My House Needs More Repairs Than I Can Afford — What Are My Options?

If you own a house in Philadelphia that needs more work than you can afford, the first thing we want you to know is simple:

You do not automatically have to fix everything before you sell.

We’ve been buying properties in Philadelphia since 2015, and David and Sufey have seen plenty of houses where the repair list starts with “it needs a new roof” and somehow ends three pages later with plumbing, electrical, windows, flooring, a kitchen from 1974, and a basement that has developed its own personality.

At some point, you have to ask a different question:

Does it actually make financial sense to keep putting money into this property?

Sometimes the answer is yes.

Sometimes it’s absolutely not.

Here are the options we think Philadelphia homeowners should understand before spending another dollar.

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First: Figure Out What Actually Needs to Be Fixed

There’s a big difference between a house that’s dated and a house with serious problems.

Ugly kitchen cabinets—well, old kitchen cabinets—aren’t the same thing as a leaking roof.

Pink bathroom tile from 1968 may not win any design awards, but it doesn’t necessarily stop someone from buying the house.

Major issues are different.

We’re talking about things like:

• Roof leaks or structural damage
• Electrical problems
• Plumbing or sewer issues
• Foundation problems
• Water damage
• Mold or moisture problems
• Broken HVAC systems
• Fire damage
• Significant exterior deterioration
• L&I violations
• Multiple major systems reaching the end of their useful life

Philadelphia’s Department of Licenses and Inspections (L&I) enforces the City’s property maintenance, building, fire and related codes. If L&I finds violations, it can issue a Notice of Violation requiring corrective action.

So before deciding what to do, separate the “I’d like to update this” items from the “this actually needs attention” items.

Those are two very different lists.

Option 1: Make the Repairs and Then Sell

Let’s start with something you might not expect to hear from a company that buys houses as-is:

Sometimes you should fix the house.

If your property needs $10,000 in repairs but those repairs could realistically increase your net proceeds by $40,000, and you have the time and money to complete them, making the repairs may be the better financial decision.

We’re not going to pretend otherwise.

This can be especially true when the property is in a desirable neighborhood, most of the house is already in good condition, and only a few issues are keeping it from showing well on the traditional market.

But don’t automatically assume that $30,000 spent = $30,000 added to your pocket.

That’s not how renovations work.

Before renovating, figure out:

What will the repairs realistically cost?

How much additional value will they create?

How long will the work take?

What will you spend carrying the property while the work is happening?

What will your actual net proceeds be after selling costs?

That’s the number that matters.

Option 2: Fix Only What Really Matters

You also don’t have to choose between renovating the entire house and doing absolutely nothing.

Sometimes the smartest solution is somewhere in the middle.

You might repair an active roof leak but leave the dated kitchen alone.

You might address a safety issue without replacing every floor.

You might clean the property, remove obvious debris and make a few inexpensive improvements rather than committing to a six-month renovation.

This is particularly important with Philadelphia’s older housing stock.

Anyone who has worked on enough Philly rowhomes knows how quickly:

“We’re just going to open this wall.”

can become:

“Well…now that the wall is open…”

That’s when the budget starts developing a sense of humor.

For more substantial work, don’t assume every project is simply a DIY weekend job. Philadelphia requires building permits for many major repairs and alterations, although routine maintenance and certain smaller projects may not require one.

Option 3: Look Into Repair Assistance

If you actually want to stay in the home but can’t afford necessary repairs, selling shouldn’t automatically be your first move.

Philadelphia has programs that may help qualifying homeowners with certain repairs.

For example, the City identifies programs including the Basic Systems Repair Program, which can assist eligible owner-occupants with certain electrical, plumbing, heating, roofing and structural emergencies, along with other repair and financing resources.

That’s important enough to say clearly:

If you want to stay in your house, explore whether assistance is available before deciding you have to sell it.

Philly Home Investor buys properties. Of course we’d be happy to make you an offer.

But if what you really want is to keep your home and there’s a legitimate program that can help you do that, you should know about it.

Option 4: List the Property As-Is

Another option is putting the property on the market without completing all of the repairs.

There are buyers willing to purchase properties that need work.

The tradeoff is that the condition of the house may affect the number of interested buyers, financing options, inspections, negotiations and ultimately the price someone is willing to pay.

You also need to be transparent about known issues and follow applicable disclosure requirements.

And Philadelphia has an additional local requirement worth knowing: Pennsylvania law requires a Property Sales Certification when real estate is sold in Philadelphia. Among other information, that certification discloses uncorrected violations of applicable housing, building, safety and fire ordinances.

So “as-is” doesn’t mean:

Nobody needs to know what’s wrong with the house.

It means you’re offering the property in its current condition rather than agreeing to renovate it into somebody else’s dream home before selling.

Option 5: Sell Directly to a Buyer Who Will Take the Property in Its Current Condition

This is where companies like ours come in.

At Philly Home Investor, we purchase properties in their current condition.

That means we’re not expecting you to install a new kitchen, replace the carpet, repaint every bedroom or make the house look like something you saw on HGTV.

If the property needs significant work, we evaluate the house based on its current condition, what we believe it will ultimately be worth, the repairs and other costs we expect to take on, and the margin we need for the project to make sense.

Then we make an offer.

You decide whether that number makes sense for you.

That’s it.

There shouldn’t be any mystery around the fact that an investor needs to account for repairs, risk, holding costs and profit.

We’re running a business.

You’re making a financial decision.

