If You Own An Old, Structurally Compromised, Or Heavily Damaged House, To Sell It As A Teardown May Be The Best Option
Our Readers Want To Know: “Is My House A Teardown?”
Selling your house as a teardown means acknowledging that the buyer plans to demolish the structure, and therefore often comes with a much-reduced asking price.
Technically speaking, a teardown house is a property that has already been sold as such. That being said, your home may be a good candidate to sell as a teardown if it is:
- Out of date (not quite up to current standards in terms of building and safety codes).
- Non-updated (needs significant plumbing, electrical, and structural renovation).
- Damaged to such a degree that repairs would exceed the fair market value of the structure.
What’s more, you may be exceptionally well situated to sell your house as a teardown if the property is in an attractive or highly sought-after location, especially in proximity to good schools and cultural centers.
What Happens When You Sell Your House As A Teardown?
Once you’ve opted to sell a teardown house, your approach and opportunities as a seller change significantly. If you live in a neighborhood where builders and investors are particularly active, you’re likely to find that selling a teardown house enables you to bypass putting your home on the market. Then, you can skip to negotiating the sale, which can save you time and money that you’d otherwise spend on listing, marketing, and paying realtors’ commissions to sell your home.
Whether you choose to approach a builder about selling your teardown house or decide to list it for sale as-is, you aren’t responsible for property prep, staging, maintenance, and marketing in the same way you would be if it wasn’t a teardown house. The downside of this increased freedom from responsibility is a reduction in the number of interested buyers for your home, as choosing to sell your house as a teardown really only appeals to a small segment of the home buying market.
Read More: How To Sell A House As-Is
Other Things To Consider: It Impacts & Can Be Impacted By The Local Community
Some real estate investors who regularly seek to purchase teardown houses note that community opposition to selling your house as a teardown is not uncommon. What’s more, some local government ordinances seek to regulate the ways homeowners can sell a teardown house by encouraging massive renovation projects over full demolitions (which often call for keeping the foundation in place and using the same footprint for the home) . If you are thinking about selling a teardown house, especially if you are going to [link to: sell your house without a realtor], you should work to become well-informed of the community- and government-responses to teardown houses in your area. You’ll be expected to disclose any known legal interventions that might impact the buyers’ plans for the property.