How to sell a house that needs repairs (Ugly house)

How to sell an ugly house


Selling a house is difficult, selling a house that needs a lot of work is nearly impossible unless you know how to target the right group of buyers.   The price point is irrelevant, I have personally helped individuals sell houses priced anywhere from $5,000 to $1,280,000.   If the house needs major repairs it is unlikely to sell through the traditional MLS or Multi-list system.

The first problem that you encounter with a house that is not in livable condition is that no bank on earth will give anyone a mortgage to buy the house.   This is a huge problem.  Even if you house is only worth $10,000, you can only sell the house to someone who has $10,000 in cash and is willing to dump their own money into the house repairs.  There are not a lot of people who fit this description.  Buyers who fit this description will either be real estate investors or handymen who think they can rehab the property slowly over time while they live in the house.  I can tell you from experience that the handymen aren’t always up to the task, and sometimes you get the house back in worse condition than when you started.

Another thing to consider with the ugly house is the potential liability.  Many of the ugly houses that real estate investors buy from those “we buy ugly houses” signs are actually vacant houses.  Vacant or abandoned houses are an extreme liability for the homeowner.  I have seen several incidents where a thief has sued a property owner for an injury that occurred while the thief was in a house to steal the copper pipes.   Even when the homeowner successfully defends this frivolous law suit, the lawyer bills can be fairly expensive.

If you choose to go the handyman route to sell an ugly house, you need to have a very detailed contract that specifies how and when all repairs will be made.  You also need to have a lawyer on call to make sure that you are protected in this transaction.

On the other hand, a real estate investor is much better suited to buy a distressed property and return it to good working condition.  For one thing, real estate investors are really good at turning derelict real estate into performing assets.  I know the TV shows like Flip This House make that process look so easy that anyone can do it, but I assure you that the truth is much more complicated.  In general it takes a fairly seasoned real estate investor to know how to bring a vacant house back to life.

One of the best techniques to sell an ugly house is to sell that house on payments.  There are a number of legal ways to sell a house with payment terms and the laws vary state to state.  The mechanics of this transaction need to be handles by a real estate attorney (general practice attorneys are useless here); they will use legal documents like land contract, lease options, lease purchase, wraparound mortgages, and all inclusive trust deeds.  Don’t worry about what sort of document to use in your state, just let the lawyer handle that part.  The important part for you is to make your property easy to buy.  Making a property easy to buy is the best way to sell it.  What you need to consider is that your buyer will need to dump additional cash into the property after they buy it.  If you sell the property and take monthly payments for your equity, you can actually get more money for your house.  For example, if you are selling a $35,000 house at $350 per month, what you have really done is you have freed up your buyer to be able to use their limited cash to rehab the property.  This in turn will allow them to either resell in the case of an investor or get a mortgage.

So how do you find an investor to sell your house too?  Well, you can either drive around until you see a “we buy houses” sign, or you can contact your local real estate investors club. Trust me; every decent sized city has at least one of these clubs.   If you happen to live in Pittsburgh or even in Western PA, Eastern OH, or Northern WV, then I can help connect you with a buyer directly.  Just email me at

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