February 21, 2023

Selling a House in Poor Condition

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Selling a House In Poor Condition

Selling a House in Poor Condition

If your house has major damages due to old age or unfortunate circumstances such as flooding or fire, you may feel pressured to make repairs when you sell in the traditional market. While it's true that newly renovated houses sell faster than fixer-uppers, there's still a market for houses with very poor conditions.

Generally, you have three major options when selling a house in poor condition: sell as-is to a cash buyer, make cosmetic fixes, or make major repairs and sell with a real estate agent. Among all these, selling to a cash buyer is the fastest and most hassle-free because you don't need to make any repairs.

Eager to learn more about selling a house in poor condition? We got you covered! Check out the rest of this blog to learn more about selling such a property.

What Does a House In Poor Condition Mean?

What Does a House in Poor Condition Mean?

When a house is in poor condition, it is typically below standard. These houses often need major updating because they are too old, they have a lot of damage, or they are almost uninhabitable.

The meaning of "poor condition" varies from market to market. Thus, a house that is already for demolition and a property that has minor cosmetic issues can be tagged as houses in poor condition in an inspection report.

These houses are also harder to sell in the seller's market. Many buyers who take interest in these properties buy them at a very low asking price. 

Categories of Houses In Poor Condition

What Does a House in Poor Condition Mean?

Real estate professionals have broken down houses in poor conditions into a few categories to help homeowners identify the current state of their houses. In most cases, this categorization also becomes the basis if the house should be sold as-is or if it should be repaired before selling.

House is Uninhabitable

A house that is uninhabitable has many issues or damages that make it unsafe to live in. Mostly, these issues are related to health and safety. 

Here are some indicators that a house is uninhabitable:

  • Serious plumbing problems including leaky pipes, broken water heater, etc.
  • Major electrical issues such as frayed wiring and grounding issues
  • Black mold
  • Lead and asbestos that can't be removed
  • Broken heating, ventilation, and air-conditioning (HVAC)
  • Severe roof damage
  • Termite infestation and termite damage
  • Major chimney damage
  • Major foundation issues

House Needs Major Repairs

A house that needs major repairs is still livable; however, the issues should be fixed so they do not pose any health and safety risks.

Here are the signs that your house needs extensive repairs:

  • Minor electrical issues
  • Minor plumbing issues
  • Visible foundation damage
  • Visible roof damage
  • Wood rot
  • Outdated/damaged bathroom
  • Outdated/damaged kitchen
  • Failing HVAC
  • Light fixtures and faucets that aren't working
  • Damaged flooring

House is Outdated

An outdated house is a structure that has been built many years ago; hence, some of its features need to be replaced or fixed.

Check out these indicators that your house needs to be updated:

  • Outdated bathroom
  • Outdated kitchen
  • Wood rot
  • Peeling paint
  • Non-functioning and outdated light fixtures and faucets
  • Overall weathered interior and exterior

House Needs Cleaning

Among all the categories of houses with poor conditions, this is the easiest to deal with. You only need to do some deep cleaning and the property will look very much livable.

Here's what a house that needs cleaning looks like:

  • The landscaping is untended, overgrown, or dead
  • The flooring is dirty and stained
  • There is too much dirt and clutter everywhere

A hoarder house is a common example of a property with deferred maintenance.

Common House Damages That Need Repairs

Common House Damages That Need Repairs

To better understand the categories we discussed above, we should look into the most common house damages that need to be addressed immediately.

Water Damage

Water damage is typically caused by severe weather conditions, clogged gutters, AC condensation, leaking pipes, water supply leak of a washing machine, problematic sprinkler system, blocked drains and leaking water heater. So far, this type of damage is one of the most expensive to repair and also the most common.

Fire Damage

Fire damage is categorized into three— flame damage, smoke damage, and third-party damage. 

Flame damage can be caused by a naked flame or serious electrical issues. Smoke damage, on the other hand, is caused by the lingering smoke after the fire has been put out. Usually, it discolors the surfaces of the property. 

