You’ve seen the signs at almost every street corner or off-ramp, “Cash for houses in Kansas City.” Some of these are cartoonish signs and others might even be handwritten, nailed to a light pole. Some cash for houses signs makes claims they buy houses in any condition and for competitive rates and all cash.
If you need or want to sell your home, a “Cash for houses in Kansas City” buyer might be the perfect solution to sell quickly without the headaches of preparing a property for showing.
Is Cash For Houses In Kansas City Right for You?
The Cash for Houses Buyer
The people putting up these signs are Kansas City homebuyers seeking a certain type of home seller. They seeking the home seller that for a variety of reasons do not have time or money to fix up the property, list it with a Realtor, wait for the right person to make an offer and then work their way through inspections, inspection repairs, appraisals and the whole process. Typical home sellers might include those who own two houses, accidental landlords tired of dealing with poorly selected tenants, people who have inherited a home. People divorcing. Or people with homes that need a ton of major repair. They could also be facing bankruptcy, foreclosure, medical issues or a tax sale.
By placing the signs out there on the street or placing them virtually on the internet, these investors are working to get their message in front of the right seller so they will call.
Note that some people putting out these signs have just started their home buying career and others, like the Tuckers here at kcmoHomeBuyer.com, have been buying houses for many years.
The Thoughts Process Behind the Offer
There are typically three ways the people putting out the signs might buy your property.
- All Cash in 60 to 90 Days: This type of investor if they have been in business for a while have a list of their own cash buyers. They are working to find a seller who needs to sell quickly so they can get the house under contract. Then they are going to sell that contract to their pool of cash buyers. This is a good way to go if you have an experienced buyer, but there are quite a few brand new buyers out there who have no idea what they are doing and have no buyers. These brand new investors are highly likely to back out at the last minute. Find out how long they have been in business, how many houses have they bought, and what if they can’t find an end buyer?
- Buy on Terms: This type of investor is going to offer probably the highest price for your property. But in exchange, they may want to take over your mortgage payments or have you offer some sort of seller financing. If you don’t need the cash out of the property, or you want to string out a profit on the sale of a home over a few years for tax purposes, this could be a great way to sell your property. But again, you want to know more about the person or company buying your house.
- All Cash, Quickly: This is typically how we buy a house. The one in the photo above on Harrison in Kansas City, Missouri, for example. We looked at the house on July 16th. Negotiations took a bit of time and we finally came to terms and had a written purchase contract on July 18th and we are closing on July 31st. About 15 days from start to finish.
Note that because most investors are acting quickly, saving the seller from the cost of repairs, paying a realtor, the time spent with the home being shown (hopefully) to a bunch of qualified buyers, then once you find a buyer the 45 more days it takes to have the home inspected, to renegotiate the sale price and the repairs that you as the seller will make to the house. And then: the appraisal and the loan. Many times a home seller is 3 or 4 months down the road and the appraisal comes in too low and they are left to decide if they want to lower their price or start all over.
Fourth Option: Realtor looking for a motivated seller. Some “Cash for Houses” buyers out there are Realtors. Here at kcmoHomeBuyer, we are all licensed Realtors and that gives us the ability to make a 4th offer. List It As-Is, and market it to cash buyers. This is an option usually comes into play when the seller does not want to do any work to the house but has a bit of time to wait for the marketing and sale of the home. The home will not sell at full market value because of needed updates and you will have a Realtor commission to be paid. But because of the flexibility of time to find a buyer, you might find one who can pay more that may be paying cash and maybe getting a loan.
Consider Your Position Before Negotiating
Keep in mind there is a cost to keep a home. Everything from mortgage payments, insurance, and property taxes must continue to be paid while you own the home. The longer you delay a sale, the longer you must pay for utilities, maintenance, and upkeep.
If the home is vacant, there are even more worries. Do you have the right insurance that covers vacant homes? What happens if a pipe bursts or someone breaks in. Who is going to drive over and check on the house regularly to make sure the doors are locked and everything is ok.
Do the math on what your holding costs are, then consider the average time it takes for homes to sell in your market. Based on average pricing plus a 5 to 6% Realtor Commission, will you make up the difference in the cost of maintaining the home for the extended timeframe?
It may also be urgent to sell because of an impending foreclosure or estate tax cash requirement. Consider all of these factors as you begin to look at offers from buyers.
Maximizing the Sale Value
It doesn’t take a lot of research to get an idea of a property’s fair market value. If you really want to know, pay a couple of hundred dollars for an appraisal or simply speak with a local Realtor who will give you an idea of the value of your home in its current condition.
Once you know what the estimated value is based on current market conditions, look at what can be done quickly and inexpensively to improve the property thus increasing the value.
Make sure it’s decluttered and clean. Make sure windows and screens sparkle. Remove all weeds in the landscape and trim trees and bushes back. Replace carpet, tile the bathroom and kitchen and repaint the inside and out.
If you have a bit more time and money to invest, update the kitchen and put in new appliances. Update the bathrooms. Possibly replace some big-ticket items like the furnace and air, the roof, or windows and doors. You don’t need to do this, but if you have the time and money to do so, it might be worth the investment.
The bottom line is if you can extend your timeline of a need to sell, you can wait for a more traditional buyer to come along and give you an offer that puts some money in your pocket. If however, you don’t have the time or the money to invest in getting the home sold, an all-cash investor offer might be the better option. If you need to sell your house fast in Kansas City, consider a cash offer from the Tuckers or one of the other investors here in Kansas City.
Before you take that investor option, be sure to complete your due diligence as not all cash investor buyers are created equal.