Selling a home can be a long, drawn-out process that can cause homeowners stress. There are a lot of decisions to make, and one of the first is deciding whether to sell your home as-is or make repairs and updates first.
There are many reasons why selling your house as-is can seem like an attractive option, but first, it is essential to be clear about what selling as-is means.
What does it mean to sell a house as-is? Selling real estate as-is means putting a property up for sale without making any repairs or improvements to its current condition. However, an as-is home sale does not mean that you are free from disclosing any known issues about the state of the house.
You are still legally obligated to fill out a seller’s disclosure, where you must document any details you know about the property’s condition and honestly answer any questions regarding the state of the house.
Deliberately hiding things that can influence the buyer’s decision to buy your property can cost you later in legal fees. Selling your house as-is does not prevent the buyer from doing a home inspection and uncovering any other issues you might not have known about.
Financial hardship, illness or other life circumstances, or simply wanting to make a quick sale are the most common reasons for selling a home as-is. Whatever the reason, it’s essential to be aware of the pros and cons of selling your house as-is and what it entails before making the right decision.
When you sell your home as-is, you are not obligated to pay for any repairs either before or after the buyer’s home inspection. Although a home inspection might reveal issues about the house that even you did not know about, you are not obligated to make the repairs, and the buyer is aware that they are in no position to negotiate. With that said, keep in mind that a home must be habitable before the buyer can obtain a loan (if it is not a cash sale). If there are issues such as no operable kitchen, open walls, no flooring, or any other condition that makes the house uninhabitable, the buyer will not be able to secure a loan to buy your home. As a result, you may still incur costs for the property to be sellable.
Selling your home as-is is saves time because as-is homes on the real estate market attract real estate investors who flip properties and sell for a profit. Most of these investors pay cash, and closing the sale can take a lot less time (as little as a few days or weeks instead of months).
In this scenario, you are not likely to get the total value of your home, but you will not have to waste time waiting for the right buyer and other things that make the road to closing the sale a long and arduous one.
If you are in financial distress and need the money in a hurry, some companies specialize in buying houses in these types of situations. They can offer an almost immediate sale, saving the necessity of going through many of the stages of selling a home. If you choose this route, be prepared to be low-balled when they make an offer because they aim to pay the least amount they can.
Selling a home as-is or otherwise is a stressful process. While selling your house as-is is not without challenges, it certainly is a lot less stressful. You will not have the financial burden of paying for repairs and renovations before putting it on the market, and the selling process is relatively faster.
When considering the pros and cons of selling a house as-is, the first and biggest con is a lower selling price. It’s truly the single biggest drawback to selling as-is. Your home’s selling price is determined by its condition and how much work needs to be done to bring it up to standard. Since as-is homes tend to attract those looking to buy fixer-uppers and flip them for a profit, these buyers will typically make lower offers.
When selling a home as-is, you face a smaller pool of buyers willing to take on the work of repairing the property. Most buyers are looking for homes that have been inspected, repaired, and renovated, reducing potential buyers to those buying with cash or companies specializing in buying homes for a quick sale.
Sellers are legally required to disclose everything they know about the condition of their property, but many do not, and buyers are aware of this, fostering a degree of distrust from the buyer’s perspective when it comes to as-is homes. When a home is listed for sale as-is, buyers might anticipate its condition being worse than it is because of this distrust. Based on this distrust, buyers tend to make lower offers in anticipation of problems that might not be there.
These are some of the more significant pros and cons of selling your house as-is. Taking the time to do research, assessing your priorities when it comes to selling your home, and getting a good idea of your financial situation are steps you can take in deciding what is best for you.
If you want to know more about the pros and cons of selling real estate as-is, it is best to speak to an experienced real estate agent, preferably one who has managed many as-is home sales and knows the ins and outs of how to sell a home as-is. They can best assist and guide you along the way.