Aside from the two mentioned, some other factors (3rd party) can cause damages during a fire. For instance, the water used by the firemen to control the fire may end up swelling and warping your walls.

Foundation Damage

Foundation damages include bowing foundation walls, crumbling foundations, house sinking or settling, house shifting, and minor foundation cracks. Structural foundation repairs are quite expensive but it also greatly affects the resale value of the property.

Mold Problems

Mold problems are caused by moisture in your home. Molds usually grow in the bathroom, on the roof, on windows, and in areas that experienced flooding. When inhaled, mold spores can cause allergies and in the worst cases, cancer.

Termite Infestation Damage

This primarily targets houses that use wood. Termites are insects that tunnel inside the wood and make many parts of the house hollow. In some cases, termite damage appears like water damage.


Asbestos is a heat and flame-resistant material that was used in building many houses until the 1970s. It was, later on, discovered that it can cause respiratory issues and cancer. Houses with asbestos can be considered houses with poor conditions since removing asbestos is very risky.

Can You Sell a House in Poor Condition?

Can You Sell a House in Poor Condition?

Yes. You can sell a house in truly poor condition even without making repairs. Note, however, that your buyer pool is significantly reduced if you list in the real estate market since many traditional buyers are after move-in ready homes. 

To see a successful sale, many homeowners sell poor-condition houses to a cash buyer or real estate investor. These types of prospective buyers pay in cash and they do not require the owner to make extensive repairs. 

It is still possible to sell traditionally with real estate agents, but the risks are higher and it could take time, not to mention you won't be able to set a very high asking price. 

How Do I Know if It is Worth Making Repairs?

How Do I Know if it is Worth Making Repairs?

Before putting your house on sale, you should first decide whether to make repairs or not. This isn't an easy decision to make since it will impact how much you'll profit from the sale.

Here are some of the factors you should consider before deciding to make repairs.


Browsing your LMS or personally looking at the houses in your neighborhood that are for sale will tell you if it's worth making repairs. 

To illustrate, if your competition are all updated houses, (they have great curb appeal, they are freshly painted, they have new flooring and roofing, etc.), it would be difficult to sell as-is. It makes more sense to make repairs so your property will get noticed.

Meanwhile, if your competitors are an assortment of houses (some are renovated, some underwent minor fixes, and some are sold as-is), you have a better chance of selling your home without making any repairs. 

Market Conditions

The current market condition is another major factor you should consider when deciding to make repairs.

If it's a hot seller's market where property prices are higher and more buyers are competing to buy houses, you can get away with making fewer repairs or no repairs at all. 

On the other hand, if it's a buyer's market or a slow market, the sale would be painfully slow unless you make major repairs. 

Knowledgeable real estate agents can help you identify these market conditions.

Return of Investment

To identify whether making repairs will give you some ROI, you should list all the repairs needed by your home. If it turns out the repairs needed by your home won't really increase its market value, then it is better not to make repairs at all.

A great real estate agent can help you determine which repairs can improve the value of your property so be sure to ask them about this.

Inspection Results

If you're already aware of the major repairs needed because you conducted a pre-listing home inspection through the help of a professional home inspector, it may be better to deal with them before putting your house on sale.

This is so the buyer can't use the home inspection report as a bargaining card during negotiations.

How to Finance Repairs for a Home in Poor Condition?

How to Finance Repairs for a Home in Poor Condition?

If you decide to repair your home in poor condition, you don't necessarily need to spend your savings or emergency fund. You can take out a loan to finance the repairs. Here are some of your options. 

Home Equity Loan

Home equity loan also called a second mortgage and home equity installment loan, allows the homeowner to take out a loan against their home's equity. The amount of the home equity loan is based on the difference between the home's value and the remaining mortgage balance of the owner. It is given through a lump-sum payment. 

You can pay a home equity loan within five to 15 years and there's an agreed-upon interest. It will remain the same over the loan's lifetime, in other words, there is less payment flexibility.

Your home is also the collateral for this loan so if you fail to pay, your house would get foreclosed.

