Selling your home as-is sounds like an ideal proposition for any homeowner. An as-is sale tells any potential home buyers that the seller has no intention of doing any repairs or spending any additional monies on the property to make a sale happen. It’s basically a take it or leave it proposition.
While most traditional home buyers shy away from getting involved with this type of sale, investors are intrigued by the thought of an as-is deal. Traditional home buyers worry about what could be wrong with the property and if they have the funds to make it right. Investors, on the other hand, see the as-is sale as an opportunity to acquire a property below market value. Investors generally have the knowledge and resources available to deal with the problems that arise in this type of transaction. They also know there won’t be a lot of competition for the property because the “As-Is” designation will have ran off most of the traditional home buyers.
Both Buyers and Investors can do a property inspection and if the findings are too much for the purchaser to deal with, they do have the opportunity to get out of the transaction. This is where the as-is sale can get to be a headache for the home seller. In spite of the fact that the sale was intended to be “as-is,” the buyers and/or investor will most likely ask for repairs to be made or at least some financial compensation for those repairs. If the property has been priced competitively, the home seller can stand their ground confidently knowing that there will be another purchaser waiting and eager for the deal.
If on the other hand, if the repairs and problems are not priced into the home price, the line of potential buyers may not be very long or exist at all. In this case, the home seller can still stand their ground but may have to wait a while for another buyer to come along. Who’s to say the next buyer won’t have the same issues as the first buyer. This is the struggle for the “As-Is” home seller, they may go through several potential deals before finally arriving at one that will actually close.
A Better Plan
“As-Is” sales are not for everyone, banks and estates tend to be the best candidates for these types of sales. These are situations where the estate or institution acquires the property and are simply looking to liquidate the asset. They have never lived in the property, so they really don’t know what the conditions is, therefore they don’t have anything to disclose.
A traditional home seller that has lived in the property knows the problems with the property and has a responsibility to disclose anything they know that would negatively impact the condition of the property. Simply sticking an as-is into MLS description does not alleviate the seller from their duty to disclose.
If you are considering selling your home but are concerned with the consequences of truthful disclosure, there is a better plan than Selling Your Home in As-Is Condition.
- Start with a pre-inspection-This will give you an idea of where you are at in terms of repairs
- Get Bids to Make Repairs-This helps with figuring out what the list price of the home should
- Price Correctly-Take the repairs into consideration and price the home correctly
- Disclose- If you don’t want to worry about having to deal with the buyer after the sale or potential lawsuits, Disclose what you know
While the idea of an as-is sale sounds like a good idea for the home seller, the ramifications can be pretty serious. Wasted time, legal problems and more are the potential problems. Why not be open, transparent and honest in your real estate dealings, it is the best policy.