When selling, is it better to make the repairs up front or to give the buyer an allowance? I’ll answer that with a great example today.
When selling your home, should you make the necessary repairs before listing or give the buyer an allowance to do them after the home is sold?
Let’s say you have carpet in your house that is 10 to 15 years old. You know that either you or the buyer will need to replace it, but who should do it? It really depends on your goals. If you absolutely do not want to do anything to your home, you can sell as-is and offer a carpet allowance. That way, the new owner gets to pick out whatever they want.
That’s an alright option, but you need to understand that most homebuyers who are looking for a house want the home to be move-in ready. If you offer an allowance, you will limit yourself to a certain buyer pool who wants to make personal improvements to a home. Those types of buyers are typically going to look for a discount on the property as well.
If your goal is to have the most money in your pocket after you sell your home, the best option is to replace the carpet before it goes on the market. It will cost you more up front, as you need to pay for the carpet, but there are vendors who will work with you on the cost of the install. In some cases, they won’t charge you for that until after the home closes.
When you replace the carpet up front, the house is going to show better. When the typical buyer sees your home, there is a much higher chance that they will see it as a well taken care of, move-in ready home. This will create an emotional attachment to your home, making them more likely to not only buy your home but also pay more for it.
If you have any other questions, please feel free to give me a call or send me an email. I look forward to hearing from you!