If you’ve inherited a property and you’re planning to sell it, make sure you read this blog post for 3 tips about how to price your inherited home in Metro Detroit for sale…
Did you inherit a property that you’re now thinking about selling? While an inherited property can be a wonderful gift from a loved one who has passed on, it can also (quite frankly) be a costly burden. So selling it makes sense and allows you to use the gifted equity for some other purpose. But selling an inherited property may not come easy to you, especially if you haven’t sold a property in a while. So here’s how to price your inherited home in Metro Detroit for sale…
Tip #1: Price Quick To Sell
When it comes to pricing inherited property, many people start by guessing what they think the market might pay for the house. However, setting the right price involves more than just an estimate—it requires careful consideration of several factors. One of the most important factors to think about is how quickly you want to sell the property.
For example, if you price the home at what you believe is its market value and list it with a real estate agent, the sale could take several months. During this time, you’ll still be responsible for the property, which can lead to ongoing expenses. These can include property taxes, insurance, utilities, and general maintenance, not to mention any necessary repairs to keep the house in good condition for showings. All of these costs can add up quickly, reducing the financial benefit of waiting for a higher offer.
Let’s say you inherit a property and decide to list it at $300,000, which you believe is close to its market value. If the property sits on the market for six months before selling, you might end up spending thousands on utilities, yard work, and mortgage payments (if there’s still a loan on the property). Additionally, if the house needs any repairs to appeal to buyers, those costs can also reduce your profit.
On the other hand, some owners choose to price the property slightly lower to encourage a faster sale. For instance, instead of listing the home for $300,000, you might price it at $280,000. While this might seem like you’re leaving money on the table, selling the property quickly can save you months of carrying costs, repair expenses, and the hassle of maintaining an additional property.
For example, if by pricing it lower you sell the property within one month, you avoid five months of ongoing expenses. The savings on these costs might balance out, or even outweigh, the $20,000 difference between the higher and lower listing prices.
Moreover, a quicker sale allows you to access the funds sooner, which can be especially important if you need the money for other investments, debts, or expenses. In many cases, what seems like a lower offer could end up being just as financially beneficial when you consider the reduced costs and time involved.
In essence, pricing inherited property is a balancing act between time and money. By considering how quickly you want to sell and the costs associated with holding onto the property, you can make an informed decision that best meets your financial goals. Sometimes, pricing slightly lower for a quicker sale can be a smart move that ultimately leads to the same or even better financial outcome.
Tip #2: Avoid Pricing Based On Fond Memories Or Emotion
One of the biggest challenges that property owners of inherited property face when trying to price their property for sale is separating the happy memories from the true value of the house. The house might be worth a certain amount on the market but you may have such fond memories of growing up in the house or of happy times in the house that you accidentally use that emotion to increase the price. (This is VERY common.)
A better approach would be to work with a real estate company and find out what they can offer you, and recognize that the price might be lower than you were expecting… not because the house isn’t worth as much but because your wonderful memories have accidentally inflated the price!
Tip #3: Build In Discounts For Repairs
If you inherited the property from a loved one who had lived in the property for many years then you might find out that the property needs some repairs. You could choose to do this work yourself and then ask for a higher price but why do that when you could save yourself the time and effort (and what you’d have to pay for equipment, supplies, or a contractor) and instead just ask for less and give a “repair discount”. That way you avoid the hassle of the work, and you still come out the same financially.
Summary
An inherited house can be a lot of work so if you’re thinking of selling it, you’re certainly not alone. But how do you price an inherited house? These tips will guide you on how to price your inherited home in Metro Detroit for sale.