Should I list my inherited house with a real estate agent or sell it to an INVESTOR?
Which one should I do?
That’s a great question. Hi, I’m Brad with ProbateResource.com and ArborViewHomeBuyers.com. We specialize in real estate solutions for probate and inheritance properties. With years of experience and expertise in this niche, we’ve purchased hundreds of properties and have the skills to handle these sensitive scenarios.
So, the question is, should I list my house with a real estate agent or should I opt for a cash offer from an investor? This is a great question, and I can provide the best answer because I am a licensed real estate agent in Georgia and also an investor who buys houses for cash.
We often deal with this dilemma: what should I do? The answer lies in what you value more – money or time and peace of mind.
Current State of the Housing Market
If you prioritize maximizing every last penny from a property, then it’s advisable to make necessary repairs and updates. However, the market has undergone significant changes in the last few months. As of November 2022, there’s been a decline of around 10% from the peak prices. The market reached its peak around May or June and began declining in July or August.
Market Shift and Impact on Sellers and Buyers
In the past, you could make about 10% more profit when selling a house without having to make any renovations. The housing market was so hot that almost anything would sell. However, things have changed now. The market has shifted and people are more selective because of the higher interest rates. As a result, there are fewer buyers, and fewer people are willing to sell their homes. With interest rates now at 7% or even higher, homeowners with low interest rates like 3% or 4% are hesitant to sell and take on a new mortgage with higher rates. As a result, they are choosing to stay put, leading to an interesting situation in the market.
I believe this is why prices haven’t dropped more than expected. The scenario I described is the reason they haven’t fallen further. Supply was already low, and now it’s even more limited. I’ve been closely monitoring the data every month, and the supply is shrinking. However, the days on the market for existing inventory and prices have decreased because people are eager to sell. Properties are lingering on the market, and we are no longer seeing multiple offers or selling above the asking price in a matter of hours. Last year, in 2021, I sold my house without even listing it. I received an offer before putting it on the market, and we sold it for top dollar without having to go through the MLS listing process.
The days of having limited options are behind us. We are now in a more typical market similar to what we experienced in 2018. In the current market, buyers are more selective. It’s still a seller’s market, but buyers are being choosy. They are requesting closing cost contributions and being particular about repairs. They have options now, so they’re being very discerning about their purchases. As a seller, it’s important to present a high-quality product.
Importance of Pricing and Presentation
If you have a good product, are making necessary repairs, and are listing with a good real estate agent, you’re on the right track. Many real estate agents entered the market during the hype of the past few years and bragged about selling houses for their customers. However, the truth is that the market sold those houses, not the agents. Good real estate agents are worth the investment. It’s important to list the house, make necessary repairs, be prepared to offer concessions to buyers, and ensure that you’re presenting a high-quality product.
It’s crucial to have a good product and price it accurately in the current market. In the past, many people would set very high prices and hope for the best, but now pricing is essential. If a house isn’t priced right, it will just sit on the market. We’ve found that when we price our properties correctly, they sell quickly, often with multiple offers within a week or two. Currently, the average time on the market is about 15 days, with the shortest time being 7 days during the peak of the market in the last few years.
Choosing the Right Selling Strategy
But average days on the market around 15 days, you just have to price it and it’ll sell. But if you’re okay doing that, that then you need to absolutely list it with a real estate agent. If the house doesn’t need a lot of work, it’s not in disrepair, it’s in good shape, it’s in a good area, and it’s priced right, it’ll sell. You just have to be patient. But if you don’t mess, want to mess with any of that, maybe you have a house that’s in disrepair, maybe you just don’t want to mess with it, you just want this sale done quick, then the investor route is the best route for you. I also want to preface this. Sometimes we get people that come to us who want to list it with an agent, but the house needs a lot of work. It’s in disrepair. There’re certain things you have to look at.
Is the house lendable by a bank? Is a bank appraiser going to come to an appraisal and say, “Yeah, we don’t want to loan money on this because the roof needs to be replaced and this needs to be fixed and this railing’s broken and there’s some life and safety issues and blah, blah, blah, blah, blah.” Plus, as this market is changing, a lot of the buyers are shifting to FHA financing. And FHA is a lot pickier about maintenance and repairs and things with the property. So you need to make sure that if you have a property that needs a lot of work, what you’re going to find is if you list it out on the market with an agent, your only offers are going to come from investors. The guys over here and guess what’s going to happen? They’re going to offer you the same amount of money as you would have gotten from just selling to an investor over here, but now you have to pay a real estate commission to the real estate agent to get you the same offers that you would’ve got over here.
Benefits of Selling to an Investor
So really, you’re going to make less money. And we are going to be honest with you as a company, and we’re going to tell you, “Hey, this house needs a lot of work. You can list it if you want, but it’s probably a better idea for you to take an investor offer and just have them go ahead and buy it and take it off your hands.” Because I just want you to make the best choice that’s good for you. Obviously, I want to buy the house and make some money off of it, but if I try to list a house for you at an unrealistic price to the market and an unrealistic offering to the market, we’re only lying to ourselves if we think it’s going to sell. So a lot of times what we find is if a seller wants to sell a price for some ridiculous price that I don’t think is accurate enough for the market, I’m going to tell them.
We may not be the best fit, and if you decide to work with another agent who promises to sell your property but fails to do so, it will be a waste of your time and theirs. We believe in being upfront and honest about whether we think we’re the right fit for selling your property. Ultimately, the decision is yours. Selling a property you’ve inherited can be a tough decision, and there are many factors to consider. If you have a property that you’ve inherited and need to sell, we’re here to offer our expertise. Feel free to contact us through our website by filling out a form or by calling us at GeorgiaProbateResource.com or ArborViewHomeBuyers.com. We’ll ask you some questions, evaluate the property, and provide our recommendation for the best approach. Ultimately, the decision is yours. We hope this information is helpful. Thank you, and have a great day.