To repair or not before you sell
Our current economic situation might push some people to sell their primary or secondary properties in an attempt to curb their monthly expenditure. When you need to sell, you’ll also want to fully inspect your home, or have it inspected by a professional to identify all the defects and issues that might need to be fixed. The question now is, do you repair the defects, or do you lower your asking price?
Repairs and upgrades
There is a good argument to be made that certain upgrades can increase the value of your home and ensuring that the home is in good condition can go towards a higher asking price. Additions like a pool, garage renovations, custom luxury upgrades, quirky wallpapers, and permanent additions do not tend to add value. What does, however, is improvements to your kitchen and countertops, remodels to your bathrooms, basic improvements, and security and energy-efficient upgrades. These are usually long projects that you won’t necessarily do when you decide to sell the house. Normally, you would focus on just fixing what is already there. If there are any structural issues, damage to tiles or flooring, mould, a leaky roof, and a poor gutter system, these are things you would focus on.
When you do your home inspection, you can also get quotes for having the repairs done. Once you have the quotes, it is time to decide if the costs make it worth it to do them. If the cost of the repairs outweighs the benefit you will get from it, you might decide against it. For example, the repairs might cost a total of R20,000 but the home’s value will only increase by the same amount, you might not judge it worth the expense. If, however, the repairs cost you R50,000 and it pushes up the value and possible asking price by R100,000, you will be able to recoup your expenses and it is worth it. A well-maintained home will appeal more to buyers especially if they do not have the budget to buy and repair a home.
Other considerations
Choosing whether or not to do repairs does not just depend on the cost. If you have to sell the house as quickly as possible, the loss of time could outweigh the benefit of repairs. The repairs will need a bit of time to complete, and it could also be that once repairs start the contractors identify more that they have to do. This is not only a loss of time but more money that needs to be spent as well. If your aim with selling the property is freeing up monthly finances, the most important factor could be that you just don’t lose money in the sale of the house and if that can happen without investing in repairs, it could be worth it. Your asking price might be lower, but if you find a buyer that wants to repair and change the home to their liking, especially if the repairs are cosmetic and not structural, it might not be such a bad thing.
Final thoughts
To repair or not is a very important decision and various factors come into play. Regardless of what you choose though, it is vital that you inform all the parties involved in the sale of your home of all the defects you chose not to repair. It has been good practice followed by all reputable property practitioners to make full disclosures to potential buyers. With the Property Practitioner’s Act 2019 that came into full effect in February, it has now, however, become a legal requirement.
If you are ready to sell, get in touch with Karis. We can assist with a true and accurate appraisal of your property and how any repairs can affect the asking price.