How to Sell a House in Poor Condition

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|10 min read

Selling a house is stressful in any circumstance. You are going through a major life change where everything you own needs to be packed up, transferred to a new location, and put back into place.

However, selling a house in poor condition can be even more stressful. It’s natural to worry about finding interested buyers while also wanting to get the fair market value for your home.

Sellers of distressed homes often worry about the timing of the home sale. No one wants their property to sit on the market for several months. 

Fortunately, you can develop a strategy to sell your home, regardless of its current state. You can work with real estate professionals who know how to market the property and find the best elements that make it desirable.

Use this guide to discover your options and learn how to sell a house in poor condition.

What ‘Poor Condition’ Really Means?

The phrase “poor condition,” is often a catch-all term to refer to properties that need work. However, it doesn’t actually define the state of your property.

While you can use the phrase poor condition to describe your home, it might be better to use a more definitive term that provides context to agents and buyers. Here are a few common terms and what they mean. 

  • Fair condition: if a house is rundown but habitable, then it is considered a fair condition property. A fair-condition property might need significant repairs or upgrades, but someone can live there safely.  
  • Uninhabitable: this means the house is unsafe or unsanitary to live in. This is how many Realtors define a poor-condition home. An uninhabitable property might have a severe mold problem or serious plumbing issues that cause leaks throughout the property. 
  • Needing major repairs: there are times when a habitable property would be considered poor condition. This occurs when the house needs major repairs to make it functional. For example, a severely damaged roof could cause leaks and drafts throughout the year. The longer the repairs are neglected, the more damage they cause.   
  • Needing significant cleaning or renovation: even if a home doesn’t need structural repairs, there might be issues that need to be addressed before they can move it. For example, decades of cigarette smoke could have seeped into the walls. Odors from pet urine could linger in the carpet. Either the seller or the buyer will need to take care of these renovations. 

These terms are used to define homes across most areas. However, your local real estate market might be different. Ask a real estate agent to look at your home and see how they would define it.

Partner with the Right Real Estate Agent

If you live in a property that is considered to be in poor condition, your first step is to meet with a real estate agent to discuss your options. In most cases, the Realtor will visit your home and provide an evaluation of its worth along with recommendations on how to sell it. However, it’s understandable if you don’t want to invite these experts to your property just yet. 

Consider meeting with three or four Realtor candidates at a secondary location, like their brokerage office, a coffee shop, or your local library. You can show them pictures of your home and determine which agent will be the best fit for your needs. Once you feel comfortable with the Realtor you want to hire, you can invite them to see your home. 

Some people feel comfortable inviting agents into their homes immediately. If that is your case, you can ask at least three agents to tour your property and provide a value estimate on the home sale. 

Each agent should give you a comparative market analysis (CMA) on the property. You can also use your guides on how to interview real estate agents to ask the right questions based on your needs. 

Meeting with multiple Realtors is essential when selling a home in poor condition. You need to trust that your agent is experienced enough to find buyers and a good person to work with. If you don’t feel like you can trust your Realtor and that they are looking out for your best interest, find another agent in your area. 

Evaluate Your Options for Addressing Property’s Condition

Once you decide to sell your home, the next step is to determine how much work you want to put into the property before you list it. The average seller invests $5,400 in their home when they are preparing to sell it. If your property needs major repairs or renovations, then you could spend thousands of dollars more. 

Not only are repairs and renovations expensive, but they are also time-consuming. If you want to replace your roof, you might have to push back your sale date by a month while you wait for the contractors to find time on their schedules.  

As you talk with your real estate agent, go over how much time and money you are willing to spend when preparing your home for sale. Here are a few levels of investment to consider.

Sell As-Is

The first option is to sell your house as-is. This means you will not make any renovations or improvements on the property before you list it. There are significant benefits to selling as-is:

  • You can list your house immediately. This is ideal if you need to move in a hurry. 
  • You won’t spend any money on repairs. This is a good choice if you don’t have a lot of cash on hand to improve your home. 
  • Buyers will be less likely to request repair contingencies. When selling as-is, you don’t have to keep accommodating buyers who want changes to the property before they move in. 

There are also drawbacks to selling a house as-is. The number of buyers interested in your house will be smaller, as many people want turnkey properties. Even if you list your home today, it might take longer to sell. Plus, selling as-is often comes with a lower listing price. You might not make as much on the sale compared to a homeowner who made repairs. 

Your real estate agent will do their best to pair you with qualified buyers. They will usually reach out to their real estate investor pool to find people who are searching for fixer-uppers.

Cosmetic Improvements

An alternative to selling a house as-is would be making cosmetic repairs that attract buyers. For example, you could invest in a deep cleaning of the property, repaint the walls, and replace the carpet. This gives your home a makeover and makes it seem more attractive to buyers. Cosmetic improvements are often cheaper – the average cost to clean a house is around $120 to $280 – and faster than major upgrades. 

While investing in these minor repairs and improvements will make your home more desirable, you will need to be transparent about any potential issues. Your buyers will likely want to complete a home inspection, which will uncover any major repairs or issues with the property. It is better to be upfront about these repairs early on so you don’t lose your buyers and have to remarket your home. 

Spending a few hundred dollars on cosmetic improvements can increase the value of your property; however, the house still needs to be fairly priced based on the amount of work the buyer needs to do. For example, it could cost tens of thousands of dollars to repair a roof. It will be hard for some interested parties to look past that defect, even if the house has new flooring.

