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Cash offer vs. listing: what you actually net

A listing brings more, then gives some of it back in commissions, repairs, concessions and carrying costs. A cash offer brings less and gives almost nothing back. Here are the net numbers side by side.

01Two columns, not one number

The headline price on a listing is not what you take home, and the headline price on a cash offer is closer to it than people expect. The honest comparison is net proceeds: what reaches your account after everything on the settlement statement, minus what it cost you to get there.

A listing costs commissions, which have become negotiable but still run about 4 to 6% between both sides, plus repairs to get through inspection, plus concessions the buyer asks for after inspection, plus every month of mortgage, taxes, insurance and utilities while the house is on the market and under contract. A cash offer costs the discount and a few percent of closing costs.

02The net on a $400,000 house

What reaches you, before paying off the mortgage
ListingCash offer
Sale price$390,000 to $400,000$320,000 to $360,000
Commissions$16,000 to $24,000$0
Repairs before listing$3,000 to $15,000$0
Concessions after inspection$0 to $10,000$0 to $10,000 as a repair credit
Carrying costs, 2 to 3 months$5,000 to $9,000$1,000 to $2,000
Seller closing costs$4,000 to $8,000$3,000 to $7,000
Net proceedsAbout $335,000 to $365,000About $305,000 to $350,000

Read the overlap in that last row carefully. A strong cash offer on a house in decent shape can land within $15,000 of a listing's net. A weak cash offer on a house that would have shown well can land $60,000 behind. The gap depends almost entirely on which cash offer you got and what shape the house is in.

03What the table leaves out

  • Time. Two or three months of your life spent keeping a house ready for strangers, and the possibility that the first buyer's loan fails and you start over.
  • Certainty. A listed house might not sell at the price the agent suggested. A cash offer is a number you can plan around.
  • Your own labor. Clearing out, cleaning, painting, meeting contractors. For an absentee owner, each of those is a plane ticket.
  • The next move. If a delayed closing means losing a house you are buying, or paying rent and a mortgage at the same time, the listing's extra net shrinks fast.

04When the gap is worth paying

Put a dollar figure on each item above. If the listing nets $40,000 more and the house would sell in a month with modest work, that $40,000 is worth a month. If the listing nets $15,000 more and getting there means two trips across the country and a contractor you have to find from a distance, the cash offer starts to look like the cheaper option.

Either way, run the comparison with a real listing estimate and a real cash offer in hand, not with the ranges on this page. How cash offers are priced helps you judge whether the offer you have is a careful one.

See where you actually land

Your address, a value and equity range, then the paths that fit. About a minute, and no credit check.

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Related

  1. How cash offers are pricedEvery cash offer starts from what the house will be worth fixed up, then subtracts repairs, holding costs, selling costs and the buyer's margin. Here is the formula and why two offers on the same house differ by tens of thousands.
  2. When a cash offer is the right call, and what it costs youA cash offer is fast and certain. You skip repairs and showings. You also net meaningfully less than a traditional sale.
  3. The cash offer timeline, from offer to fundedMost cash sales close in 7 to 21 days. Here is what happens in each stretch, how your mortgage and any second lien get paid, when you have to be out, and what can slow it down.

This path, in order

Cash offer: the full guide

  1. 01When a cash offer is the right call, and what it costs youA cash offer is fast and certain. You skip repairs and showings. You also net meaningfully less than a traditional sale.
  2. 02How cash offers are pricedEvery cash offer starts from what the house will be worth fixed up, then subtracts repairs, holding costs, selling costs and the buyer's margin. Here is the formula and why two offers on the same house differ by tens of thousands.
  3. 03Cash offer vs. listing: what you actually netYou are here
  4. 04The cash offer timeline, from offer to fundedMost cash sales close in 7 to 21 days. Here is what happens in each stretch, how your mortgage and any second lien get paid, when you have to be out, and what can slow it down.
  5. 05Taxes when you sell, in plain termsMost people who sell the house they live in owe no federal tax on the gain, up to a limit. Here is the shape of the rule, what basis means, and how inherited houses differ. The outline, without the advice.
  6. 06Cash offer red flagsMost cash buyers are what they say they are. The ones who are not share a few habits: contracts they can assign, long inspection periods, tiny deposits, and prices that drop after you sign. Here is what to look for.