Selling inherited property - ibuyer or traditional?
March 26, 2023 6:44 PM   Subscribe

What to consider when trying to sell an inherited property quickly and as painlessly as possible (while grieving)? Options include ibuyers or the traditional realtor route but hard to know what to do in a rapidly changing market and amidst impending recession fears.

I recently lost my mom in the span of a two unanticipated, gut wrenching, soul crushing months. She passed away in January and since that time I've been all alone in the house I grew up in, sorting through both our things and deciding what to get rid of, processing overwhelming grief and guilt, and settling her estate. My life has come to a standstill (I closed my practice/am currently not working but financially ok) and I'm ready to be done with this particular part of the grieving process that requires me to be here in my mother's home so that I can figure out what the next steps look like for me in a world without my mom (my only real family) in it.

The preamble is to give an indicator of my mental and emotional state as I get ready to put this house up for sale.

Relevant info on the house:

- 4bd/3ba approx 2000 sq ft track home in a nice master planned community in a largish southwestern metro area, with an overall great location (close to shops, parks, highway)

- new floors have been installed within the last 4 years and things have been fixed/updated here and there but it is overall very dated. Meaning, it still has the finishings (tile, so much tile) that were installed back when it was built, in the late 90s. So, definitely something a potential buyer will see, and need to consider renovation costs for

-it's in decent condition with no major systems issues that I am aware of, but I have sold a condo in the past and recall extreme anxiety during the home inspection that something fatal would be found. I'm terrified someone will do the inspection and let me know we need a new roof or foundation or something equally costly and time-consuming

- other homes in the subdivision are either selling very quickly (under contract in a weekend - these have pools and are very nicely updated and are selling for $550K plus) or sitting *for a while* (home down the st that is smaller, more updated finishes than our home, priced lower in the mid $450Ks but has been sitting for 200+ days?!)

- the above makes current comps difficult to figure out, as does the fact that most recent sales figures were when mortgage rates were crazy low and homes were consistently going over asking price

I am hoping to be out by the end of April, so I have reached out to an ibuyer. They unsurprisingly made me a low offer, but it would net $360K. Redfin seems to think it's worth $440K, and Zillow things it's closer to $460K. Neither know the lack of updating. My neighbor who is a realtor took a look and wants to list at...$505K?! (apart from his commission, does my house selling for a high price help the neighbor's property value? This figure seems ridiculous to me.)

I'm meeting with another realtor this week, but honestly I am totally flummoxed at this huge range. I've been plugging in various figures to determine what my net would be at the various price points and any way I slice it, I'd likely still get more than $360K. I know this is probably silly, but there is also this element of feeling obligated to get the max price as a steward of my mom's estate/legacy.

But if my main goal is to finish with this as quickly and painlessly as possible (I'm tired, and I'm doing this alone,) should I just go with the ibuyer knowing I can close in 2 weeks and be out of here in 4 weeks? Are there things I'm not considering about the state of the market/economy (both are causing stress) that I should factor in? Should I manage my anxiety and just put in on the market (on top of managing grief and exhaustion after dealing with all of this solo for 3 months...)?

Any thoughts, experiences, insights, or just plain old "this is what I would do" opinions would be much appreciated.

*also, house was in the trust so no probate or anything that could gum up the sale (thanks, mom)
posted by KarmicKintsugi to Home & Garden (15 answers total) 1 user marked this as a favorite
 
When I bought my current house six years ago, I was essentially your counter-party -- I was buying a house being vacated by an older person who was going into care. Despite being in a housing market that has been "hot" for about thirty years (yes, really), I was the only bidder on the house. It went on the market on a Tuesday, I put in a bid by Thursday, and had won it by next Monday.

...and I was the only bidder because the listing agent didn't do ANYTHING to improve the house for showing -- they didn't even open the blinds or turn on the (expletive) lights. Dirty carpet, terrible paint (I think the last painters realized the older lady couldn't see very well so they did a shit job), et cetera. In my market, given the prices, people expect a certain level of "staging" and assume the worst if they don't see it. The family could have just sold it to an ibuyer and saved some time.

On a conservative estimate, even given current conditions, if I sold I'd get at least double what I paid.

SO: if you get an agent, pick one that will visit the house and give you a list of quick things to improve the odds of a sale. The family selling my place didn't do that, and very nearly didn't get the house sold (it's stunning to have only one bidder in my market, even if the place is falling down). The more finely-tuned their suggestions, the better agent they're likely to be (eg: if they say "spruce the place up a bit" then that's useless; if they say "paint everything with this color, and here's a guy that'll do it by the weekend for $750, also steam-clean the carpeting and get someone to wash the windows" then yay).

