Buying a Home For Sale "As Is"
A growing number of people have been presented with the opportunity to buy a home as is. From those looking for a primary residence to real estate investors, these properties often times have a lot to offer. That being said, it is important for buyers to realize that there are both pros and cons.
What does As Is Mean?
Before you do anything, you need to know exactly what it means to purchase a home as is.
Generally speaking, when sellers list a home as is, it means they are not willing to negotiate with the buyer regarding any repairs or credits. Instead, they are selling the home in its current condition.
While the buyer is allowed to get an inspection as a means of determining if the home is in good condition, the seller has no obligation to make any repairs before the deal moves forward.
Due to the nature of an as is sale, it is typically best for the buyer to opt for a home inspection. Some items of repair are not that big of a deal, but others, such as mold or a cracked foundation, can cost a lot of money.
Are Properties Sold As Is a Good Deal?
There is no right or wrong answer to this question. It all depends on the property, the asking price, and how much risk tolerance the buyer has.
In many cases, an as is sale is a good deal because the owner simply wants to get rid of the home without any stipulations.
On the other hand, there is always reason to be cautious with this type of sale. If the price is too cheap to believe, for instance, this should throw up a red flag in your mind.
As Is is not Always As Is
Just because a seller is marketing their home as is doesn’t mean you are stuck in a “take it or leave it” position. This may be what the seller wants you to believe, but it doesn’t have to be true.
For example, it would be in the seller’s best interest to obtain a pre-sale inspection. Not only will this put them in position to make any repairs that could kill a deal, but it would give potential buyers peace of mind.
Tip: any buyer who enters into an as is purchase agreement should add an inspection contingency as an added layer of protection.
Disclosure Still Required
Despite the fact that you may be purchasing a home as is, this doesn’t mean the seller can get away with withholding a disclosure.
State law requires the seller to complete a disclosure. This will more or less tell you if there have been any problems with the home in the past, as well as the current condition.
Review the disclosure in great detail, as this will provide you with critical information. From past problems to the age to repairs, you are going to learn quite a bit.
How Much should I Pay?
This is one of the most common questions among those interested in an as is property. While you may be thinking you are going to get the home for cheap, this is not always the case.
To ensure that your offer is in line with the rest of the market, rely on the assistance of a local real estate agent. Along with this, search for an as is home that meets the following requirements:
- Home is new and appears to be cared for.
- The seller is willing to share the disclosure before you make an offer.
- The seller has paid for a pre-sales inspection, giving you a better idea of the overall condition of the home.
Some as is homes are considered fixer uppers while just as many don’t need any major repairs. This can and will change from one property to the next.
As long as you are aware of the advantages and disadvantages of buying as is, nothing should stop you from making an informed and confident decision.