Under certain market conditions, we see the rise and fall of specific phrases that seem to creep into listing descriptions. Most frequently, we see the ominous "as-is". But if you understand what this means, you can move through listings with more ease.
What does As-Is mean for a Buyer?
When a Buyer encounters a home that is listed "as-is" condition, the Buyer is agreeing to accept the property in it's current form. This typically includes all of the defects that exist in the home, but this does not eliminate the option to perform a home inspection. A home inspection is your best deep-dive into the condition of a home and how it functions. Typically with an As-Is purchase, the inspection is for informational purposes only - but occasionally if a major structural, environmental or safety issue is found, the Seller and Buyer can negotiate repairs or credits.
What does As-Is mean for a Seller?
A Seller should make it very clear up front that the property is being sold in "as-is" condition because this will help to identify the right Buyer and not waste anyone's time. You are choosing to let the Buyer know that the property needs some TLC and that you will not be making repairs. These defects will need to be listed on the Seller's Disclosure. It is typical that the property is listed at a lower price to offset the repairs needed. Best practice would be to consider making the repairs ahead of listing your home to increase value. When a Buyer sees a property listed "as-is", they tend to have a preconceived notion that they can lowball.
As always, you should do your due diligence when engaging in a real estate purchase or sale. Even in hot markets, it is best to always provide transparency and clarity on what you know or need to know. With the right advocate in your corner, there are creative ways to navigate this and still maximize your investment.
Do you have questions about buying or selling a home in as-is condition, or exploring your options for a rehab using the equity in your home? You can contact me at (972) 978-3109 or dfwAshley@gmail.com to discuss at length.