I have had family & friends of the old owner unexpectedly stop by to see the place and make happy noises about the upkeep I'm doing, so they don't seem to think I took advantage of the situation (I offered over list price).

I mean, IMO, $40K is a decent amount of money so a few days of concentrated effort would (again, IMO) be worth it to get that extra. However, my parents sold to a developer knowing they'd get less than "the market" but they'd be rid of the place in two days and for them that was worth it -- so in the end, what is your time/effort worth? If you just can't deal with the hassle, then go for the ibuyer and (this is key) don't feel bad about your choice!
posted by aramaic at 7:32 PM on March 26, 2023 [7 favorites]


Don't sell cheap for a few weeks of imagined relief. A $100,000 difference will become meaningful as your grief changes shape over time.

See what the second realtor says. I've been in a similar position with a house sale quote and decided to take the more ambitious one. Got every cent. Even if it takes 100 days to sell for the higher net gain, that's a fine return of $1k per day.

Forget abort the economy and the market. You have no control over them. Don't worry about affecting your neighbours value, ditto.

Should I manage my anxiety and just put in on the market

Yes. You came to this conclusion yourself. You know it's the best thing to do for future you.

(on top of managing grief and exhaustion after dealing with all of this solo for 3 months...)?

This is the real crux of your post and its pushing your anxiety. You are overwhelmed and tired while still doing the best you can. You deserve help. Talk to to your chosen realtor about hiring help to clear the house and get yourself a lawyer for any paperwork, agent contract etc.

Take care.
posted by Thella at 7:39 PM on March 26, 2023 [14 favorites]


Bottom line: Realtors have a fiduciary responsibility to act in your best interest. Wholesalers (whether ibuyers, "we pay cash" types, people who send you respectful letters, etc.) do not. A good wholesaler will be really honest about the deal you're making (that you're getting less cash in exchange for selling quickly on your own terms), but still. The other thing is that some subset of those people can close much faster than 4 weeks, so that can always be your backup plan.

There was awhile when ibuyers were overpaying to get established in my local market, but from what you're hearing, it doesn't sound like it there. I'd get info from another realtor or two and just be honest with them about what you can / can't do to fix it up. A good realtor can help you find movers, painters, a storage unit, etc. Your neighbor's estimate is probably pretty good, if he's a realtor who lives in the neighborhood. His incentive to overestimate is to get the sales contract and eventual commission, not to shore up his property value, but there's research that shows (again, in my area, so maybe not yours) that overpricing a home leads to it sitting and selling for a slightly lower price per square foot than it might have otherwise, plus all that delay will take the selling realtor more weekends of showings, so a good realtor won't overprice it either.

I'm so sorry for your loss. The other thing you might consider is that if you don't want to stay in that house anymore, you could consider staying in an AirBnB, VRBO, Furnished Finder type place.
posted by slidell at 8:16 PM on March 26, 2023 [5 favorites]


apart from his commission, does my house selling for a high price help the neighbor's property value?

Yeah, at least a little! That sale will be a (somewhat) comp, and is part of how Zillow and Redfin etc make their estimates. It's all a bit pretend but generally speaking, neighboring houses selling high will drive up the perceived value of a given house (which then becomes an actual value when it sells, etc)
posted by SaltySalticid at 8:46 PM on March 26, 2023 [1 favorite]


Best answer: I've bought or sold eight different times over the years (all in the US). The most recent sale was a house located across the country where I had no connection and no desire to be actively involved in the process. Here is how I did it:
1. I went on zillow and look at the real estate agents who had the most sales in the local area. Local knowledge is really important. Then I narrowed it down to 3-4 based on their self-description and reviews. I called these folks and arranged for a zoom call to get to know them and to get their impression of the local market. I was very clear that I needed someone who could take care of doing all the work to hire and coordinate with tradespeople needed to fix up the house.

The top three I arranged with a friend to give them a walk-through of the house and we did a follow up call where we discussed how they market it. I picked the one that gave me the most confidence that she knew what she was doing, she would be able to take care of 100% of the fixing process and I thought she was be realistic about the market - not quoting an unrealistically high price just get me to hire her.

2. The real estate agent, after talking to me about my budget for repairs, came back with a proposal for what she recommended that we do to fix up the house for sale. I can tell you that very few buyers have enough imagination to see what fresh paint and carpets can do to a room. Unless this is a tear down or it was recently updated, it is almost always worth it to paint and replace the carpets. Little things like a new light fixture in the dining room or bathroom can also make a big difference for a small amount of money. Mostly I just did whatever she recommended as long as it was within the general budget that we agreed on.

