Do Foundation Problems Affect Home Resale Value & Marketability?
Visible signs of foundation issues will most definitely have a negative effect on your home’s resale value and your ability to market the home successfully. That is the reality.
First, the issue will be seen by any reputable home inspector notwithstanding your legal obligation to disclose the defects. Any efforts to hide or mask the problem will likely backfire, sooner or later.
Put yourself in the shoes of a typical homebuyer, looking for a nice place to live. Would you want to buy a place with uneven bouncy floors, cracks in exterior bricks or sheetrock cracks around windows or doors? Marketing a property with foundation issues is not impossible but it will certainly present a challenge to you and your real estate agent.
Even if you find someone willing to buy with these obvious defects, a bank or mortgage lender will not put a loan on the property unless the foundation failure is corrected prior to closing. This is because the condition and value of the property will continue to decline over time thus depreciating the security of their loan.
The exception to this is to find a buyer willing to buy and finance with an FHA 203(k) Consultant Loan. This loan program can be used by fixer-upper buyers who intend to live in a home that has structural problems (among other issues). Note that an FHA 203(k) Limited Loan would not work due to the foundation issue.
What are your options as a homeowner wanting to sell your property?
- Sell to a fixer-upper buyer (owner-occupied not an investor) willing to utilize the FHA 203(k) program. Depending on the severity of the foundation and other issues needing renovation, a sales price well under full market value will be likely.
- Sell “as is” to an all cash investor. Marketing to investors looking to flip a property will attract offers but expect at least a 25% discount below market value.
- Get the foundation fixed up front which will allow a sale at full market value for your neighborhood. There are usually several financing options available including refinancing the home yourself with an FHA 203(k).
Foundation Repair Company Expertise
Regardless of the option you choose, your best starting point is to get your foundation inspected by a foundation repair professional. Of course, if you are in the Dallas-Ft. Worth area, we suggest our company, Foundation Repair Pros! We have been doing these inspections day in and day out for 20+ years and have seen it all! And we can help you with financing options. For more information on costs: How Much Does Foundation Repair Cost?
The key advantage of getting this done right away is that you will find out exactly what is causing the problem along with a written estimate for getting the problem fixed. This will be critical in helping you decide how best to proceed with the sale of your home.
Best of all, you can find out what is wrong with your foundation and how much it is going to cost to get it fixed…absolutely free. Give us a call right now and we’ll schedule your no-obligation appointment: