If you have a house that’s in poor condition, you want to get it off your hands and you can’t afford to make repairs, you may be thinking about selling it “as is.” That may seem like the best option, but the process of finding a buyer and agreeing on a price can be difficult.
Understand What Selling a House ‘As Is’ Means
When a house is listed “as is,” that means it’s being offered in its current condition and the seller won’t make repairs as a condition of the sale. The term means that the buyer accepts the house in its current condition, with any problems and damage it may have.
Selling a house “as is” doesn’t mean that you can withhold information from a potential buyer. State laws on disclosure vary, but you may be legally required to reveal information about any known problems with the house. You may also be prohibited from intentionally concealing defects, for example, by painting over a wall with mold. If you withhold information or conceal a problem, you may face legal repercussions later.
Because of a strict code of professional ethics, your real estate agent may be held to a higher standard than you are. Even if you aren’t legally required to tell a buyer about a problem with your house, your agent may be obligated to share that information.
Expect to Receive Lowball Offers or No Offers at All
Buyers expect a house sold “as is” to have serious problems, and they may assume that your home is in worse condition than it really is. Many buyers avoid considering houses sold “as is.”
If you decide to list your home with that phrase attached to it, don’t expect to receive many offers. If you do get one or more bids, they may be for less than the asking price. Even if you and your agent worked hard to determine a fair list price, buyers and their agents may negotiate hard to get you to lower the price even further. Convincing a potential buyer that your asking price is reasonable may be an uphill battle.
If you only get one offer, that can give the buyer leverage in a negotiation. The buyer may assume that you’re desperate to sell the house and may insist on a significant price reduction. You may feel compelled to give in and accept less than your home is worth because you fear that another interested buyer won’t come along and you won’t get another chance to sell.
Ask Your Agent for Advice
If you’re in financial trouble, you can’t afford to make repairs and you just want to get the house off your hands, selling “as is” may be your best option. If, however, you can afford to put some money toward repairs, you may receive more offers and sell the house for more than you could get by listing it “as is.” Your real estate agent can discuss your circumstances and advise you.
