Rehab parent's house before selling? (Part 2)

[jghorton]

Why not simply discount the house below $300K in the amount of slightly less than the anticipated updates/renovations/cleaning - and see if it sells.

If it sells, you will save yourself the time, aggravation and uncertainty. If it doesn't sell, you may not gain what you expect by doing the work.

[tamajane]

I'm just going to say it OP, you seem to have a case of low house esteem. It doesn't sound that bad - new roof, good foundation, good exterior. But you are looking way ahead, other things could go wrong in 5-10 years. If you were selling now I would say to stop thinking it is so terrible, slap on a little paint and market it to people as well as contractors. Don't worry about HGTV watching types expecting perfection, some practical couple may come along and see the potential. You can put lipstick on a pig, or a semi-pig or a pig with potential. It shows care, just do it right.

Yes you can market specifically to investors -flippers, and contractors but if you are telling it like it is, it doesn't need to be. I am dealing with an older home too and deciding what work to put in or not. There are a lot of variables but you are ahead of the game if the house will qualify for a conventional mortgage. If so there is no need to limit your pool of buyers to flippers unless you just want a cash deal which will normally be low.

[MrRational]

Originally Posted by HDWill1

I'm still wondering though, should I do anything at all to it?

Clear of all debris and then cleaned up to the polished level.

If anything is really filthy expect to remove it.
If anything minor is broken expect to FIX the smaller things 100%
If anything major is broken expect to get a pro estimate for the work needed.

Once you've gotten rid of these question marks... reassess.
Neutral paint and fresh gloss on the trim? Probably so.
New (inexpensive) carpet? Sure.
But not much more.

Nice enough that a buyer could move in and be okay for a few years.
No more.

If something like a bad roof or old furnace would prevent a sale...
then plan to do these things ONLY after you have a buyer under contract.
Then step up and get it done quick.

[dblackga]

Originally Posted by HDWill1

What do you consider obvious repairs? The damaged section of wall paneling I mentioned above is very "obvious," and as you state, the buyer will tearing the interior down to the studs.

I've accepted that the house likely won't sell for much above $150k at any rate.

Obvious repairs are generally holes in the roof or flooring where you can see daylight, trees lying on a house, etc. And even those aren't necessarily deterrents to a determined flipper in a hot area. It's easy to get caught up in the "but if I fix this, I'll make more on the sale." I've seen people lose a bushel of money trying to "upgrade" Mom's house, and get really twisted over the fact that they spent $1500 on a granite counter and aren't seeing a return in the offers they receive.

[HDWill1]

I appreciate the replies.

Honestly I'm still a bit torn between dblackga's perspective and some of the others-- I can imagine spending like $15k to make the house "livable"/spotless, including paint, resurfacing bathrooms and countertops etc, but it would be very likely that all that would be immediately torn out. But then if you're going after a potential owner-occupant rather than a flipper, those psychological factors may come into play (i.e., stains and broken stuff are big turn-offs).

I may end up just doing the painting and little else, if only to deal with the remaining pet odors. I'll look forward to having some in-depth discussions with a realtor when the time comes.

[chet everett]

Originally Posted by HDWill1

I appreciate the replies.

Honestly I'm still a bit torn between dblackga's perspective and some of the others-- I can imagine spending like $15k to make the house "livable"/spotless, including paint, resurfacing bathrooms and countertops etc, but it would be very likely that all that would be immediately torn out. But then if you're going after a potential owner-occupant rather than a flipper, those psychological factors may come into play (i.e., stains and broken stuff are big turn-offs).

I may end up just doing the painting and little else, if only to deal with the remaining pet odors. I'll look forward to having some in-depth discussions with a realtor when the time comes.

The variations that are due to LOCAL CONDITIONS are KEY to the sorts of decisions you should consider.

I personally have bought homes like the one the OP's mother lives in and I was able to get the place at an extraordinarily low price partially because it was SO DISGUSTING that the seller (technically the heirs of the folks who lived in the place until their demise...) simply had to idea where to start with even basic clean-up. I had contacts with contractors who would use very inexpensive day laborers to literally shovel EVERYTHING into a dumpster, that made it quick and easy to renovate the place to "rentable condition". Though I eventually sold the place I would be lying if I told you if I really "flipped it". What I was able to do was RIDE THE WAVE of increasing home prices.

NOW there are many more towns where it is MUCH MORE likely to be able to attract folks willing to put "finishing touches" on a home that is basically solid. That is a function of the expansion of the kinds of people willing to put some "sweat equity" into a starter home. IF that is the sort of area the OP's mom's home is in there could be LOTS of value adding in cleaning the home so that all the gross stuff and obvious damage is eliminated. It might even make sense to get estimates from small "work by myself" type electricians and plumbers who might do things like upgrade to 200A service / breakers and modern water pipes as a side job on weekends for a relatively modest sum. Of course if the LAYOUT of the home is so out of date that it is unlikely that anyone would really undertake any "finishing touches" there would be no reason to really do those sorts of upgrades...

IF there is a healthy market for teardowns the fact is that the folks shopping for such places fall into two rather distinct subcategories -- the first category is potential home owners who BELIEVE ME do not want to see any sort of "horder / firebug nightmare" on the site of their future dream home. The second category is BUILDERS who despite the fact that the additional "clean out" will not really cost them one red cent (as any household materials can be landfilled along with the demolition debris) the PSYCHOLOGY of them making an offer for a place that at least is CLEAN and maybe has some good memories for the heirs is going to force them to offer a more fair price than if the vacant home is filled with a nightmare of burned countertops and scorched paneling that the builder knows is indicative of an heir who just does not want to lift a finger to get out from under...

I have helped sellers in each of the different categories and there is NEVER a good reason to leave a home with any obvious signs of damage / neglect. It simply makes sense to consider the mindset of the potential buyer and the effort that goes into both minor cleanup as well as "partial demolition" should be in the category of "elbow grease" that will help for a faster and more profitable sale. I can say with confidence that even the those who say things like "seeing the place 'AsIs' makes it easier for me to evaluate potential renovations are REALLY NOT REFLECTIVE of real world experience -- such flippers are using the info gleaned from their first viewing to gauge what the motivation of the seller truly is! If the place looks like it was inhabited by somebody who was incapable of properly placing space heaters, very used used a trivet to protect the counters, and let their pets ruin carpets and floors they will offer less than for a place that is shell that MIGHT have been cared for once upon a time...