Should You Sell Your House for Cash?
Most sellers who end up doing a cash sale had a retail path that was harder to execute than their situation could support. The ones with time and a property in solid shape usually end up listing, and I’ll say that early in the conversation.
Whether the trade makes sense usually has more to do with the seller’s situation than the property itself. Most of the time it comes down to a timeline or a complication that makes the listing process harder than it needs to be.
When it makes sense
You need a specific close date, not a best estimate
We worked with a couple on a condo on Del Mar Blvd in Pasadena that belonged to one partner’s parent, who needed to move into memory care. The facility had a placement timeline and they couldn’t commit to it until they knew the sale was actually going to close.
They called us more than once asking whether we were really going to close when we said we were.
That kind of back-and-forth shows up on nearly every deal where there’s a hard external date involved. With a traditional listing you’re accepting a best estimate on when it records, and that window can move.
The average sale in LA County at the time was running over a month from accepted offer to recording, and that’s assuming the financing holds and the inspection doesn’t surface anything major.
We closed October 4, 2022 on that condo for $402,500 and they had their funds that week.
A relocation where the new role has already started, or a divorce with a court-ordered settlement date, runs the same constraint, and so does an estate with an administrative deadline. Most sellers in those situations had worked through the close date question before they called us, and the last dollar out of the price usually wasn’t what they were focused on.
The property needs work you don’t want to front
A lot of what we see is deferred maintenance that’s been piling up for years, a roof that’s been put off or an HVAC that’s been limping along. That stuff doesn’t disqualify a retail sale but it changes what the process looks like.
Most agents will tell you to address things before you list, and those fixes cost money upfront and take time, with contractor coordination starting before you’ve even gotten an offer.
A deal that comes to mind involved two sisters who had inherited the family home in Lancaster. Their parents had been in assisted care for a while and the place had been sitting empty.
Neither of them had spent much time there, telling us they’d visited a handful of times in the past twenty years and never actually stayed the night.
Partway through escrow one of the parents passed away. We had to work through the new title configuration and push the close date out while everything sorted.
Through all of that they were pretty clear on one thing: they weren’t filling out the seller’s disclosure. They just really didn’t know what was going on with the house, and there wasn’t any reason they would have.
In deals like that one, the seller’s disclosure is the first thing that complicates the picture, and the list California Civil Code Section 1102 covers goes further than most sellers expect going in.
Properties that have been in the family for years with sellers who have no real read on the condition are something we see regularly. An agent would have wanted an inspection and probably some work done before the listing could move forward, and neither of those sisters was in a position to manage that remotely.
We closed May 2020 on Pearlwood Dr in Lancaster at $215,000.
Some sellers come out ahead by fronting the repairs before they list, especially when the work list is manageable and the cash is available to do it. Cash buyers, including us, buy as-is, and we price the condition into the offer rather than asking the seller to address it before listing.
The repair math varies a lot depending on what the work list actually looks like, and most sellers find the gap between repair cost and recovery is smaller than they’d assumed going in.
You’re managing it from a distance
We bought a house on Flintridge Pl in Escondido in San Diego County from an out-of-state seller managing an inherited property with multiple siblings who all had to agree on the sale. She and her husband lived in Southlake, Texas.
The tenants had just moved out and the house needed updating. She came out for a visit and we talked through what the property would bring at retail versus what we’d pay.
Agents in the area were quoting the family around $325,000. We closed February 2016 at $270,000, and I told her directly that was a real gap.
She was managing the whole thing from Texas with multiple siblings involved and a house that needed work before it could go on the market. She ran the math on what a listing would actually require from 1,500 miles away and landed somewhere different than where she’d started on the price question.
Most sellers in that position end up comparing the headline numbers without running through what the listing would actually cost to get to closing.
What you’re actually giving up
Cash buyers offer less than what a fully marketed retail sale would bring on a property in good condition. I spent seven years as a certified residential appraiser starting in 2003, and the way I build an offer is the same way I used to build an appraisal, working from comps and backing out what the property needs and the risk we’re carrying.
A retail sale isn’t as clean as the listing price makes it look. Most sellers end up paying 5–5.5% in commissions, and since the August 2024 NAR settlement those rates are fully negotiable.
Sellers end up making concessions after the inspection on nearly every retail deal. Carrying costs while the property sits add to that number.
The actual net on a $500,000 retail sale tends to land closer to $450,000 to $460,000 by the time everything comes out. A 5 percent commission takes $25,000 off the top, and inspection concessions and carrying costs for the 90-plus days the average listing runs chip away at the rest.
Most sellers run the comparison against the list price rather than the net, and that gap tends to be smaller than expected when those costs come out. On properties in average condition, the spread between what we’d pay and what a seller would walk away with on a retail sale has come in under $20,000.
