Get the inside scoop on how cash buyers determine their offer, from subtracting repair costs to factoring in their own eventual profit margin.

Have you ever wondered what really happens when you click “get your cash offer now”? Those “cash buyers, as-is sales, quick close” buttons seem like the simplest thing in today’s real estate market. But what does it actually mean for you? I’m here to lay it all out from my own experience.

What a cash offer really means. When you ask for an all-cash offer, you’re basically choosing speed and convenience over the traditional process. Even if you think your house would sell for a really good number, cash buyers will offer about 80% of what it could actually sell for. That’s because there are costs tied to buying and selling properties like this, and the buyer also needs to make a profit.

Typical situations where cash sales make sense. Most people who want to sell right away fall into a few categories. They might have deferred maintenance, a hoarder house, massive damage, or other big issues. Those things push the number down even further because the buyer has to factor in the extra work.

“Combining AI’s range with professional insight is the best way to price your home.”

How offers are calculated. Here’s what’s really happening behind the scenes: you start with about 80% of the market value, then subtract all the repairs that need to be done to the property, plus holding costs and any other costs of sale.

Buyers also think about what it will cost them when they eventually sell the house on the market. That’s why most of the offers you’ll see are in the 50% to 65% range of what’s called ARV, or “after repair value”. How much work your house needs influences where your offer lands.

If you’re curious about this process, you can always reach out to us at Good Company Real Estate. Give us a call at 480-267-9368 or send an email to Office@GoodCompanyRE.com.  We’re here to make sure you get the best deal for your home.