When you’re ready to sell your fix and flip, you should make sure to address potential problems before you list the property. Issues related to a home’s condition will be discovered during the home inspection anyway, so it’s in your best interest to remedy existing issues before someone makes an offer. At the very least, you should be aware of any problems to make sure there won’t be surprises that could hinder the sale. It’s also essential for you to be upfront with your agent. He or she should know about any major challenges before you start receiving offers, so you can go over all of your options together to find the best way of overcoming them to successfully sell your project and maximize your real estate investment. A great agent will be able to sell your home regardless of the less-than-stellar condition, as long as you are honest, willing to compromise, and proactive in seeking a solution.
Here are six common issues that could hinder your home sale, if ignored:
1. Pest or Rodent Infestations
Whether you are a homeowner or a fix and flipper, pests may seem like a minor issue that many deal with on some level, but minor issues can easily grow into major problems. When you’re selling a home, it’s a good idea to deal with pest infestations head on because it can end up saving you hundreds or thousands of dollars in the long run. Termites can destroy weight-bearing walls or other wooden supports in the home which can affect the entire foundation and structure of the home. Pests like mice, bats, and squirrels can hole up in the most unlikely of places — inside walls, chimneys, and even under the house — and cause a lot of damage over time. They’re also just plain annoying to deal with, and most buyers will walk away from a home with major pest problems.
2. Major Structural Issues
A home with major structural issues will be hard to sell to your average home buyer. Serious structural issues include problems with the foundation, walls, and support beams, and pose a real safety concern for anyone living in the home. Buyers are looking to make a smart investment when they purchase a home, and most are unwilling to buy a home with serious problems. Problems with your home’s main structure will drive away most buyers because they will be looking to purchase a home that will last for years. When you embark on your flip, hire a trusted contractor to give you an estimate on the necessary repairs. When you are looking to flip for a profit, it may be tempting to avoid certain big ticket structural repairs, but the bottom line is the property won't sell as quickly or at the price point you are aiming for. This equals many extra days on market and additional loan and interest payments that you'll be responsible for that will quickly eat into profits.
3. Water Penetration
The most common deal killer in real estate is water damage. Water penetration is one of the top issues that could hinder your home sale because even the smallest amount of water can lead to major problems. Water penetration can lead to mold infestation and cause the home to rot, two big concerns if you want your home to sell. If your home has ever flooded before or during your rehab project, or if you know of any existing leaks, take care of it. Water penetration problems can be very straightforward to fix, but it’s important to address the issue before you list the home. The average buyer gets cold feet when they hear about any water issues, so take care of the problem yourself before you try to sell.
4. Mold Infestation
It’s a no-brainer that mold can — and will — hinder your home sale. Buyers are understandably wary of buying a home with mold because it likely points to water penetration and can be very toxic to one's health. To deal with the problem professionally and correctly, you will need to turn to a mold remediation company to help solve the problem. These companies specialize in removing and preventing mold from growing in the home, so you can sell your home successfully and quickly!
5. Failing Septic System
When a buyer sees a home with a failing septic system, they will usually ask the seller to remedy the issue or move on to another home with a sound septic system. It’s easy to see why this would kill your home sale. A home inspection will reveal any septic issues anyway, so it’s in the seller’s best interest to pay to repair the septic system before they list their home. Most buyers are still willing to buy your home as long as the seller agrees to fix the problems before closing. When a seller refuses to cover repairs, this translates into an as-is home sale which usually results in a seller taking significantly less money for their home. Consult with your agent and make the best decision for your situation.
6. Unsavory Neighbors or Bad Neighborhood Reputation
Perhaps the hardest issue to overcome when selling your home is an issue relating to the neighborhood or neighbors, not the home itself. The above home issues are all things that a seller can pay to fix, but unfortunately it is much harder to find a solution to things that are out of your control. For example, if a registered sex offender lives nearby, it may hinder your home sale when selling to families with children. If there are foreclosed homes on your street or a neighbor who insists on storing their junk on the front lawn, it can affect your home sale and even the value of real estate investment. Fix and flip properties that you can score the best deals on are typically in up and coming neighborhoods which have real potential but may have some of these unsavory characteristics at the time you are looking to sell. It is imperative that you choose an agent who has experience selling homes in these kinds of situations. He or she should be able to come up with a winning strategy to successfully sell your home regardless of these issues.
If you’re done with rehab and ready to sell your fix and flip, contact the Keri Shull Team! Their agents have sold hundreds of homes with varying issues for nearly a decade. They know how to achieve a successful home sale and will always put the seller’s best interests first. Walnut Street has used them and recommends them hands down!
Do you have questions about the fix and flip process? Do you know what loan is perfect for your project? Download our guide to find out.