wide river). Two powerboats just sped by going upstream, but they may have had jet drives.

I put in at some rapids in the mountains about 8 miles upriver and kayak down to our house, pulling out right at our yard, then ride my motorcycle back to the truck and drive both back home. Very cold water right now though. We used to have some tubing parties where we had friends put in upriver and float down, while I stayed with them in my kayak until the last hour when I raced home to fire up the grill to have burgers ready for them when they arrived. It has been a fun party house, but we are ready to do different things.
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Re: Reasonable to sell a house that needs some work?

Postby Hikes_With_Dogs » Wed Jun 05, 2013 12:16 pm

I hope this doesn't come across poorly, but how much is the land worth?

To me it sounds like something you'd bulldoze and build over and buy for the beautiful lot and serenity.
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Re: Reasonable to sell a house that needs some work?

Postby Jfet » Wed Jun 05, 2013 12:38 pm

Hikes_With_Dogs wrote:I hope this doesn't come across poorly, but how much is the land worth?

To me it sounds like something you'd bulldoze and build over and buy for the beautiful lot and serenity.


Heh, I did not mean to give the impression that the house was in total disrepair....just that it is a big house and needs TLC as big houses do.

I am not sure you could even get a permit to build on these rivers with all of the protections these days. I would guess the lot is worth $200K if you could rebuild on the 7 foot high foundation of the house. But the cedar deck we built just a few years ago (12 to 16 feet wide and 60 feet long) cost us $15,000 in materials alone (we did the work ourselves). Tearing down the house would be a pity.
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Re: Reasonable to sell a house that needs some work?

Postby damjam » Wed Jun 05, 2013 1:02 pm

Jfet wrote:I am not sure you could even get a permit to build on these rivers with all of the protections these days.

That adds a different dimension to the whole thing. Having a large footprint in an area where getting permits is difficult is worth something in itself. Oftentimes an owner can remodel and existing structure even when they can't build new.
I vote for leaving as is. I don't think you mention any leaks, but if they exist fix those and leave the rest of the decisions for the next owner.
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Re: Reasonable to sell a house that needs some work?

Postby inbox788 » Wed Jun 05, 2013 1:03 pm

In The Weeds wrote:The problem I see with "fixing it up" before you sell is you have to find a buyer that likes what you have done to the house...other hand is you have to find a buyer that can see the potential in buying a house that needs work.

I will be facing the same problem in a year or so...I'm leaning to sell as is.


Sounds like a true fixer upper, which I think most markets have few buyers, or more importantly fewer buyers than sellers that want to do a lot of repairs and upgrades. How close is it to land cost for some who wants to level it? If its not, then I'd suggest fixing it up to average standards for comparable sales.

Are you living in it, or is it empty for some serious rehab? If you have to out up with construction, that would be a negative. Where would you live if you sold the house today?

A lot depends on your local market, but my expectation is that very new or very run down homes are going to be the least value for you. Do an estimated ROI on each project keeping in mind what buyer you'll be including or excluding. Even if the price is very good, I don't think more than 5-10% of buyers would want to take it on. If you fix the big stuff, like the unfinished room, you open it up to the middle 50%. If you over do it, and the house is like new demanding new construction home prices, you'll be looking at the top 5-10%. Lower demand means lower prices for you and likely longer sales times.
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Re: Reasonable to sell a house that needs some work?

Postby Kosmo » Wed Jun 05, 2013 1:15 pm

stan1 wrote:
Kosmo wrote:Just out of curiosity, how deep is that river? Deep enough for boating/canoeing/kayaking?


Do we have a potential buyer?


If only I didn't just purchase a money pit of my very own!
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Re: Reasonable to sell a house that needs some work?

Postby bungalow10 » Wed Jun 05, 2013 1:55 pm

Kosmo wrote:
DiscoBunny1979 wrote:No. A house is basically foundation, roof and walls. In my world, a good deal on a house is something that is less than $100 dollars a square foot. Of course if you're in some area that's ridiculously priced like the bay area, that could be different, but in order to put in the 'work' required on this type of situation, $60-$80 a square foot would be my price. At $80 a square foot - 3000 square feet . . we're looking at $240,000. BUT the real question regards to the roof . . . how much work? Some loan requirements include having a roof in good working order before a loan can be closed. Are there all cash buyers for the house, or most houses in the area going for financing options?