Home Improvement Loan

A home improvement loan is considered an unsecured loan that you can use to make repairs or upgrades to your property.

Unlike a home equity loan, your home is not collateral for this option. You can only qualify for this type of loan if you have a good employment history and your credit scores are great.

Funding comes quickly for this loan so many homeowners prefer this over the other options.

Home Equity Line of Credit (HELOC)

A home equity line of credit (HELOC) also borrows from your home's equity but it works more like a credit card. It is tagged as a revolving line of credit because you can borrow again once you've paid your previous loan within the short repayment term.

HELOCs usually have a variable interest rate so it offers more flexibility, unlike home equity loans and home improvement loans. However, failure to pay would also lead to the foreclosure of your home.

To check out some other options in financing repairs, check out this blog.

How to Sell a House in Poor Condition

How to Sell a House in Poor Condition

Selling a house in poor condition is definitely challenging. There are a lot of hoops you have to go through, especially when selling the house as-is to the local market. To help you decide which route to take, let's explore all your options!

Sell the House As-Is to Real Estate Investors

Selling as-is to real estate investors or cash buyers has got to be the fastest and easiest option when selling a house in poor condition. For starters, these buyers can pay you with cash, eliminating the need for mortgage lenders which could delay the sale. 

They also don't require repairs before they close on the property. They handle all the repairs so you don't have to take out any loans or deal with a home inspector.

Selling the house as-is to real estate investors has other benefits including:

  • Faster Sale: If you need to relocate to another city immediately and sell your house in bad condition to fund your move, you have more chance of a successful sale with a cash buyer. Cash sales close fast because you aren't waiting for a buyer's loan approval. They can pay you straight out of their bank account making the transaction relatively fast.
  • Less Risky Sale: A cash sale is less risky because there aren't strict requirements that should be met by the seller just like in traditional sales. Since there are no lenders involved, there are no loan rejections. Once the cash buyer or real estate investor has put in an offer, they rarely back out of the sale.
  • Less Paperwork: Removing the mortgage lender from the picture significantly lessens the paperwork of a cash sale. Most of the paperwork is processed online and the cash buyer takes care of them.
  • Flexible Sales Timeline: Sale timeline flexibility is not possible when you sell to the local market. But with a cash buyer, you can even set your moving out and closing date! Whether you want to close in as fast as seven days or in two months' time, it is very much possible.
  • No Appraisal: Professional appraisal is a bit expensive but luckily, there is no need for this when you sell to a cash buyer. They'll do market comparisons for recently sold homes and give a no-obligation cash offer based on their assessment of your property.
  • No Inspection: Although the cash buyer would visit your home to put in an accurate offer, the inspection is not similar to traditional sales. Even if there are major issues discovered, the cash buyer won't ask you to finance the repairs.
  • No Negotiations: When you sell to a cash buyer, there would be no multiple negotiations regarding the sales price since you are only dealing with a single individual/company.
  • No Commission Fees and Closing Costs: There is no professional real estate agent involved when selling to a cash buyer. This means you don't have to pay an expensive real estate agent commission fee. As for closing costs, the cash buyer will pay for them.
  • No Marketing and Showings: Since cash buyers are "sure" buyers, you don't have to do any marketing or schedule showings just so they'll give you an offer. Remember that these buyers are interested in houses no matter how poor their condition are.

Selling your house in poor condition to a cash buyer is relatively easy, especially if there are no outstanding tax liens, delayed house payments, or other financial obligations involving the property.

Here are the general steps in selling a house to a real estate investor or a cash buyer:

  • Get a Cash Offer: Go to a cash buyer's website and fill out a form or call them personally.
  • Home Walkthrough: Welcome them to your home for inspection so they can make an accurate offer.
  • Set a Move-Out Date: Communicate when you plan to move out or close on the property so they can process the sale according to your timeline.
  • Review and Sign the Contract: Review the contract they'll send electronically. If you have questions regarding the terms, you can ask them. If all is good, you can then sign the contract and send it back to them.
  • Closing: During closing, you'll be signing some paperwork to transfer the deed into the cash buyer's name. After this, you'll get your money in your bank account.

