Home Selling in 29646>Question Details

Kmcc, Both Buyer and Seller in 53593

We have a small home in McCormick on a double lot to sell. It is either a fixer upper or a tear down. How do we decide the best approach?

Asked by Kmcc, 53593 Sat Sep 3, 2011

We do not have alot of cash to put into it and live out of state, so doing the work ourselves is out of the question.

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I lived in McCormick years ago (late '80's) working in the state parks, now perform real estate investing.

First, you should determine what your needs are in selling- sellers all have different motivation, and money is not necessarily the real requirement. Don't be caught up in not meeting your needs due to family or friends saying "I wouldn't sell it for that." If you don't want to, or can't make additional tax, utilities, repairs, etc., don't feel 'wrong' because you let it go at a price to sell.

Being from out of state, you should determine how much time, energy, etc. you want to put into this vs. getting a cash deal from an investor, who will close quickly. Investors typically work in two different ways; it's either a rental or retail

If it is in a retail area (no or very few rental areas):

Call Sally (below) if you haven't already , and ask her to pull some comps for you. McCormick Co. website does not have the ability to pull these based upon sales. She should be able to give you a fairly strong figure. After you know what the value should be AFTER it is move-in ready (fixed up and may only need paint), take 60% of that and then subtract the $ repairs required. In other words, if fixed up it's worth $100k, take 60% to $60k and subtract repairs (say $20k) and an investor will pay you $40k cash, usually within a couple of weeks. This may seem low, but if you factor the increased tax rates, insurance, holding costs, potential investor costs, capital gains tax, etc. and the fact avg. sell is six months, there is little left after six months worth of work (less than minimum wage). The investor takes the risk of tying up a lot of funds for an unknown period of time.

If it is a rental area, then the formula is even easier; get an idea of how much rent rate would be per month, multiply by 12 (for a full year), multiply by .6 or .7 (this allows for vacancies, repairs, taxes, insurance, etc). DIVIDE that number by .15 or .2 (capitalization rate) and you will get the approximate value an investor will give for the property. Example: Rent rate is $600 per month x 12 = $7200; $7200 x .7 = $5040; $5040/.15= $33,600 (sell price). The retail value is of no significance in a rental situation.

You can also do a 'Contract for Deed', which you basically do a seller finance- maybe someone who will buy and fix up for themselves. Buyer beware- get a good sum of down payment, in the thousands.

I would suggest you get with Sally either way, since she should be more familiar with the market. You can also contact me with questions to follow up at 864-660-9009, or my website at http://www.sellmyupstateschome.com. I am heading in that direction on the 16th, and maybe able to drive by and take a look at for you (obviously no commitment on your part, as I do not know that area).
0 votes Thank Flag Link Tue Sep 6, 2011
As suggested, you need a professional to evaluate your home in McCormick.
The evaluation should result in determining what, if any,financing the home will be eligible for the prospective buyer.

Now that the prospective buyer pool is identified, analyze the competing homes. If, for instance, your home has significant deferred maintenance or safety issues exist, your buyer pool will be cash only. These buyers have a formula for determining what they will offer for your home. Have your real estate professional discuss these issues with you and reach an agreement regarding your lowest acceptable offer and how this compares with the offers that are most likely to be presented based on their calculations. Compare the numbers. Is a sale possible?

Now, your real estate professional can market your home in both the residential real estate to cash only buyers and in investor arenas as a 'knock down.' You would be wise to inquire about your real estate professionals exposure to closed or private investor communities.

In response to your question....do both through different marketing channels.
0 votes Thank Flag Link Sun Sep 4, 2011
Those are questions a Realtor could help you answer based on the location of the property in McCormick, the condition of the house, or the probability of selling the land by itself. There is no way to answer the question factually without first seeing the property. If you would like a professional opinion of value and advice on what is the best way to market the property in order to sell it for the highest price possible. Call me at 864-344-1728 I would be happy to help you.
0 votes Thank Flag Link Sun Sep 4, 2011
I would first find a good agent to assist you in determining how you want to sell. He/she should be able to pull comparable data on homes that are currently for sale and homes that have sold in the past six months. Look at pricing on homes that are turn-key and/or move in ready and then look at pricing with respect to homes that are "fixers." You should be able to find a list price that fits your unique situation. Typically, if you list as needing TLC, you will get more action as many buyers don't mind a little elbow grease to make it the perfect home. If you list as a tear down, you will be limiting your buyer interest to primarily contractors, investors, etc. unless the property is located in a highly desirable area where homes are typically high-end and a buyer can see the value of the land, verses the value of the home.
0 votes Thank Flag Link Sat Sep 3, 2011
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