Can You Sell a House With a Broken Air Conditioner?

Don’t miss the quick fire Q and A just below!

“Can I sell a house with a broken air conditioner?”

It is possible to sell a house with a broken air conditioner. However, it might be much harder to find a buyer, or you might have to list your house at a much lower price to get a buyer.

This could be especially true when trying to sell a house in the hot Denver summers. I remember the first time I got a house with an ac unit. It made a huge difference for me!

Selling without or with a broken ac unit in Colorado.

Let me ask you a quick question: Are you trying to sell your house without spending any money? If so – by all means sell without fixing the ac.

On the other hand, repairing or replacing the broken air conditioner may improve the value of your house and increase the chances of getting a buyer fast.

With that said, replacement or repair does not always guarantee increasing value. This is because the standard expectation is that houses should have an air conditioner.

Therefore, it is up to you to determine if it will benefit the entire sale process to replace or repair the broken air conditioner or leave it as is.

How much value does AC add to the sales price of my house?

Just how much value AC will add to the sales price of your house depends on a few factors that, include the following:

Time of year you sell your house.
The location of your house.
Whether or not other houses in your area have AC too.

Let’s discuss these 3 bullet points briefly.

TIME OF YEAR:

If you sell your house in the winter when it is cold, a new AC unit will not increase the value of your house that much. If you sell your house in the summertime and it is blistering hot outside, then a new, well-functioning AC unit could add $10,000 or more! This is especially the case if your house is the only one on the block with AC.

Picture this: It is 95 degrees outside, and a potential buyer has just been into 5 houses for sale.

Yours is the only one with AC.

Because of this, when the buyer steps into your house, it is lovely and cool. Compared to all the other houses that are hot inside. The buyer loves how cool it is in your house. And because of this, they will pay more for your house.

Make sense?

LOCATION OF YOUR HOUSE:

If you live in a city that is always cold, then AC won’t add as much value to your house as in a hot city.

DO OTHER HOUSES HAVE AC TOO?

If every other house in your neighborhood has AC, then it will be expected that yours does too. In this scenario, a property without AC will sell for less. It could be $5,000 less, or it could be $10,000 less.

If the same property has a working AC, replacing it with a brand-new one will not add much value.

What can I do if my AC is broken when selling my house?

You have several options if you sell a house with a broken AC unit.

Sell your house as-is
Repair the broken AC unit
Replace the AC unit.

Let’s discuss each scenario.

SELL YOUR HOUSE AS-IS:

If you sell your house as-is, you will save money on the front end because you won’t have to repair or replace the unit. Fixing an AC unit could be $200 or run as high as $10,000 or more!

However, if you sell your house as-is, you will have to discount the sales price. Because of this, you may lose more money in the long run.

You need to determine how much more your house will sell for if the AC works.

HOW TO WORK OUT HOW MUCH MORE YOUR HOUSE WILL SELL FOR:

To work this out, you need to look at comps. Find a number of houses that sold with and without AC. The differences can partly be accounted for by whether or not the house had a working AC unit.

Is my house worth more if I replace the AC unit?

According to most real estate investors, replacing a working AC unit with a brand-new one will not increase the value of the house that much. Real estate investors would consider replacing the unit as a lousy investment.

Replacing the unit is a bad investment because the cost of the replacement would be greater than the increase in the value of your home.

If you are replacing a unit that is not working, it could be worth the investment. If the unit is completely broken, the house could sell for considerably less than the same house with a working AC.

Is it worth it to replace AC before selling a house?

If you are selling your house and the AC unit is currently working, it is not worth replacing it.” said Brandon Fischer of Executive Realty.

Brandon continued: “Instead, you might like to get it serviced and cleaned. Present this report to potential buyers showing them that the unit is in good working condition.”

Factors to Consider When Determining Whether to Repair a Broken Air Conditioner Before Listing a House for Sale

Below are the key factors to consider when determining whether to repair a broken air conditioner before listing a house for sale.

The extent of the damage

Is the air conditioner completely broken, or does it work? Does the entire system need to be replaced or just a part? What is the model of the air conditioner, and can you find replacement parts easily? How long would the replacement or repair process take, and would the listing and sale schedule get in the way?

Is the ac the only thing you have to repair? Are you selling your house without a fridge or stove? Are there other items you should focus on instead? If the list of things to fix is too long, maybe you should sell your house as-is.

If the unit was serviced regularly or if its warranty is due

If you have been keeping up with the air conditioner’s routine maintenance schedule, the damages may not be extensive and can be affordably repaired.

Otherwise, they may be extensive, and you would need to replace the entire unit. Similarly, if you have an old unit whose warranty is almost due or already due, the damages likely indicate that it has done its time and needs to be replaced.

Do you live in an area where an air conditioner is pivotal?

If you live in a region where an air conditioner is unnecessary, you might get away with not repairing or replacing a broken unit. This might be up in the northern states.

On the other hand, if you live in an extremely hot or humid area, an optimally working air conditioner is vital. Also, if you sell your house during the summer, the air conditioner must work.

We all know that Denver can get hot in the summer. It only lasts for a few months, but the air conditioning is nice on those hot nights!

I don’t know about you, but I sweat a ton in bed when its hot outside and inside! I was so excited when I finally got a house with ac. Sleeping was way more comfortable for me.