Make Cosmetic Fixes and Low-Cost Repairs

Making minor cosmetic repairs and other low-cost fixes can help attract more potential buyers and possibly increase the value of your home.

The great thing about these cosmetic repairs is that you can DIY them and they don't take too much time. There's really no need to call a contractor and the repairs won't delay the sale.

However, it is important to note that not all low-cost repairs can actually give you an ROI. Also, even if you DIY the repairs, you would still spend some amount of money. 

To illustrate, here are some of the minor fixes you can do and how much they would cost:

  • Faucet Replacement: $254
  • Replacing Outdated Light Fixtures: between $152 and $901 per fixture
  • Refinishing Existing Cabinets: $350 to $910
  • Home Interior Repainting: $1 to $3 per square foot or $1,000 to $4,000 on average for the whole interior
  • Carpet Replacement: $700 to $2,000

Another problem when making minor repairs and cosmetic fixes is that there's really no assurance that the buyer would like them. For instance, removing peeling paint and painting the walls blue or darker color may even throw off some minimalists who are after lighter colors.

Nevertheless, if you've already set your mind to go this path, you can still end with a successful sale if you set a realistic asking price, you don't downplay the negatives but you highlight the positives of your home, you make concessions, and you patiently wait for the right offers to come. 

You can't really rush a traditional real estate transaction especially if you only made minor fixes.

Make Major Repairs and Sell With a Real Estate Agent

Making major repairs and selling with a real estate agent who is experienced in selling houses in your area is the best route if you want top dollar for your home. If you choose this option, you would go through the selling process of a typical traditional sale in order to attract more potential buyers.

You don't really have to repair all the major issues of your home if you cannot afford to, but this article suggests the most important things to fix. You should only prioritize repairs that don't meet building codes and ones that are proven to increase home values like fixing significant foundation issues, replacing the damaged roof, fixing the septic system, dealing with minor wood rot, etc. 

If your home is just outdated and you're looking into making some home improvement projects to gain more prospective buyers, you can prioritize the following:

  • Entry door and window replacement
  • Siding replacement
  • Kitchen remodeling
  • Garage door replacement
  • Replacement of heating and cooling systems
  • Enhance curb appeal through landscaping

These repairs, however, are super expensive. They can range from a few hundred dollars to a few thousand dollars so you must plan which ones can really boost the value of your home so you can set a higher price.

Once you have made the repairs, you can then sell the house in the local real estate market. This would involve planning a marketing strategy with your real estate agent, staging your property, taking professional photos, writing a listing description, setting a decent price, scheduling open houses and showings, negotiating, and more. 

Making major repairs when making traditional real estate transactions can take a while so if you really need to sell your house fast, this isn't the best option.

Final Thoughts: Selling a House in Poor Condition

Selling a house in poor condition can cause you a lot of stress especially if you sell in a slower market. You have to decide whether to sell your house as-is or make repairs and both have their consequences.

If you really want to skip all the hassles of making repairs, sell to a cash buyer. This way, you also get to sell fast— ideal if you're moving to another city or you need immediate cash.

Once you are ready to sell your house in poor condition, reach out to us at House Buyer Network. We'll give you a fair cash offer and even cover your closing costs!

Fill out our form below or call us at (855) 835-2544 to start selling your house in poor condition.

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catherine mack
Author: Catherine Mack

Catherine Mack is a seasoned real estate investor and enjoys sharing her expertise through writing on relevant real estate topics. Catherine aims to educate home sellers, so they can make the best decision for their real estate problems.

She’s been featured on a plethora of publications including Better Homes & Gardens, Acorns, Realtor.com, Apartment Therapy, MSN, Yahoo Finance, HomeLight, and Business.com.

House Buyer Network™ since 2004. We buy houses nationwide. As house buyers, we offer cash for houses to homeowners looking to sell their house fast. Our cash offers are free and come with no obligations. See what we can offer and get cash for your house!

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