Both sides should understand the numbers.

“But Won’t I Get More Money If I Fix It?”

Maybe.

That’s the straight answer.

Suppose your Philadelphia house could potentially sell for $300,000 after renovations.

You receive a direct as-is offer for considerably less.

At first glance, $300,000 obviously sounds better.

But now suppose getting the house ready requires:

$65,000 in renovations

plus months of taxes, insurance, utilities and maintenance.

Then there may be agent compensation, seller closing costs, concessions or additional repairs discovered during the process.

Suddenly you’re not comparing:

$300,000 vs. the cash offer.

You’re comparing:

What you actually walk away with under Option A vs. what you actually walk away with under Option B.

That’s the comparison homeowners should make.

And sometimes the traditional sale still wins.

Other times, once everything is calculated, the difference is much smaller than the homeowner expected.

What If I Can’t Afford a New Roof?

You can still explore selling the property.

A roof that needs replacement will affect value, but it doesn’t necessarily mean you must personally replace it before anyone can buy the house.

The same principle can apply to other expensive issues.

The question becomes whether the buyer is willing and able to assume the work and how that anticipated expense affects what they’re willing to pay.

What If the House Has Plumbing or Sewer Problems?

This is particularly relevant in Philadelphia.

Older homes can come with older plumbing, sewer lines and service connections—and those repairs can become expensive.

The Philadelphia Water Department notes that property owners can be responsible for certain plumbing connections between the house and the City’s water or sewer main, including portions that may extend beneath the sidewalk or roadway. City of Philadelphia

If you’ve received a defect notice or already know there’s a serious plumbing problem, don’t ignore it.

But don’t assume your only choice is spending thousands of dollars tomorrow either.

Find out what the problem actually is, what correcting it would cost, and how it affects your different selling options.

What If My Property Has Code Violations?

This is another situation we regularly encounter in Philadelphia.

A code violation doesn’t automatically mean the property is unsellable.

But it shouldn’t be ignored.

L&I can issue violations for property-maintenance and building-code issues, and unresolved violations can lead to enforcement actions and penalties.

If you’re thinking about selling a property with violations, find out exactly what’s outstanding.

Don’t rely on:

“I think the City sent me something a few years ago.”

That’s not exactly a legal strategy.

Understand what’s attached to the property and discuss with your title company, attorney or other qualified professional how those items would be addressed in a potential sale.

What If I Inherited a House That Needs a Ton of Work?

This is one of the most common situations where we tell families not to start renovating immediately.

You may have inherited a house your parent or grandparent owned for 30, 40 or 50 years.

The kitchen is dated.

The electrical needs attention.

There’s stuff everywhere.

The roof is questionable.

And three family members have three completely different opinions about what should happen next.

Before anybody starts swinging a hammer, get information.

Find out what the property could sell for in its current condition.

Find out what realistic renovations would cost.

Find out what the renovated property could reasonably sell for.

Then compare the numbers.

You may discover that renovating is worthwhile.

You may also discover that you’ve just volunteered yourself to become an unpaid general contractor for the next six months.

The Question David and Sufey Would Ask

After more than a decade of buying properties, we’ve learned that homeowners often start with the wrong question.

They ask:

“How am I going to afford all these repairs?”

We’d start one step earlier:

“Do you actually need to make them?”

If you’re staying in the house, the answer may very well be yes.

If you’re listing traditionally, certain repairs may make financial sense.

If you’re selling the property in its current condition, maybe not.

Don’t spend $40,000 because someone told you that’s simply what you’re “supposed” to do before selling.

Run the numbers first.

A Simple Way to Compare Your Options

If this were our property, we’d put three numbers on a piece of paper:

1. What could I realistically sell it for today in its current condition?

2. What would the repairs actually cost—not the number I’m hoping they’ll cost?

3. What would I realistically net if I repaired and sold it afterward?

Notice we said net.

Not asking price.

Not Zillow estimate.

Not what your neighbor’s completely renovated house sold for.

What actually ends up in your pocket.

That’s the number worth comparing.

When Selling As-Is May Make Sense

Selling without making major repairs may be worth considering when the property needs substantial work, you don’t have the cash for renovations, you’ve inherited a house you don’t want to manage, you’re dealing with an unwanted rental, the property has been sitting vacant, you live out of state, or you’re simply ready to stop putting money into it.

Convenience has value.

So does time.

So does certainty.

And anyone who has ever spent six months dealing with contractors knows that sanity probably deserves a line item on the spreadsheet too.

How Philly Home Investor Can Help

David and Sufey started Philly Home Investor in 2015, and since then we’ve purchased hundreds of properties throughout Philadelphia and the surrounding area.

We’ve seen beautifully maintained houses.

We’ve seen houses needing a little TLC.

And we’ve seen properties where the repair list could qualify as light reading for a cross-country flight.

We’re comfortable with all of them.

If your property needs more repairs than you can afford—or more repairs than you simply want to deal with—we can look at it exactly as it sits today.

We’ll explain what we’d be willing to pay and why.

Then you can compare that option against repairing the house, listing it, keeping it or doing something else entirely.

No pressure. No judgment about the condition of the property. And no pretending that selling to us is the right answer for everybody.

Sometimes it is.

Sometimes it isn’t.

Our job is to give you another option.

Have a Philadelphia property that needs more work than you want to take on?

Call Philly Home Investor at (215) 804-9105 and tell us what’s going on.

We’ll start there.