The math · Michigan · Houses that need work
Cash offer vs. listing: what you actually keep on a house that needs work
A listing shows you the sale price. A cash offer shows you the check. On a house that needs work, the gap between those two numbers is usually smaller than it looks, because listing means paying for repairs, two commissions, Michigan transfer tax, title, an inspection credit, and four months of carrying costs before you see a dollar. Below is the full arithmetic on a typical Oakland County example, with every assumption labeled so you can swap in your own numbers.
What does listing a house that needs work actually cost?
Take a house that would sell for $290,000 once it is fixed up, and needs about $40,000 of work to get there: a roof, a furnace, flooring, paint, a kitchen that is decades old. Here is the seller's side of a listing, using published 2026 Michigan figures.
| Listing path | Amount |
|---|---|
| Sale price after repairs | $290,000 |
| Repairs before listing | − $40,000 |
| Listing agent commission (3%) | − $8,700 |
| Buyer's agent concession (2%) | − $5,800 |
| Michigan transfer tax ($8.60 per $1,000) | − $2,494 |
| Owner's title policy + settlement fee (~1%) | − $2,900 |
| Inspection repair credit | − $3,000 |
| Holding costs, 4 months | − $4,800 |
| Net before mortgage payoff | $222,306 |
Total cost of selling: $67,694, or about 23% of the sale price, and $40,000 of it is cash you spend before the house is even on the market. The holding line assumes 4 months of taxes, insurance, utilities, and upkeep at about $1,200 a month while it is being repaired, listed, shown, and closed. If you carry a mortgage, add that payment too.
What does a cash offer look like on the same house?
There is one line. The offer is the number you keep at closing, minus any mortgage payoff. No repairs, because we buy the house as it sits. No commission, because there is no agent. No closing costs, because we cover them. No holding costs, because we close in two to four weeks on the date you pick, and no inspection credit, because the price already reflects the condition.
We will not quote a fake number here. A cash offer on a $290,000 after-repair house needing $40,000 of work is normally below the $222,306 listing net, because the buyer is taking on the repairs, the risk, and the carrying costs you would otherwise pay. In our experience the gap on a house like this is often between $5,000 and $20,000, and it narrows or disappears when repairs run over budget, the first buyer's financing falls through, or the house sits into a slow season.
When does listing win?
- You have the $40,000 in cash and can wait four to six months for it back.
- The house needs cosmetic work, not systems, so a modest budget moves the price a lot.
- You are in no hurry and a mortgage is not draining you every month.
- Your area has strong retail demand and a listing agent you trust.
When does a cash sale win?
- You inherited the house and are paying taxes and utilities on a place you do not live in.
- You are behind on payments and every month costs you equity.
- The repairs are structural, or the house would not pass a buyer's appraisal or loan condition standard.
- You are a landlord done with tenants, turnovers, and code letters.
- You need a certain closing date: a job, a move, a divorce settlement, an estate to close.
How to run your own numbers
Take the price a repaired version of your house would bring. Subtract the repair bids you actually have, 3% for the listing side, 2% for a buyer's agent, $8.60 per $1,000 for Michigan transfer tax, about 1% for title and closing, a repair credit after inspection, and your monthly carrying cost times the months you expect to hold. That is your listing net. Put it next to a written cash offer and choose. We are happy to be the second number.
Questions we hear
Is a cash offer always lower than what I'd get by listing?
Usually the offer is lower than the listed sale price, and usually it is closer to the listing net than sellers expect. The buyer takes on the repairs, the carrying costs, and the risk that the house sells slowly. In our experience the difference on a house that needs work is often in the range of $5,000 to $20,000 after all listing costs, and sometimes cash comes out ahead when repairs run over.
What closing costs does the seller pay in Michigan?
The seller normally pays the Michigan transfer tax of $8.60 per $1,000 of price, the owner's title insurance policy, a settlement or closing fee, any agreed repair credits, and prorated property taxes. Listing adds the commissions. In a cash sale to us, we cover the closing costs; your mortgage payoff still comes out of the proceeds.
Can I just list it as-is and skip the repairs?
You can, and some sellers should. Expect the offers to reflect the work, expect more buyers to walk after inspection, and expect longer days on market. Financed buyers also need the house to pass an appraisal and, for some loans, a condition standard, which a house with roof or foundation issues may not meet.
How fast can a cash sale close?
Typically two to four weeks, set by how quickly title work clears and the date you choose. There is no lender, so there is no appraisal or loan approval to wait on.
Do I have to accept the cash offer?
No. Our offer is written and free, and nothing is binding until a purchase agreement is signed by both sides. Take it to a listing agent and compare the net. We would rather you choose with the full math in front of you.