Selling a home “as-is” simply means selling a house in its current condition. In other words, the homeowner is selling their property with all of its faults and blemishes, with no intention of making repairs.
So what are some of the reasons a homeowner would choose to sell as-is? Below is a list of the top 3:
- Limited funds to make repairs. Most homeowners who decide to sell as-is do so because their home has material defects and they don’t have the financial resources to cover major repairs or renovations.
- Lack of time. Some homeowners my find themselves in a situation where they need to sell quickly. This could be due to divorce, job loss, illness, job relocation, etc. Regardless of the reason, selling your house as-is means you won’t have to wait until any repairs are completed, which could take months. Additionally, many of the potential buyers will be investors, many of whom can pay cash and close in as little as a few weeks.
- The stress of a major home renovation project. Some individuals simply don’t have the stomach to go through a major home renovation project. If you own a home that needs major updating and/or repairs and would rather not live in construction zone for the foreseeable future, then selling as-is may be your best bet.
So what are the potential drawbacks to selling as-is?
- Automatically exclude a large number of buyers. Let’s face it, a lot of people that see a home in need of repair think “work” instead of “fun.” Selling your house “as-is” is basically announcing to the world that your house is in need of repair and/or major updating. So every non-handyman and non-DIYer is going to pass right over your listing.
- Low-ball offers. Selling as-is will bring in a lot of people looking for bargains. With bargain shoppers comes low-ball offers; some of which will be downright insulting.
- Selling below market value. This doesn’t mean you have to accept one of the low-ball offers I mentioned previously, but you will have to sell at a discount; as opposed to full market value if you were to do all of the necessary repairs and/or updating. How big of discount depends on how many repairs or how outdated the house is.
Selling a house “as-is” is an option homeowners with a house in need of repair and/or updating should consider. However, every home sale is unique and homeowners should entertain all options before deciding on a strategy.
*This article is intended solely for informational purposes only.