Brokers / flippers that do cash buys (agents, Realtor, listing, sellers)

[cdelena]

I am the executor of an estate that needs to sell a family house and am simply trying to get the highest net proceeds for the estate.

The house is a solid unit built in 1958 but has had few updates over the years. I have no ability to manage refurbishment as I am not in the area. The tax authority has appraised it at 240 and comps in the area run from 200 to 280 depending upon condition / finish. The brief talk with a realtor talked about limited updates and then talked about a sale at 225. After paying for updates and 6% the net may be less than 200.

I have received more than a dozen solicitations from brokers interested in buying the property. Before contracting with a realtor I am considering having a simple open house inviting those brokers looking towards getting the highest net for the estate.

Any tips on this process? Anything to avoid or do?


(there are six beneficiaries of the estate with differing expectations so I must be able to justify actions)

[jackmichigan]

I think that getting an appraisal would strengthen your position with both the beneficiaries and anyone looking to buy the property. If brokers are actively looking to purchase it, they probably figure that they can buy it for less than market value. A sale to someone who will live in the property will usually yield a better price than a sale to an investor.

[chet everett]

Originally Posted by cdelena

I am the executor of an estate that needs to sell a family house and am simply trying to get the highest net proceeds for the estate.

The house is a solid unit built in 1958 but has had few updates over the years. I have no ability to manage refurbishment as I am not in the area. The tax authority has appraised it at 240 and comps in the area run from 200 to 280 depending upon condition / finish. The brief talk with a realtor talked about limited updates and then talked about a sale at 225. After paying for updates and 6% the net may be less than 200.

I have received more than a dozen solicitations from brokers interested in buying the property. Before contracting with a realtor I am considering having a simple open house inviting those brokers looking towards getting the highest net for the estate.

Any tips on this process? Anything to avoid or do?


(there are six beneficiaries of the estate with differing expectations so I must be able to justify actions)

Originally Posted by jackmichigan

I think that getting an appraisal would strengthen your position with both the beneficiaries and anyone looking to buy the property. If brokers are actively looking to purchase it, they probably figure that they can buy it for less than market value. A sale to someone who will live in the property will usually yield a better price than a sale to an investor.

First it needs to be pointed out that in the standard US usage a "real estate broker" is NOT generally serving the function of a "commodities broker" who buys and sells goods but rather can be thought of as "supervisor" of traditional real estate agents. If the OP has "solicitations" from traditional real estate broker they are very likely looking to LIST the property for sale, not necessarily to buy / flip it.

Depending on where the OP is located it is very risky to consider attempting to pay to fix up a home before listing -- nearly all real estate professionals who have experience in dealing with estate generally would suggest an "as is" sale makes more sense.

It is also not unheard of for folks to consider different compensation structures when selling a vacant home in an estate sale...

If the OP is not familiar with appropriate pricing for the home in its current condition an appraisal may be helpful, but even the most rigorous appraisal is always based primarily on recent sales of similar homes with adjustments made for condition, features, location and similar factors -- similar info can come from a "broker price opinion"...


The idea of having a "mass event" for brokers to potentially compete for the listing is perhaps not the smartest way to here each potential marketing strategy -- the network of potential buyers that brokers may have been successful with is something that most brokers prefer to discuss one on one...

[jdhall1]

I'd do indepdent appraisal as well as possibly do a home inspection so you know what you are getting into in case a non-home flipper is interested in the house

[chet everett]

Originally Posted by jdhall1

I'd do indepdent appraisal as well as possibly do a home inspection so you know what you are getting into in case a non-home flipper is interested in the house

The benefits that comes when trying to sell a home from an estate "as-is" include a full legitimate ability to say that you truly have no idea if there are any items needing repair. Unfortunately when you decide to hire an inspector to assess the condition of a home prior to sale you will end up giving away that protection; potentially a buyer could compel the inspector to disclose information that was supplied to the seller about needed repairs. This varies by state and should be investigated...

[cdelena]

Thanks for all the feedback. It is helpful.

The term 'brokers' is my terminology, not theirs. House flippers may be more accurate.

Two beneficiaries have extensive experience in the area and suggest a retail price of 229, but I have pointed out that the relator fee, negotiation, and repairs after an inspection can net much less. It is a very hot area for this price range.

The open house I was planning was nothing more than a time the house will be available for viewing. Any interested party could pick up a flyer that directs them to call me to discuss or make an offer.

Rather than pay for an appraisal I was thinking that cash offers from these 'brokers' would be a good sounding.

[I love boots.]

I would just get the opinion of value from more than one listing agent. This way, you not only have more than one opinion but you then have more than one person to choose from to list it for you. And these are free. An appraisal isn't and as someone else already pointed out, they use the same data.

Rather than list it as is, I would just list it and see what comes up during an inspection. Why give someone the impression that you wouldn't agree to any repairs before knowing what they may be? What if they aren't much to deal with and it gets the house sold? Let the inspection be on the buyer to do. You have to disclose what you know about the property before selling, but sellers are not required to look for defects. It may be to your advantage if you honestly don't know everything.

[JustMike77]

Check with your lawyer or accountant since you will most likely need a "date of death" appraisal to settle the estate. That should give you some guidance.

[MikeJaquish]

I think you may get legitimate pushback from an heir who is not on board with you selling the house quick and at wholesale pricing, rather than to expose it to the broad market to try to get the best price.

You should get guidance as to your duty to the estate and the heirs to deliver a best price.

And... I may be all wet on the point, if your fellow heirs share a common attitude. If not, the point is worth consideration.

[Diana Holbrook]

I agree with ^. As someone who has been an heir a few times now, even in the friendliest of estates, make sure everyone agrees on the price. I think you want an open market price and should hope to verify that price with a timely but not too-quick sale.