3. The real estate agent and her assistant went off and arranged for everything to get done to make the house ready for sale. It took about a month which seems to be typical. I would get a phone call once in a while letting me know about any surprises - no big ones but she was careful to check with me about anything that would effect the cost. Meanwhile she worried about hiring people, scheduling, picking colors and brands. When she sent me an itemized bill, I paid it. (I think you can also arrange to pay at least some of out of the closing costs - ask if that's important.)

4. This particular agent recommended that we pay for a home inspection so we could catch anything minor and make it go away and disclose anything we didn't fix so there would be not surprises at the last minute. She also recommended that we hire a professional appraiser to help set the right asking price. In my experience (with this and other houses) in a hot market it makes sense to be a little low on the asking price so you get more buyers interested and then you end up with multiple offers (yay!)

5. The real estate agent put the house on the market, took care of the showing and collected the offers. it was a hot market and she advised me on how to manage multiple offers. It went super well and we ended up getting way more than anyone had predicted two months earlier. YMMV.

6. The real estate agent took care of all of the dealings with the buyer and the buyers agent. She sent me what I needed to sign. i just did as she told me. She let me know as the inspections etc happened but I didn't have to do anything. When the buyer complained about some things they found on inspection, she advised me on how to respond and took the pressure off of me to figure out what was fair. Sale closed on time with very minimal stress or involvement from me.

Bottom line: if you can just find a good real estate agent, then they will do 98% of the work and get the best price for the house. Do interview a couple of different agents and check them out online in terms of both reputation and experience.
posted by metahawk at 10:01 PM on March 26, 2023 [12 favorites]


Oh gosh, just get a real good realtor and let them do almost all of this. They’ll take care of so much. My condolences to you during a tough time.
posted by bluedaisy at 10:09 PM on March 26, 2023 [6 favorites]


Former property lawyer - metahawk is quite correct on the process. The offer you are getting from the ibuyer allows them to earn a significant profit - which is money that you are missing out on.

Just to give you a better perspective - consider staying in a hotel for a few days and examine what low stress things you can do when you get back to the house to move the process along.
posted by Barbara Spitzer at 11:57 PM on March 26, 2023 [1 favorite]


I agree with everything metahawk has said. This is a difficult time for you (my own mother passed in December) and you have my sympathy. It's easy to say 'I don't care about the money, it won't bring my mother back' and that's absolutely true. But this is your mother's legacy to you and dredging up the will to find an agent that will work with you to market the property so it presents at its best will let you maximise that legacy. I know you don't care about the money today, but that extra 50 or 100k will be a life-changing amount of money for you down the track and this is the only chance you get to take advantage of that.

if you can just find a good real estate agent, then they will do 98% of the work and get the best price for the house
This is the most important thing. The agent works for you and it's perfectly reasonable to expect them to earn their commission. A good agent will bend over backwards to get that house on the market looking perfect, because that't the only way they earn a living.
posted by dg at 12:14 AM on March 27, 2023 [2 favorites]


The thing I would ask a realtor is “what price and which changes would make it sell quickly?”. You do not have to get top dollar if what you really want is a good price and quick sale.
posted by plonkee at 12:29 AM on March 27, 2023 [1 favorite]


I sold my parents' house last year. It is soooo worth it to pay a realtor to do the worrying for you. A good realtor has tons of connections and a wealth of experience --well worth the commission you'll pay
I was very honest with my realtor and told her that for my own mental/emotional health I needed the process to go as easily and smoothly as possible. She gave me referrals for every outside person I needed ( attorney, deep cleaning etc). I also learned that I was totally lowballing the price (because I'm not a realtor!). She did all the negotiating for me and I ended up selling for more than I anticipated.
Please be kind to yourself as you go through this. Best wishes.
posted by bookmammal at 6:18 AM on March 27, 2023 [1 favorite]


We've sold two houses. For the first, we handled all the painting and prepping before the sale, and ended up feeling like the realtor's fee was a total waste since they did zilch other than list the place. In hindsight we should have tried a FSBO since we were doing all the other work anyway.

For the second, we did something much more like what metahawk describes since we were moving in a hurry and would be out of state well before it got listed. The realtor we worked with totally earned his fee on that one. While being very transparent with us, he brought in and supervised people to do all of the internal and external fixes that were needed. (These weren't structural fixes, just things like painting, carpet in one room, landscaping, etc.) We wrote a check for the work but were given the option to have it come out of the closing, too. I had zero resentment about paying the realtor's fee on that sale, and it required very little from us from beginning to end.

