Module 3: Should you Rebuild or Sell?

Rebuilding is a huge undertaking, and it isn’t the right choice for everyone. Many people don’t realize that most insurance policies allow you to take a payout and sell the property instead of rebuilding.

If you choose not to rebuild, here is how the math usually works:

The Payout: You typically receive the Actual Cash Value (ACV). This is the total cost to rebuild your home minus "depreciation" (the value lost due to the age and wear of the house).

What you give up: You only get the depreciation money back after a rebuild is finished. If you sell, you lose that portion of the insurance money.

The Strategy: To get the most money possible, you need a very detailed rebuilding estimate. The higher the initial estimate, the more money you’ll walk away with—even after the insurance company subtracts for depreciation.

Next Steps:

Check your policy: Make sure your specific plan allows for this option.

Potential Buyers: There are often investors who are willing to buy damaged properties at a less than market rate value. Ask around to get an idea of what your property may be worth so you can weigh your options. 

Think it over: There are many great reasons to sell rather than rebuild. Take your time to decide what works best for you.