How to find a buyer for a house that needs a lot of work.

8 Replies

I am hoping to get a few suggestions on how to go about finding the right buyer for a house that family members are looking to sell and needs quite a bit of work.  At this point the owners are just looking to get out of the house and downsize to something more manageable, but need to sell this in order to do so.  Would the best route be to get a local real estate agent to sell the house, or would selling it without one possibly be a better option? 

Just to give everyone an idea of the scope of work needed, it includes new siding, roof, plumbing, extensive electrical work, full gut bathroom and kitchen, possible mold issues, and a few other smaller issues. The house is 2000 soft, 4 bedrooms, 2 bath with just under an acre of land.

Any suggestions on how to go about this would be greatly appreciated.

@Jeff Haak

I would start with coming up with a realistic price for the place.  From everything that you've listed, it sounds like the entire place is a gut job.

Start with comps and work backwards.  If you get to zero before finishing the renovation, it might be worth demolishing the place and selling the buildable lot.  

If there is a fair amount left over after renovations, I'd start with BP members in the Rochester area.  If no one bites here, start calling contractors to see if any of them are flippers.  If no one wants it, put it on the market with an agent.  I don't foresee an easy sale here.

@Jeff Haak Aaron is right. You need to price it to where it makes sense for an investor/flipper to buy it. We move properties like that all the time out here in Saint Louis. Some in even worse shape. List it on CL as well as Zillow. Make sure your family member understands that they are likely to get 45-50 cents on the dollar. To sell it quickly to a flipper you are going to have to find the value of the home fixed up. Take that value and multiply it by .70 to give them 30% room for profit. From there subtract the cost of the work. What you have left is your asking price. If you follow that formula you should sell it easily. You could try starting at .75 - repairs and let them beat you down.

Ryan Dossey, Real Estate Agent in IN (#RB15001099)

@Aaron Montague , @Ryan Dossey  Thanks for the replies.  It definitely won't be an easy sale.  Frustrating because its a nice location, but this is what happens when proper maintenance and repairs aren't done over time.  

@Jeff Haak

If it is a nice location and the owners are realistic, it should be a very easy sale :)  Rehabbers aren't afraid of anything.  Most experienced ones can walk a house in 20 minutes and see the next 6 months clearly in their head.

@Aaron Montague  Thats exactly the kind of buyer I am looking for.  Hopefully with this snow finally melting around here it will be easier for someone to see the potential of the house and the land together.

Originally posted by @Jeff Haak :

@Aaron Montague  Thats exactly the kind of buyer I am looking for.  Hopefully with this snow finally melting around here it will be easier for someone to see the potential of the house and the land together.

 Jeff, you found me, haha!  I just sent you a PM.  Give me a call!  I'd love to buy it!

Hey Jeff,

We specialize in those types of rehabs and our goal is for everyone to win in the transaction. You can message me here, email me [email protected] or call me on my cell 585-317-5699.

Thank you and I look forward to hearing from you!

Originally posted by @Jeff Haak :

@Aaron Montague , @Ryan Dossey  Thanks for the replies.  It definitely won't be an easy sale.  Frustrating because its a nice location, but this is what happens when proper maintenance and repairs aren't done over time.  

 Location is the key .  A good location with a crappy house , there are pleanty of people who will buy , Builders being one .  In my neighborhood , a teardown sold for $225,000 , because the neighborhood is in demand , and unfinished lots sell for the same or more.  Since its a teardown , the builder saves on capital connection fees, school impact fees , front footage fees are done , etc . That adds up to close to 60 grand . 

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