Friday, May 5, 2017
Fixers are still tougher to sell...
Investors are not interested in paying top dollar for fixers. They tend to pay cash so they don't have to worry about lender guidelines and soft appraisals. But they want to "steal" it so they can turn a profit. That is the whole idea around the investors approach.
Sellers with pie in the sky dreams of getting full market value for their fixer as much or near what the neighbors fully restored and remodeled house just sold for, are going to get a kick in the teeth by the cold hard realities of a market that really wants clean move-in ready homes.
That said, fixers will sell. The market just wants to pay a little less for a home that needs a lot of work. These tight inventory conditions allow sellers to get 85-90% of the relative market value for a clean, move-in ready example of their home and that is a big bump up from a few years back when fixers were fetching only 50-70% of relative market value.
Additionally sellers need to be aware that functional obsolescence is still a thing even in a hot seller's market. One bath homes are not going to yield the kind of offers that a comparable two bath house will get. It may even shock people how much that second bathroom is worth to a great many buyers. Of course a third bathroom doesn't have as much extra "punch" as a second so worry not if you have two.