It requires a good realtor who knows their craft and who has the right set of cheap-but-good contractors on tap, and who can judge what is the exact right amount, but no more than required, of cosmetic work needed. But for a situation like yours, where for emotional reasons having someone else handle the details is what you need, this would be the right arrangement.
posted by Dip Flash at 7:01 AM on March 27, 2023 [3 favorites]


Specifically to find a good realtor: go to Zillow, enter your ZIP code, then click on Agent finder. That's a start but only a start. Now go to each one's page and look at their Listings & Sales map. That is what you want to use: find the person who focuses on -sales- in your very specific neighborhood. It's worth the hour you'll spend.
posted by Dashy at 9:14 AM on March 27, 2023 [2 favorites]


I took care of a beloved aunt's home when she died. I had to sort through her hoarded family papers and photos, and find a home for her hoarded drinking glasses, multiple flatware sets, 150 VCR tapes, and very dated house stuffed with furniture. Mostly, this was goodwill. It took me 3 months, partly because I could only devote 2 days a week. I gave away anything I could, and had to hire people to help me move furniture down the dauntingly narrow stairs on trash day, hoping someone would scavenge her dining room chairs or dated floor lamps. A surprising amount of stuff got taken, I think because I was setting a good amount out before every single trash day, so there was probably some anticipation by scavengers. I also threw out an amazing amount of stuff and hired a clean-out service when the only things left were heavy pieces nobody wanted. It was very daunting and depressing, but my mood lifted when it was empty.

All this to -- hire a good realtor. She walked me through the house partway through clearing stuff out, and thought as-is but empty and clean would bring 20-30% less than if I repainted, hired someone to wash and polish the wood floors, and purchase upscale-appearing lighting fixtures. I especially had the painter (she provided 3 names and I interviewed 2 and got estimates) re-paint a blindingly yellow bathroom (tile was 50's bright yellow and black. It looked much better tamed by white walls and cabinetry.) Neutral floral wallpaper in the primary bedroom was in good shape, save for a couple of stains where furniture was in front. I left it alone. I also was advised to have the painter paint the raw and stained concrete basement and garage floors, and repaint the garage door. The main floor had its woodwork repainted, but not the upstairs, except that bathroom. I did not replace very dated kitchen appliances (harvest gold) but the white fridge was less than 2 years old and everything worked. The roof had been recently asphalt coated (flat roof) and the heating system had been replaced in the previous year. My aunt was on top of maintenance, but if something worked she didn't replace it. My total cost was less than $4,000 - it was a small house. I did not pay to stage it.

I did everything the realtor asked. I didn't get 30% more. I got 40% more after about 5 days on the market. Best of luck to you, and I'm very sorry for your loss.
posted by citygirl at 11:04 AM on March 27, 2023 [1 favorite]


I was in a similar situation very recently. We were selling Mom's house to pay for her nursing care, and she unexpectedly passed away as we were in the midst of getting it listed. We hired a realtor who took care of everything because we were taking care of Mom. It listed on Friday and we had 5 offers by Monday and sold for about 10% higher than any of the comps in the neighborhood.

I understand why you are worried about that one house in the neighborhood that won't sell, but you don't know what the sticking point is. The entire place could smell like 10 incontinent cats have been chain smoking in it for the house's entire existence. There could have been a murder in the house. There could be a tomb on the property that the seller refuses to move. The seller could have some sort of requirement for the house sale, such as "may only be sold to Christopher Meloni."

I also strongly, strongly, STRONGLY suggest working with an estate sales person on your mom's stuff. There is only so much you can do, and if you are not planning to keep all of her things, an estate sales person can manage moving on the things you can't keep and take that stress off you. They also understand the value of items better than you do. (Feelings and family lore can cause you to overvalue or undervalue objects.)
posted by rednikki at 2:29 PM on March 27, 2023 [1 favorite]


Response by poster: Thanks everyone for the insights. Yes for sure my anxiety and grief is limiting my ability to see alternatives right now so the step by steps and anecdotes are really helpful.

I managed to meet with 2 other agents that seem to know this particular market well and they both came up with the same listing number after taking a look at the place (a number that was significantly less than my neighbor's.) All of this and their demeanor/approach gave me confidence, which assuages the anxiety a bit.

also @rednikki - thanks for the strong suggestion! estate sale folks are coming by for a consultation this week!
posted by KarmicKintsugi at 5:01 PM on March 28, 2023


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