Since the OP already knows this house as a money pit, most buyers would probably see it as a gut job, tear everything out and start over. If that's the case the OP's estimates are low. There could be other problems noticed by an inspection relating to the foundational support structure. Deck issues might not just require staining, but replacing of boards or supports that the OP has not addressed.

In determining square footage - it's necessary to know the difference between "Living space" and total square footage. While it's nice to have a large garage, garages and the pool area might not count as living space if they are not fitted with air/heat systems, windows and electrical outlets spaced on the walls as per code.

Other issues not discussed is if the house is on Propane or natural gas . . . whether it's on septic or sewer . . . type of Cable or Phone Line service . . . connected to city water and size of line to the house . . . how does the pool get cleaned out - where does the water go to empty? . . . how close to civilization is the house? Is the nearest home depot an hour a way or is it right around the corner?


I presume you're disagreeing with my housing price assessment? I don't think it's that far off. And maybe I'm just used to higher housing prices in my area, but I think your estimate of $240k is unrealistically low. A quick check on realtor.com showed that the cheapest 3000 sf house in my zip code is $370k.

But you do bring up good points about the amenities which may attract or deter buyers: heating fuel, septic/sewer, city/well water, etc. My personal opinion (and hopefully others) is that those aren't a deal breaker. Within reason you can change those things. Proximity to civilization is another biggie. From the picture the OP posted it doesn't look close at all (looks like a vacation spot to me). And there's people out there who would pay top dollar for that.

Don't renovate. Let the buyers make it their own. The only thing I might consider is modernizing anything that is obvious and is clearly outdated or needs repair (appliances, light fixtures, etc.)

Just out of curiosity, how deep is that river? Deep enough for boating/canoeing/kayaking?


I wouldn't worry about DiscoBunny. I think he/she isn't taking lot into consideration... probably used to using the $60-80 square foot valuation for a vanilla ranch in a subdivision. I think most people understand that lakefront property goes for a bit more.

Heck, I live in a small town in a flyover state, no lake front property here, and my 100 year old house would easily sell for $100 square foot.
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Re: Reasonable to sell a house that needs some work?

Postby DickBenson » Wed Jun 05, 2013 1:57 pm

How does one find builders or fixer uppers that will buy houses that need work, refurbish them, and then resell them?

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Re: Reasonable to sell a house that needs some work?

Postby Rodc » Wed Jun 05, 2013 5:04 pm

DickBenson wrote:How does one find builders or fixer uppers that will buy houses that need work, refurbish them, and then resell them?

Dick


Around here you take a small or medium sized house on any lot, or even a fairly big house if on a large lot and put a For Sale sign up.

Well, they don't refurb them, they knock them down a build a much bigger house.
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Re: Reasonable to sell a house that needs some work?

Postby LadyGeek » Wed Jun 05, 2013 5:09 pm

This thread is now in the Personal Consumer Issues forum (selling a house).
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Re: Reasonable to sell a house that needs some work?

Postby Jessica S » Wed Jun 05, 2013 8:58 pm

DickBenson wrote:How does one find builders or fixer uppers that will buy houses that need work, refurbish them, and then resell them?

Dick


They are usually actively trying to find houses so they shouldn't be too hard to find. A FSBO ad on Craigslist will probably draw some response from real estate investors, particularly if you include the word "Fixer" in the title.

There is also a website called Bigger Pockets that is for real estate investors. It has a very active forum. (If you are a boglehead the Bigger Pockets forum will make your head spin with all its talk of leveraging)
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Re: Reasonable to sell a house that needs some work?

Postby Boglenaut » Wed Jun 05, 2013 9:10 pm

"Reasonable to sell a house that needs some work?"

It's better than keeping a house in need of some work.

Bake the cost of work in.
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