A financed deal that falls through mid-escrow sets the seller back in ways the listing price doesn’t capture. The property goes back on market, and buyers notice the relisting, which usually shows up in the price on the second round or in a longer wait before the next offer comes in.
On a $500,000 sale where the first deal fell apart at 60 days, the seller has carried two months of holding costs and paid for a second round of escrow setup. I’ve watched sellers net $15,000 to $25,000 less on a re-list than they would have on the first deal, and usually that gap has nothing to do with the property itself.
Most sellers working through that comparison haven’t run the full cost picture, and once they do, the gap tends to close more than they’d expected. We put together what those costs typically look like for anyone who wants to run the full picture against a cash offer.
A cash buyer’s offer is fixed, and that takes testing the market off the table. Sellers who have time can usually do better by listing and holding out if the early offers come in weak.
Sellers with time and a property in solid shape will generally get more through a listing. Most of the sellers we end up working with had already looked at that path and decided it wasn’t going to work for their situation.
When it probably doesn’t make sense
If the house is in solid condition and you’re not under time or logistical pressure, a retail listing is probably the better path. Sellers who have the flexibility to list usually get more for it.
That’s not a business pitch most sellers expect to hear, but the deals I don’t want to be in are the ones where I pushed when the situation didn’t call for it. Early on, most of what I’m sorting through is whether a cash sale actually fits before we get to any numbers.
If someone has a clean house with no complications and isn’t up against a timeline, I’ll say to talk to an agent first.
A lot of people appreciate that, and it tends to make the rest of the conversation more direct than it would be otherwise.
The sellers we tend to work best with have something going on that makes the retail path harder. Usually it’s a property that needs significant work before it could go anywhere near the MLS.
Or they’re out of state trying to coordinate from a distance, often with a tenant situation or title complication layered in. By the end of that first conversation, it usually becomes clear which direction makes sense, and if they’re not a fit I say that before we get into details.
How to evaluate a cash offer
Not everyone running “we buy houses” ads operates the same way, and the contract is usually where the differences show up.
Proof of funds is the first thing to ask for, and that document should match the offer amount and come from a source that’s actually verifiable.
I’d watch the close date and the assignment language on any contract before signing. Most sellers I’ve talked to who ran into trouble on a cash deal didn’t have an attorney review the purchase agreement first, and that includes deals with us.
Open-ended inspection periods and vague assignment clauses are the two things that give the buyer room to renegotiate or flip the contract to someone else after the seller has committed.
Most legitimate buyers won’t have a problem with those questions, and we covered what the warning signs in cash buyer contracts usually look like for sellers who want to know what to watch for going in.
iBuyers like Opendoor and Offerpad are a different category from the local investor or “we buy houses” buyer, and sellers sometimes compare the two offers directly without accounting for the difference. Their offers are algorithmic and tend to land closer to market value, but they build a service fee of 5 to 8 percent into the deal, and that often brings the net close to what a local investor would offer on the same property.
Most iBuyer programs focus on properties in reasonable condition and won’t engage on heavily distressed houses or ones with complicated title. I’ve talked to sellers who received an Opendoor decline and hadn’t understood yet that the local investor offer they were comparing against was using a completely different pricing model.
A seller who goes out to two or three buyers at once can see where the market actually prices the property. Buyers who are serious about closing won’t push back on a seller running that kind of process.
Offer price is only one part of the picture, and a higher number with a long or open-ended contingency period can close below a tighter offer that has a specific date and a proof of funds letter attached. I’ve seen that play out in transactions we got into late, where a seller came to us after a financed deal fell through and the original offer price was the only thing they’d been looking at.
A note on who we are
We’re a cash buyer, so I’m not neutral here and I don’t think pretending otherwise does anyone a favor. We’ve been purchasing homes directly from sellers in Southern California since 2008 and we’ve closed over 400 transactions, most of them off-market and direct to seller.
We’re not the right fit for every seller and we tell people that on the first call. The sellers we work with tend to know they’re trading some upside for certainty and they’ve decided that trade makes sense for their situation.
We walked through the full process at our how it works page, from the first call through closing, if you want to understand what that looks like before reaching out.
If you want to talk through your situation
You can reach us at (951) 331-3844 or request an offer through the site.
I’m happy to spend 20-30 minutes on the phone understanding what’s going on with the property and your situation, and if a cash sale isn’t the right path I’ll say that before we get into numbers.
Doug Van Soest co-founded SoCal Home Buyers in 2008 after seven years as a certified residential appraiser, starting in 2003. He and Andrea have closed over 400 transactions across Southern California.
