A close friend is asking me about the "We buy houses" franchise and if they're legit. He doesn't have much equity. The home needs repairs that would exceed any equity he does have. And he says the whole family is sick of the home.
Are there other, non-traditional buyers of homes that work fast?
We've both only ever dealt with traditional realtors. Who here has gone down alternative home selling avenues? Thanks
No direct experience, but my understanding is their offers are very low. I got a bunch of mailings from them after my wife passed away. First one was after filing paperwork for probate, before I even got the paperwork back from the court. Friggin vultures was the impression I got.
I also have not dealt with, but my impression is they prey on scenarios of people who need cash right now and can't afford the time (or don't want to... estate settlement, etc.) to go through traditional sales paths and the hassle/duration that may bring. It's not that they're not legit, I.e. their check won't bounce, but they are opportunistic.
Even needing repairs, I'd imagine if he can afford the time, your friend would get more dollars listing it as-is via traditional means.
If it's in a reasonably competitive market, a lot of home sales can still be cash offers, or waived inspections. He wouldn't need to fix it up first.
My 88 YO Father-in-law called a postcard he got - we found out the night before. Exactly as described.
The guy looks it over and goes to his car for 15 minutes. Comes back with an offer exactly $75,000 less than that days "estimate" on Zillow. It wasn't like Zillow was $375,000 and he offered $300,000. It was like Zillow estimated $383,000 and this guy offered $308,000.
Will deduct money if Buyer guy has to clean it out but Father-in-law can just walk away if he wants.
I've heard a lot of these contracts get resold before the closing date to another buyer so the original guy really only mails postcards and gets the first contract.
We made my father-in-law pass and he still is hacked at the wife and I.
Here's my impression of how it works around here...
You price a house at what it's worth in "done and complete" condition. That means you do not factor in deferred maintenance or needed repairs into the price.
Due to low inventory, the house then sells for this high price even though everyone knows, as an example that is needs a $15k roof.
Said another way, price the house at "done and complete" and let others tell you (offer you in their bid) how much less it should really sell for.
Around my area you have to sell your house for "all the money" because buying another house is going to cost you "all the money."
My uncle passed away and his house sat empty for a decade or more as my cousin and his siblings couldn't get it sorted between themselves. Finally push came to shove ....animals had gotten in, there was water damage in some parts and it needed "everything', including cleaned out. He contacted some estate sale types who came in and bought everything of any value - which wasn't a whole lot - and then he called three of these guys who advertise in our area.
All three gave bids for the house as is, didn't have to clean anything or remove anything. He took the best of the three and they brought over certified funds. Done.....for quite a bit more money than I ever thought it would bring....
A month later the house was on the market and sold for a significant amount of money. I could not believe how quickly they turned it around as it needed a complete gut, roof, paint kitchen and bath remodels etc......
These are all great thoughts. Thank you!
The we buy houses is a private equity scheme. PE is all about quick money. Either selling assets or a turnable/flippable product. If it doesn't sell immediately for stupid money, with minimal rehab, they'll rent it for stupid money. Just follow the cash flow.
Guy next door sold his house to one of them. He just wanted to sell it and move to something smaller. I would have considered buying the house at the price he sold it at to the we buy houses people. The flippers did have to put a new roof and other maintenance items, and sold it for over 100k more.
So the houses are sometimes flipped, but around here what I see a lot of is them getting turned into rentals. And every rental is keeping the inventory for homes to buy low pushing up prices and preventing the next generation from having a crack at the "American dream" of homeownership. (And the attendant generational wealth that "can" build)
Vultures. berkeley em.
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