Tips for selling “as-is” homes
Whether your client has recently inherited an old home or is simply trying to offload a house quickly, as-is properties are not unusual in today’s real estate market. Fixer-uppers appeal to buyers looking for a bargain or that want to renovate a property to their specifications. But tactics for selling these homes differ widely from market-ready properties. Here’s what to know when selling homes in “as-is” condition.
What does “as-is” mean in real estate?
Listing a property in “as-is” condition indicates that the seller will not be repairing or fixing any issues or problems with the house. The property will be sold in its current state and the buyer will need to sign paperwork indicating that they’re aware of these terms.
Withholding information
It should be noted that selling a home “as-is” doesn’t relieve a real estate agent of their obligation to disclose known faults and existing problems. Rules vary between provinces, states and jurisdictions, so check your local laws on the disclosure of faults and conditions. If issues like pest damage, propensity for flooding or mould are known, the real estate agent cannot intentionally withhold this information.
Home inspections
Even if you choose to skip a home inspection prior to selling, a buyer will most likely be soliciting their own inspection so be prepared for any issues discovered here to be used as leverage for the offer price. Furthermore, if a buyer informs you of major problems revealed during a home inspection and backs out from the deal, you will be obligated to disclose those issues to future buyers.
Mortgage implications
“As-is” properties in disrepair are a riskier venture for banks and mortgage lenders. They may not be willing to lend out money to buyers of properties facing major structural issues or damage. This may limit your pool of buyers to those with cash in hand. But in a heated real estate market, “as-is” homes can still attract multiple bidders, making this a plausible strategy for sellers without the funds for repairs.
