Why a cash offer is below retail, and by how much
A cash buyer is not paying what a renovated house sells for, because they are buying an unrenovated one and taking on everything in between: the repair budget, the months of carrying costs, the risk that the budget is wrong, and their own commission and closing costs when they resell.
That is the whole difference. It is not a discount for speed alone — it is the cost of the work plus the return for doing it. This calculator shows those components separately so you can judge whether the trade is worth it for you.
The input that matters most
The repair estimate moves the offer more than anything else, and it is where sellers and buyers disagree most. An owner thinking about cosmetic updates and a buyer pricing a full renovation to current retail standards can be $40,000 apart on the same house.
If you have contractor quotes, an engineer's report, or a recent inspection, use those figures here — and send them to us. Documentation makes an offer more reliable, not less.
What this tool is and is not
- It is a transparent model of how cash offers are built, using figures you supply.
- It is not our offer. We do not price property from a form — we look at it.
- It does not know your local market. The resale value and repair figures are yours to supply, because inventing them would be worse than asking.
- The only rate baked in is your state's statutory transfer tax, cited below.
Frequently asked questions
How do cash home buyers calculate offers?
By working backwards from what the property will be worth once repaired, then subtracting the repair cost, the holding costs while the work is done, their own selling costs on resale, and a margin for the risk and effort. This calculator shows each of those lines.
Is this the offer I would get?
No. It is a model using your inputs. A real offer comes from looking at the property, the title, and the occupancy.
Why does the repair estimate change the result so much?
Because it is subtracted directly and it also drives the holding period. A larger project takes longer and costs more to carry.
What margin is typical?
It varies by market, project size, and risk. Rather than assert a single number, the calculator lets you test a range and see the effect.