As a seller, you may want to offload your home or renovation property “as-is.” When a home is listed “as-is,” this means that the property owner will not make any repairs when selling the home. The buyer understands this when they go into the bidding process, and the home is often discounted in the process.
The repairs that need to be made may be minor, or they may be serious, such as replacing the roof.
Understanding Appraisal Value Without Replacing the Roof
“As-is” doesn’t mean that the roof is necessarily leaking or in bad shape, but the roof may be old. Perhaps the roof could be replaced because it’s near the end of its lifespan. The best roof shingles can last 25 years if using fiber cement shingles. But a roof that is made from metal can last 50 years.
If your roof is 23 years old and uses fiber cement shingles, the potential buyer may not want to purchase the home because of the eventual cost of replacing the roof.
Now, in terms of a sales price, if the roof isn’t leaking or doesn’t show signs of damage, it will not lower the appraised value.
A roof that is older yet in good condition will not cause the price of the home to drop.
Judging the Increased Value That the Replacement Offers
How much can you sell the home for if the roof has been replaced? That depends on a number of things. If the roof is leaking or in such a bad shape that it lowers the appraised value, you’ll be able to sell the home for a higher price when the roof has been replaced.
Sales are also faster when there’s been a recent roof replacement.
In terms of insurance, prices are lower when a home has a new roof, so this is an additional selling point.
Generally speaking, the home’s value will reflect the cost of the roof replacement. If you plan on selling the property for $100,000 but the home needs a new roof, you’ll need to deduct the cost of the new roof. Roof replacement can cost $5,000 - $10,000, depending on the size of the home.
In terms of a return on investment, Remodeling Magazine claims that a full roof replacement will provide a return on investment of 53.4%. So, a $10,000 roof replacement may add $15,000 to the home’s value.
If you’re selling “as-is,” you may want to consider a roof replacement to:
· Sell the home faster
· Add value to the selling price
But you will also be adding to your expenses when selling the home. If you don’t have the capital to make the replacement, selling “as-is” may be the best option. You will need to lower the selling price of the home, and you will have a harder time selling the home unless the price is on the low-end based off of current sales comparisons.
Selling “as-is” means that the final sale price may be lower, but you won’t need to spend extra time on the home or invest more into the home.
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