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Why Cash Investors Are Attractive
Potential advantages:
- Fast closing
- No ordinary financing
- As-is purchase
- Fewer showings
- May accept belongings
- May accept major repairs
Those benefits have economic value.
What Is the Investor Being Paid For?
Risk and profit. An investor usually needs enough margin for repairs, holding costs, financing, resale cost, market risk, and profit.
That normally means the offer is below what the investor believes the property could ultimately be worth.
Example
Example
Investor offer: $390,000 cash.
MLS estimated as-is price: $435,000.
Suppose the MLS sale adds $25,000 in selling costs and concessions compared with the investor route.
Net comparison: investor approximately $390,000 minus applicable direct-sale costs; MLS $435,000 minus approximately $25,000 = $410,000.
Now MLS may still produce $20,000 more.
But if MLS requires a $15,000 repair, two months holding cost, and significant uncertainty, the difference can shrink.
Different Example
Example
Investor: $300,000.
MLS likely: $420,000.
Now convenience may be costing the seller six figures.
That deserves real scrutiny.
The Right Question
HOW MUCH AM I BEING PAID TO ACCEPT THE INCONVENIENCE OF A NORMAL MARKET SALE?
Or, from the other side:
HOW MUCH AM I PAYING FOR THE CONVENIENCE OF THE CASH OFFER?
Get Both Numbers
Lisa can tell you the likely as-is market price, expected time, probable costs, and buyer demand. Then compare that with the actual investor offer.
You Can Still Sell to the Investor
The point is not that cash investors are bad. The point is:
KNOW WHAT THE CONVENIENCE COSTS.
Start by asking Lisa to run both scenarios, or use the home value tool and seller net sheet to build your own comparison.
