We often come across the phrase ‘selling a house as is’ in context to the property market. Some are quite wary of the words and will outright inform you never to sell a house ‘as is’; on the other hand, some house owners seem quite eager to offload an asset ‘as is.’ But what does selling a house ‘as is’ entail? Let’s find out.
What does it mean to ‘sell a house as is’?
To sell a home ‘as is’ means to sell the property in its present, lived-in condition and is being sold without any repairs or rehabilitation. Such properties are always listed for sale, ‘as is,’ by their owner or the agent representing the owner. In layman’s terms, the seller is unwilling or unable to bear the cost of the repairs. In such cases, the parties are usually agreeable to selling a property at a discounted price.
There are other instances where agents or property-owners have a legitimate reason for selling a house ‘as is’. Let’s say if a financial institution has possessed a home, or if the original property-owner has passed away and the ownership or onus has passed to their next kin or legal representative- all of these are legitimate instances, where most owners consider selling a home in a state of disrepair without restoring the same.
Additional Read: HOW TO SELL A DAMAGED HOUSE IN CHRISTCHURCH AS-IS?
Positives and negatives of ‘selling a house as is’?
The most significant advantage of buying a house ‘as is’ is its ‘cash value.’ An ‘as is’ home is always listed at a low rate. However, the understanding is that such a property can be flipped for an appreciated cash value once it has been repaired and restored. Most savvy buyers head for ‘as is’ deals with the notion that upon closer inspection, they may find faults that can be leveraged to get a further price reduction, and, in some cases, there are.
This brings us to the primary challenge with buying a house ‘as is’. It is essential to scrutinize such a property very closely because the buyer does not want faults to manifest later. Also, most ‘as is’ property sellers are interested in a quick, cash payment.
Is it worth investing in a house being sold ‘as is’?
The heavily discounted prices certainly make a good case for buying a house ‘as is’, but only upon proper inspection. A professional inspection after the initial deposit is made, is recommended. One can have contractual contingencies that allow them to walk away with the deposit if the inspector finds unlisted issues. Home inspections are worth the cost and are especially recommended for bank-owned properties. The cost of repairs and inspection, however, must never outweigh the cash value of the restored property.
In some instances, the seller might offer to cover some of the repairs to sweeten the deal, especially if the property has been sitting on the fence too long, despite a reasonably low price point.
