How to Really Run the Numbers when Reviewing Offers for Your Oklahoma City House

When reviewing offers for your Oklahoma City house, it important that you know how to correctly run the numbers. Just because an offer looks good on paper, doesn’t mean it is the best choice for you. Learn more about how to crunch the numbers in our latest post! 

While the highest offer might appear to be the best, this isn’t always the case. There are many numbers you will need to factor in when reviewing offers for your Oklahoma City house. Below, we discuss some of the costs you may face when selling your home in the Oklahoma City area.

Closing Costs

With a traditional sale to a private buyer, a seller can expect to pay about 2-5% of the final sale price in closing costs. While this varies by the transaction, you’ll want to budget at least 5% to closing costs to ensure you are covered. You don’t want to be surprised at the closing table, owing more than you had planned for.

Closing costs are the collection of fees charged during the final stage of the selling of the property. Closing shall take place after all the contingencies of the purchasing agreement have been confirmed and all the necessary paperwork has been signed and filed.

Closing guarantees that the transaction is legal and that the closing costs meet the services and expenses that accrue during the process. Once the closing has been finalized, the money is released to the seller, less closing costs and agent commissions — assuming that the seller has enough equity in his home and does not have to pay out of pocket.

Repairs

While reviewing offers for your Oklahoma City house, you’ll want to consider all of the costs you encountered making repairs and fixing it up. Repairs aren’t always cheap, and you will likely have to face them before putting your Oklahoma City property on the MLS. In addition, your potential buyer will likely attempt to negotiate even more repairs once the inspection has been completed. Spending money on a house you ultimately want to sell can be extremely frustrating, with a direct sale, you’ll be able to keep that cash in your pocket.

When you are prepared for sale, look for damaged properties, broken appliances and spaces for cleaning or refreshing your home. A summary assessment will also help you determine what needs to be repaired. Depending on your home condition, the total costs of repairs vary. Decide what you can do for yourself and where you may need professional assistance while listing the necessary repairs. Compare quotes from many contractors to accurately reflect a range of costs.

Other Contingencies

There are all kinds of contingencies a buyer might put in their contract. Having a contingency protects the buyer should something go wrong. If there is a problem with the property, they will be able to back out of the sale without any penalty. Some common contingencies include things like not being able to sell their current house in time. If their lender backs out of the deal. And if the inspection comes back with a significant number of repairs that need to be made.

Before you agree on the best offer for your property, take a close look at the contingencies that the buyers have made, i.e. all the steps that need to be taken before the seller can get paid. You can think of them as the terms of the buyer before they agree to a deal — so don’t forget them, because they could potentially “destroy” an otherwise great bid, price-wise.

The most popular contingencies include home inspection, buyer financing, and property appraisal — all of which shield the buyer in the event that significant home defects come to light or the house is not inspected during the closing process.

Some contingencies, however, are riskier for sellers, so watch out for buyers who put forward a bid that depends on selling their current home. You don’t have a way to predict when and where the buyer’s home is going to sell, which puts you in a difficult position where you decide to move quickly.

If you are getting an offer with so many contingencies, see it as a way to help you narrow down your list. And the less obstacles you’re met with when it comes to an bid, the better for you, the seller — even if the dollar sum stated is good.

Timeline

How fast will your buyer be able to close? As any property investor will tell you, the longer you hold on to a property, the more it will end up costing you. Holding costs can add up quickly, eating into your profits. While the property in on the market, you’ll have to continue paying for things such as homeowners insurance, property taxes, utility bills, possibly a mortgage, and routine maintenance on the property. You are responsible for these items up until the day of closing. If your house sits on the market for a while or if your sale falls through, you could find yourself stuck paying these costs for the next several months.

How long it takes to sell a house is strongly influenced by factors that the seller can and can’t control. And a lot of it has to do with changing the cliché, location, and timing.

Often there is no rational explanation for how long it takes to sell a property. It could happen quickly out of sheer luck — the buyer is simply in the right place at the right time. Your house might be on the market the same day that a specific buyer is looking to buy the house you are offering for sale.

More likely, however, that depends on one or more factors.

Risk

When reviewing offers you’ll want to calculate the risk involved in the sale. If your buyer is using financing, you’ll want to be prepared just in case things fall through. Often times, a lender will back out of the deal if a property appraises too low. Sales fall through every day, and you’ll want to be prepared if yours does too. If you’re working with a buyer who is using financing, make sure they are pre-approved, not just pre-qualified.

If you choose to sell to a cash buyer, your risk of things falling through drops significantly. Cash buyers will have the money ready to go before making an offer for your property. This will save you days or even weeks as opposed to dealing with lender requirements. When you sell directly, you won’t have to deal with appraisals, inspections, repairs, or any red-tape from a lender.

If you choose to work with a local {market_city] real estate agent, you’ll have to commit to a listing agreement. Once you have entered into this agreement, your agent will be entitled to their commission, or at least a part of it, no matter how the house sells. However, if you are able to find a reputable buyer such as Local House Buyers before hiring a Oklahoma City agent, you’ll be able to instantly save on commission costs. This can be upwards of 6% of the final sale price that you’ll be able to keep in your pocket. This could amount to thousands of dollars you will e able to use for your next property should you so desire.

Appliances and Fixtures

Sometimes when selling a house, the furniture, fixtures, and appliances will all come into play. Does your potential buyer want to keep any of these items or will you be taking everything with you? If you are leaving any items with the new buyers, you’ll want to factor in how much it will cost you to replace these items. Having to replace appliances, fixtures, and other items in your new home can cost a fortune. Make sure you are prepared for these replacement costs before accepting an offer for your Oklahoma City property.

As a general rule, everything that’s attached to or built into the house usually stays behind when you sell the home. For example, if your house has bookshelves built into it, you can leave those shelves to the buyer. The same applies to all fireplaces, to bathroom fittings and kitchen fittings.

You don’t have to leave your fridge or other purchased appliances, like the washer and dryer or dishwasher, but many sellers do. Buyers often want the appliances to stay, so if you’re willing to take your refrigerator or washer and dryer, it’s a good idea to put it in writing before closing so you’re on the same page as the buyer.

Unless you make a deal with the buyer, any object that belongs to you and is not connected to or otherwise part of the house must go with you when you sell it. Plan to take your furniture, the art that hangs on the walls, the little carpets and curtains with you as you move. If you’re planning to take something that would usually be left behind, such as your precious rose bushes or a light fixture that is a family heirloom, make sure you put it in writing at the beginning of the selling process so that buyers know it’s going to be missing when you close. In that case, it would be a nice gesture to replace whatever item you choose to take with something that new buyers can enjoy.

We can help you know what to look for when reviewing offers for your Oklahoma City property. Get in touch with us today! 405-395-2085

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