You should not consider selling to an investor if your house is in great shape, unless you need to sell quickly. If your house is in good shape and you don’t need to sell quickly, listing it or selling it yourself would be a better idea.
Should I sell my house to an investor? Often we think of individual buyers or families as the typical buyers for houses. This has changed rapidly over the last few years and investors, or companies that buy houses are now making a large portion of the purchases of single family houses. Knowing if selling to an investor is key to making the right decision, as you shouldn’t always do so. In fact, sometimes selling to an investor may net you less money from the sale, other times it’s the best possible decision to make. Here’s how to tell if selling to an investor is the right decision for your situation.
Why you May Want to Sell to an Investor
- Often times sellers do not have to wait for conventional financing. Financing often delays the process of closing, and can significantly increase the time spent in escrow. Investors most often purchase using cash, meaning they can close quickly, or on the date of your choice.
- Investors typically do not care about the condition of the property. Investors often times are not planning on living in the house, so condition is usually never an issue. This can be very helpful if your property cannot qualify for financing.
- Investors are typically flexible on the terms of an agreement, where a typical buyer might not be. For example, closing date, condition, moving arraignments, etc… Most investors also do not care if you choose to leave items at the house.
Why You May Not Want to Sell to An Investor
- Make sure you do your research on the company or individual who is buying the house. Make sure they have some testimonials, or ask for a list of properties recently bought. Also, ask for referrals. Usually a real estate agent would do this work for you, but if you’re selling to an investor without a realtor doing a little homework upfront can go a long way.
- Most investors do not pay full market value for the house. This doesn’t necessarily mean it’s a bad deal. If the house is in bad shape you can end up saving money on realtor fees, escrow fees, closing costs, repair costs, and holding costs like mortgage, taxes and interest. Just make sure you have a decent understanding of the property value in its “as-is” condition. Also, make sure you understand that an investor needs to make a profit, while a regular home buyer does not.