There is a lot of work involved in getting your home ready to sell – from handling repairs, replacing fixtures, and enhancing curb appeal. If you are the kind of home seller who doesn’t want to go through all that hassle, then you might want to consider the selling “as is” route.
Selling a home “as is” means exactly what it sounds – the buyer gets the property in its current condition, without any repairs, renovations, improvement, or upgrades.
People list “as is” for obvious and practical reasons. They don’t want to spend time and money on the repairs, and they want to sell the property as quickly as possible. Most real estate transactions include some sort of bargaining. A buyer might request a specified amount of credit (say $2,500) if a home inspector finds serious problems (plumbing or roofing issues, for example). However, when a property is listed “as is,” that means the seller will not address the existing problems.
Generally, properties listed “as is” are priced lower, since the buyer will have to shoulder the repairs and additional work that needs to be done once the transaction is completed.
Note that selling “as is” doesn’t change the rights of the buyer to be informed of the existing and potential problems with the property. The buyer can also negotiate the price, depending on the home inspection.
As said earlier, there are two main reasons why people opt for this option – to save money and time.
Let’s say you need to move to a different city and unload your property as fast as possible. Searching for and hiring a contractor to do the necessary repairs and updates to your home to make it look appealing in the market can take serious time. If there are enough people looking to buy a property, and you are confident that your property will sell, then selling your home “as is” might be the best way to speed up the whole process.
Furthermore, a property that is in poor condition requires a significant amount of money to be fixed. This could go to tens of thousands of dollars. Selling the property “as is” gives you the opportunity to skip the expensive repairs, renovations, and remodeling upfront.
Use this guide to help you decide if you want to sell your home “as is” or not.
Faster closing
Since you don’t need to wait for the repairs to be finished, you can put your house on the market as soon as you want. Assuming your potential buyer has the money (or loan access); you can speed up the whole process. Most buyers of this kind of property are usually investors and house-flippers who want to acquire new properties to remodel and sell quickly.
Cheaper cost
Again, no need to do the repairs, remodeling, or renovations. But aside from that, you don’t need to shell out money for staging. That means less pressure on you to make your property look perfect in showings.
Minimize haggling
Price negotiations are normal in real estate. Following findings from the home inspection, buyers get $14,000 off the final price on average. With the ‘as-is’ route, however, you can set the price and tell your potential buyers you cannot go lower than the set price for credits or repairs. This can save you both money and from the stress of dealing with back-and-forth haggling.
Expect lower offers
It’s undeniable that -is” listings often conjure the image of a creaky old shack and sellers looking to cheat unsuspecting buyers. Thus, you may not always get the full value of your property. Many will make low-ball offers. If you’re refusing to make the quick but necessary repairs, then you may be leaving some significant amount of money on the table by allowing buyers to devalue your property over minimal issues.
You may turn off some buyers
As mentioned above, the“‘as-is” tag has garnered some negative connotations over the years. For many, they see it as a red flag. As a matter of fact, many home buyers feel more comfortable giving higher offers for properties where they can request repairs after inspections. Putting an “as-is” tag on your listing may seem like you are unwilling to work with them.
Repairs aren’t completely off the table
Just because you listed “as-is” doesn’t mean buyers will not request and negotiate for the cost of the repairs. Obviously, it is still within your discretion to accept the buyer’s offer.
Ask your realtor
If you are looking to sell your home “as is,” make sure you ask for advice from a realtor. They know the market better and they know how to attract and find buyers who are interested in your kind of listing. More importantly, when it comes to closing deals, they have the skills and experience to do it fast and negotiate with your best interest in mind.
Disclose everything
An “as-is” tag is not an excuse for you to hide any existing or potential issues in your property. As a matter of fact, most states in the country mandate full disclosure of any problems of the property. Failing to disclose important information opens you up to legal liability after the close of escrow.
Also, it pays to know the legal requirements for disclosures in your state. Each state has its own requirements for this, so make sure you ask your agent about it. He/she is familiar with the disclosure laws and can guide you through the process.
Put the “as is” label in your listing
Unless the listing specifically says the property is “as is,” then buyers will assume it’s a regular home sale.
By adding the “as is” label, you are helping your agent to find and connect with the right buyers for the property. At the same time, the potential buyer knows exactly what he/she is in for, saving you from the stress of worrying about doing any repairs.
Get your property inspected
Before you make a listing, make sure your property is checked by a home inspector. As the seller of the property, it is your responsibility to know everything that is wrong with the house. While at it, ask for an estimate for all the potential costs that may be needed to fix the problems. This can help you set the right price for the property and deflect any curveballs potential buyers may throw at you.
Set a realistic price
Find the sweet spot for your pricing. Don’t let your ego set an unrealistically expensive price, but do not lowball yourself either. Again, ask your agent to calculate the best and most realistic price for your property.