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The $5,000 Repair That Costs $20,000
Imagine the AC needs a known $5,000 repair.
Buyers walk through and think: "Broken air conditioner. What else is wrong?"
They mentally subtract $15,000 or $20,000.
That can make fixing it worthwhile.
The $25,000 Repair That Adds $5,000
Seller wants to replace perfectly functional flooring throughout the house because it is dated.
Example
Cost: $25,000
Potential market improvement: maybe modest
That may be a poor return.
Buyers Price Uncertainty
This is crucial. A known problem is easier to price than an unknown one.
Example
"Water heater needs replacement. Quote is $2,200."
is easier to price than:
"There's some kind of water issue. We don't know."
Uncertainty creates larger discounts because buyers price the risk.
Three Options
Fix It
Best when the repair removes a major objection, costs less than the buyer's likely discount, improves financing or insurability, and can be completed reliably.
Price for It
Best when the repair is expensive, the seller lacks cash, the buyer may prefer their own choices, or the seller needs speed.
Credit for It
Potentially useful when the buyer has accepted the condition and the transaction and lender permit a negotiated credit.
Do Not Chase Every Inspection Item
A home inspection may contain dozens of observations. That does not mean the house needs to become new.
Focus on:
- Safety
- Systems
- Water
- Roof
- Major function
- Expensive surprises
Seller Net Is the Test
Compare sale price after repair minus repair expense minus carrying cost, against the likely as-is sale price.
That is the number that matters. Run both routes through the seller net sheet before you decide, or ask Lisa to compare them for you.