PRO TIP: If selling a house unoccupied in Denver during the summer, I suggest turning the ac off – and this is why. Denver and Colorado houses can fall prey to squatters. Squatters may stay longer if it’s hot outside and your house has air conditioning. Now you have an added problem when trying to sell your house.

If the power is on, you can’t turn off the utilities on the squatters. This is because in Colorado, squatters have rights. There are laws you must follow.

This is one of many prevention tips if you don’t want vagrants, squatters, and unwanted guests living in your house.

Do you have a budget for repairs or to buy a new AC?

Depending on the extent of the damage, repairs can cost as low as $100 up to thousands of dollars in replacement parts and labor costs. A good rule of thumb for determining whether to repair or replace a broken air conditioner is multiplying the unit’s age by the repair cost. If it exceeds $5,000, replacing the broken unit with a new one is more cost-efficient than replacing it.

Homeadvisor.com says the cost of installing a new AC unit ranges from $3800 for smaller units to $7500 for larger ones. If you add labor costs and permit fees, the total cost may exceed $12000.

There are many selling situations in this might not add up. For example, if you are selling your house for $1.00 to your son. You are already giving him stellar deal. Do you really want to drop another $12,000 on the house. That would be a hard pill to swallow.

If replacing the unit is the best option, go for one that is energy-efficient, environmentally friendly, and most compatible with your existing HVAC system. Keep in mind that the unit does not have to be big to be better.

Most modern air conditioning units are designed to be space-saving, aesthetically appealing, and energy-efficient. Also, ensure that the new air conditioner meets the SEER 14 standards and has a reasonable warranty against defects.

Are you willing to deduct the cost of repair or replacement from the sale price?

You will have to repair or replace the unit if you want to keep the listing price within the fair market value.

If you choose not to repair the air conditioner, have a specialist assess how much it would cost to repair or replace the unit and deduct the amount from your sale price.

You are also obligated by the law to disclose in the sale agreement that the air conditioner is broken.

Response from potential buyers

If the house has already been listed and some potential buyers have had a chance to view it, what was their reaction?

Were there some that considered buying the house as is, or were a majority put off by the broken air conditioner? If the latter, it is best to replace or repair the broken air conditioner to improve your chances of closing a sale.

Advantages of Repairing/Replacing a Broken Air Conditioner Before Listing the House for Sale

Improves the overall perception of the buyers towards the house and the seller. It depicts the seller as responsible. If you have upgraded the broken unit with a new one and you highlight it in the property description, it may give potential buyers confidence in the property. Besides, the last thing you want is for potential buyers to walk into a stuffy house on the open day. It would put off most buyers before they view the rest of the house.
Enhances energy efficiency. A broken air conditioner can increase your energy bill significantly, even within the sale period. Besides, as energy bills increase, more and more people are keen to save on energy. Installation of an energy-efficient air conditioner may give your house a competitive edge.
Helps your house to compete effectively with similar properties in your neighborhood. If similar properties in your neighborhood have properly working or new air conditioners, listing your house with a broken air conditioner will cause your property to lag behind the competition.

Disadvantages of Repairing/Replacing a Broken Air Conditioner Before Listing the House for Sale

It can be quite costly. As mentioned earlier, repairing or replacing a broken air conditioner can cost thousands of dollars.
Repair or replacement may require renovation or remodeling of parts of the house. For instance, if the new unit is bigger, you would have to replace HVAC ducts, install, and even break down some walls. All of this can prove to be more expensive and time-consuming.
The buyer could be set to install an air conditioner unit of their liking. A potential buyer might not care that the air conditioner is outdated or broken because they are set to renovate the house once they buy it. Therefore, repairing or replacing the broken unit wastes time and money for such a buyer.

Should You Replace/Repair a Broken Air Conditioner or Leave It?

The answer is that it depends on the factors discussed early in the article. If you have some money to spare, replace the broken unit as it could improve the value of your home. If not, leave it as is but indicate this on the disclosure form in the sale agreement.

If you leave it as is, remember that it may put off some potential buyers, and it may take much longer to sell the property. Also, buyers who agree to buy the house as is will most likely negotiate for a lower price reduction.

As such, if you have a tight timeline to sell the house, like a short sale or a looming foreclosure, repairing the broken unit can improve your chances of getting a buyer and closing fast.

Can You Get a Home Warranty on a Broken Air Conditioner?

The simple answer is no. Home warranties do not cover appliances that are already broken.

However, if you anticipate that your central air conditioner may break down within a few months of the new buyer acquiring the house, getting a warranty for air conditioning repair may be a viable option for cushioning the new homeowner.

In this case, consider taking a comprehensive home warranty to cover all appliances in the house. It costs $300-$600 and will give you and the seller peace of mind.

Conclusion

Legally, you can sell a house with a broken air conditioner as long as you indicate it in the disclosure form. However, it would be best to repair or replace a broken air conditioner before listing it.

Seeing as the real estate market is quite competitive, even simple things like a broken AC can stifle your effort to sell the house. On the other hand, you might be lucky to find a seller who does not care if the air conditioner is broken.

If you are unsure what to do, consult your realtor on the best course of action. They will advise you according to the market trends and whether they think the broken central air conditioner will limit the house’s ability to sell. They will also guide you through each step of the sale process.

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