If you’re putting your fixer-upper on the market with an ad that says, “I’m selling my house as is,” you’re probably wondering how much you’re going to let it go for. Considering that you don’t have to talk to a licensed appraiser before speaking with your prospective flipper, it’s best to know the math for calculating the fair price.
While there’s no universal formula for valuating fixer-uppers with a mere inspection, here are the five things real estate investors consider when making an offer:
There’s no better to price properties for sale in “as is” condition than looking at similar properties on the market. Beyond the architectural style, flippers liken houses to others based on size and kinds of upgrades. It may not paint the whole picture, but it’s a good start.
Price per Square Foot
Second, investors find out the current price of residential properties in the area per square foot. Many variables go into it, but the flipper could shed further light on such major factors.
Although a flipper would buy your fixer-upper as is without involving a professional home inspector, you ought to disclose any damage you know. Trust is the foundation of the deal, and you’re responsible to proactively say every problem to the best of your knowledge.
Real estate investors have expenses of their own. While this is none of your concern, you have to take them into consideration to be a fair negotiator yourself.
Real Estate Market Climate
Lastly, flippers examine the latest real estate landscape to make deals that make sense for them over the long term. Currently, it’s still a seller’s market, which means there’s less property inventory available for all buyers. Real estate investors want to seize the opportunity to make as much money as possible. The increasingly fierce competition among them could work wonders for you.
Do your own research to prepare for lowball offers. No matter how bad you want to get rid of your fixer-upper, it pays to enter negotiation savvy to fight for a fair deal.