"As is" doesn’t always mean trouble
As you’re browsing your newspaper’s real estate listings, don’t be surprised if you run into the words "as is" more than once.
"As is," of course, means that a seller is unwilling to make any improvements to a house before selling it. And there was a time when those two words automatically signaled danger for a seller: "As is" often meant that a roof needed to be replaced, a foundation was cracking or that the basement flooded, and that the seller didn’t want to bother with those time-consuming and costly repairs.
That, though, has changed. Today "as is" may mean that a seller simply doesn’t want to nitpick over little repairs, like that broken shutter or that squeaky front door. Sellers are more comfortable putting "as is" into their home’s listing because they know it no longer carries the same stigma it once did, and it won’t chase potential buyers away.
The lesson, then, is simple: Buyers shouldn’t automatically shy away from a house being sold "as is." The home may turn out to be perfect save for a few minor repairs.
Today’s hot real estate market is one reason for the increase in "as is" homes. As the local real estate market continues to sizzle, and buyers are competing for the area’s top homes, more sellers are inserting the words "as is" in their home listings confident that those two little words won’t chase away most buyers. At the same time, buyers, who are still struggling through a seller’s market, are more willing to buy homes in "as is" condition. And as long as these buyers include a contingency clause in the sales contract calling for a home inspection before the sale is complete, there is usually little problem.
Selling or buying a home in "as is" condition, then, needn’t be a gamble. Consumers just need to take some simple steps to make sure they’re not burned.
The biggest protection buyers have when considering an "as is" house is the home inspection. A professional home inspector can uncover serious defects – a roof that needs replacing, a sinking foundation, a basement that leaks – that might cause a buyer to reconsider a purchase.
The smart move, then, is for a buyer to include a contingency in the sales contract stating that a sale can be broken if a home inspection uncovers serious defects. Home inspectors recommend that buyers pass on a house, even if it seems like their dream home, if a seller won’t agree to such a clause.
But what about sellers? Does placing those words "as is" in a home’s market listing slow a home’s sales? Does it cause buyers to pause, wondering what’s wrong with a home?
Not really, say real estate pros.
Traditionally, sellers, to get the highest value for their homes, would spruce up certain areas of a residence to generate the highest possible sales price. An owner, for example, might replace dark kitchen cabinets with light ones. They might install bright new carpeting throughout a home’s first floor.
But in today’s seller’s market, such moves often make little financial sense. If the home is priced right and sits in a good location, the odds are good it’ll sell quickly, even with those dark kitchen cabinets.