Major Repairs and Upgrades

The third option is to invest in major repairs and upgrades. This is the most expensive and time-consuming option but it could also have the biggest payout. You will need to spend tens of thousands of dollars renovating your home, from updating the electrical system to redoing the plumbing. You will also need to consider which cosmetic upgrades you want to invest in to attract potential buyers. 

It can be hard to strike a balance between appealing to potential buyers visually and making extensive repairs that are attractive to them logically. Staging and cosmetic upgrades tap into the emotional nature of the house-hunting process.

Buyers can picture themselves living in your house and modifying it based on their needs. However, major repairs give them confidence. A buyer can feel good about purchasing a house with a new air conditioning system because they won’t have to spend money on replacing it in the future. 

Your Realtor can help you decide which cosmetic upgrades and repairs are worth your time. You might make one or two improvements to update the house and then let your buyers take over. This is a fair way to bring your home out of its poor condition without overwhelming you with work.

Set a Realistic Price for Your Local Real Estate Market

The price is one of the most important aspects of your home sale. If you set a price that is too high, you won’t attract buyers to your property. However, you also want to get the maximum amount of money based on what your house is worth, so you don’t want to undersell it. 

Your Realtor will run an analysis to understand the fair market value of your home. They will compare the location, size, and condition of your house to others in the area. They also might offer value estimates if you sell your house as-is compared to the benefits of selling a house that has been repaired. This can give you an idea of how much money you could make with a few upgrades – and whether more money is worth it. 

Knowing your home’s market value will help you set a fair price. You won’t have to accept lowball offers from prospective buyers but also won’t outprice yourself in the local market. In a hot seller’s market, you might get your asking price from cash buyers shortly after listing.

However, in a slower market, you might need to negotiate a fair deal based on the offers that come in. Your Realtor can guide you through all of this.

Use Effective Marketing Techniques for Fixer-Uppers

Once your house is ready for sale – even if you are selling as-is – and you set a reasonable price, your Realtor can start marketing the property. They might reach out to cash buyers who are looking for real estate investments or hold open houses to drum up excitement about the property. 

Your agent should understand your home sale goals, whether that means selling your home quickly or getting a fair price for the property. If you are in a hurry, they can help you negotiate deals with real estate investors who can take over the property quickly. If you want a fair price, they can help you stay strong when lowball offers come in. 

Talk to your agent if you have any concerns about showing your property. For example, if you live with an aging relative, you might need to stay in the home when buyers are touring it.

If you have pets, buyer’s agents need to be careful to not let them out. Anyone who visits your property will still be respectful of your belongings and your home, regardless of their condition.

Explore Cash Offers and Quick Sale Options

While your agent will go over your options for making repairs and upgrades, you can also choose the types of buyers you market your home to. 

For example, you can list your house on your local real estate market or you can work with local real estate investors who might be interested in flipping your property. With this option, your Realtor might be able to set up meetings with qualified buyers even before your home gets published on the multiple listing service (MLS). A real estate investor is also more like to buy a house as-is because they understand the nature of your home sale. 

Your Realtor might also connect you with cash buyers who are interested in your property. These are either investors or buyers who looking for project homes. Looking for cash buyers is often the best option when selling a house in fair or poor condition. They won’t get held up by mortgage lenders who consider poor-condition properties to be risky.

The cash buyer will either have enough money to make the repairs or will buy the house with cash and then take out a renovation loan after the closing appointment.  

Your local real estate professional should go over the best options for selling your house as-is. They will help you understand your ideal target buyers and how your agent will attract them.

Whether you decide to invest in major repairs or want to sell your house as-is, there are specific legal guidelines to follow when listing a property in poor condition. The main thing to remember is that you need to be transparent about any known issues.

Failing to disclose problems that you knew about is unethical and you could be held liable for misleading buyers if they can prove that you were aware of the issues.  

Experienced buyers expect to see a seller disclosure with the home. This document reviews every potential flaw and issue with the property that the seller knows about. It also covers information related to the appliances and other amenities.

For example, if the seller plans to move with the washer and dryer, it will be included in the seller disclosure form so the buyer doesn’t think those appliances are included in the price.  

The seller disclosure is used to review known issues and major repairs the buyer will need to make. The home inspection is designed to uncover previously unknown issues. Both the home inspection and the disclosure form will give the buyer an objective, transparent picture of the house so they are aware of repairs needed once they move in.

You don’t need to make repairs to a property or remodel it before listing it for sale. As long as you are transparent about the home and the major repairs it needs, you should be able to sell the house as-is.

Start Your Home Sale With a Real Estate Agent

Don’t feel stressed if your house is in poor condition and you can’t make major repairs. This is a common occurrence that Realtors face every day. Experienced agents encounter properties in different types of conditions with homeowners who are eager to sell as-is.

Whether you want to save money on repairs or need to move quickly, your Realtor can help you reach your goals. Know your options and your target buyers to sell your home fast.  

To find an agent who can find potential buyers and real estate investors for your home, turn to FastExpert. You can read Realtor profiles and get to know the professionals in your area. Our system can give you the confidence to reach out to the right people when selling a house. Try FastExpert today and feel confident in the home sale process.

Amanda Dodge

Amanda Dodge is a real estate writer and expert. She has worked in the field for more than eight years. She spends her time writing and researching trends in real estate, finance, and business. She graduated with a bachelor's degree in Communications from Florida State University.

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