By Justin Liva, Mojo House BuyersBefore we talk about an offer, I remind every seller of one thing: you can usually get top dollar by listing with an agent and waiting a few months. I buy houses for cash, so that may sound like a strange thing for me to say. It's still true, and I'd rather you hear it from me than find out later.
Most of the people who come to me want the sale done sooner, or they don't want the hassle that comes with a listing. Both are fair reasons. The point of this guide is to help you see which group you're in.
What a listing really gives you
A listing's big advantage is price. When a house is already updated, I can't compete with it, because my number has to leave room for the project to make sense, and a finished house leaves very little of that room.
The price of that upside is time and effort. You keep the house ready for showings and open houses. After you sign, the New Jersey Department of Banking and Insurance's home buying guide recommends the buyer get an independent inspection, and it says loan processing can take 30 to 90 days for a buyer who wasn't pre-approved.
There's also the commission. The same guide explains that a broker is paid a commission that is generally a percentage of the sale price, and that consumers are always free to try to negotiate a lower rate. Ask more than one agent what they charge and what you get for it.
One more New Jersey detail: when a real estate licensee prepares the sales contract, it must include an attorney review clause. That clause gives the buyer and seller three business days after the fully signed contract is delivered to consult a lawyer, who can propose changes or cancel it. I cover the rest of the process in the NJ home sale and attorney review guide.
What a cash sale really gives you
A direct sale trades some price for certainty. When you sell to me, there's no agent commission. I buy houses in any condition, including fire-damaged and unlivable ones, so you don't fix anything. Anything you don't want to keep can stay in the house, because the cleanout after the sale is my job. I pay cash, so there's no buyer's loan to wait on.
You also pick the date. I close on the seller's timeline, and I don't pressure anyone to sign.
The trade-off is real, and I won't pretend otherwise. My number has to work for you, for me and for whoever finishes the project, which means room for repairs, carrying costs and the cost of selling again. That's why a cash offer on a dated house is lower than what a finished house down the street sold for. If you want to see exactly how that number gets built, read how investors price houses.
Who should list, and who should call a cash buyer
Listing probably makes sense for you if:
- The house is move-in ready or needs only paint and small fixes.
- You have a few months and can live with showings.
- You can cover the mortgage, taxes and utilities while it's on the market.
- Getting the last dollar matters more to you than the date.
A cash buyer is worth a call if:
- The house needs a new kitchen, a roof, a furnace or more, or it's fire-damaged or unlivable.
- You inherited it and live far away, or the estate can't fund repairs.
- There are tenants living there, a hoarding problem or years of belongings inside. I buy with tenants in place.
- You're facing a deadline such as a job move, a divorce or missed mortgage payments.
- You simply don't want strangers walking through your home.
- It's a condo you'd rather sell without a listing. I buy condos too.
Why I usually pass on houses already listed
I generally don't go after houses that are already on the MLS, and I rarely buy houses that are in great shape. That isn't a policy for its own sake. When a house is updated and priced for retail buyers, there just isn't enough room in the price for an investor to pay you a fair number and still make the project work.
So if your house is a strong listing candidate, I'll say so before we get anywhere near a contract. A low offer on a house that should be listed isn't good for you, and it isn't how I want to do business.
Compare the two on what you keep
The headline price is the wrong number to compare. What matters is what lands in your account after everything is paid. For a listing, start with the agent's realistic sale price and subtract the commission, any repairs or staging the agent recommends, the months of carrying costs while it sells, and any credit you might give a buyer after inspection. For a cash sale, look at the offer and ask who's paying which closing costs, since that varies from deal to deal.
Our seller closing costs guide lists the usual New Jersey line items, including the realty transfer fee that sellers pay. For a broader side-by-side, see the comparison page.
If the two net numbers are close, list it. If the cash number is close enough and the time, repairs and uncertainty of a listing aren't worth the difference to you, a direct sale may be the better fit. Either way, have a real estate attorney look at any contract before you're bound by it.
My offer is free, and asking for one doesn't commit you to anything. If you'd like a number to set next to an agent's estimate, you can request a cash offer here, and I'll tell you honestly if I think you'd do better listing.