I often run into home sellers who state up front they want to sell my house as-is.
There is a time and place to sell your home as-is, but for most home sellers I don’t believe that is their actual intention. Keep in mind there is a legal definition to as-is and a buyer’s perception of as-is and you don’t want to market your home as-is unless you need to.
I like this concise definition of As-Is, excerpted from The Enforcibility of an As-Is Clause from Robert E Williams. Cited by K. Woodmere Associates, L.P. v. Menk Corp., 720A. 2nd 386 (N.J. App. Div. 199800
“When used in connection with the sale of real property, ‘as is’ generally means the purchaser is acquiring real property in its present state or condition. The term implies real property is taken with whatever faults it may possess and that the grantor is released of any obligation to reimburse purchaser for losses or damages resulting from the condition of the property conveyed”
What Does It Mean to Sell My Home As-is?
As stated above, generally the term “As-is” means the home is being sold “as is”, meaning just as the house sits and as you view it. It implies that under no circumstances will you do any repairs to the home or is there any warranty on the home.
When you sell your house as-is, it does not mean:
- You don’t have to answer any questions honestly when asked. While Massachusetts is a Caveat Emptor State, meaning a seller is under no obligation to disclose any defects to the property (with a few exceptions, lead paint and if you are serviced by a septic system), legally you are bound to answer any questions honestly. State law strictly states you must answer any questions honestly that are asked of you.
- You can deceptively hide an issue. While legally you may not have to volunteer any negative information about your home, it is never alright to deceptively hide an issue.
Note, real estate agents are held to a higher standard in Massachusetts and must disclose any known material defects of the property. They will and should ask you to fill out a seller’s disclosure disclosing fact about your home. It is always best to fill it out and be transparent. Being upfront and transparent will always prevent the least amount of problems.
Now any good real estate attorney will put an “as-is” clause into a purchase and sale contract. It further protects the seller from any implied warranties or claims after the sale. While not completely necessary, it reinforces the fact that the buyer has had time to do their due diligence and they are accepting the property as-is at the closing.
Again, this does not protect the seller from any misrepresentation or fraud.
Sell My House As-is, The Buyers Perception
A buyers perception of a house being sold as-is will be much different than the typical seller who asks me to list their house as-is. A buyer will perceive a home being sold as-is as having multiple problems ranging from many minor issues to major issues.
What the buyer interprets sell my house as-is:
Selling Your House As-is = Serious Defect in The Buyers Mind
Real estate agents typically sell a property as-is for several reasons.
One, the house has serious issues, known or otherwise, and there are truly no funds to do any repair on the property. This is usually notifying the public the house has issues ranging from needing major TLC (tender loving care) to a full gut rehab.
Two, the other reason could be the home owner has other things going on in their life and can’t deal with the stress of selling. They just want to be done with it.
Third, a property sold as-is could be one that no one knows anything about, like an estate or foreclosure where the actual seller has no knowledge of its condition. Most likely they have never been or recently been house.
Lastly, you may also see a house listed as-is that is not about the condition of the property but about the title. There could be a cloud on the title that can make financing impossible and the agent is notifying the buying public you are taking the house as-is (with the problem) if you decide to move forward.
This is the typical perception of buyers when they see a house sold as-is.
Is that the message you really want to send to potential home buyers? Remember, selling your home as-is will still not prevent a buyer for asking for concessions after a home inspection anyways.
What Are Most Sellers Trying to Say When Tell Me Say Sell My House As-Is?
Often when a home sellers tells me they want to sell their house as-is, there house is in perfectly acceptable condition for the market place and they are hoping to get top dollar for their home. What they are trying to tell me is I am not doing
anything else to my home or any home repairs or renegotiating after a home inspection. Take it or leave it.
And that is certainly a home seller’s prerogative.
But to state the sale is as-is, upfront in the MLS, you are narrowing down the potential buyers for their home. Immediately you will get the bargain shoppers looking for the fixxer uppers which in many cases not the true buyer for your home.
Secondly, what if an actual problem shows up during a home inspection? Sometimes a home inspection will reveal a problem that a home seller did not know anything about.
A big deal killer in recent years is mold in the attic. Most home sellers are not even aware they have it but it is certainly can
be a huge deal killer. Are you going to kill a home sale over a few thousand dollars in mold remediation? An issue which a real estate agent will now have to disclose once they know.
A Better Option To Selling Your House As-is
A better option to selling your home as-is can be multi-faceted. It starts with keeping an open mind, preparing your home properly for the market and pricing it properly for the market and condition.
A home that is properly prepared for the real estate market and is priced accordingly will usually have a relatively smooth home inspection process. Buyers know when they have a good house at a fair price and are less willing to give up a home over a few minor home inspection issues.
If there are serious safety, structural or system issues that are revealed they may be issues you want to address if you truly want to sell home. Remember it is always your prerogative to say no to a home repair request. The final say is yours.
It is important to work with your agent and see if the repairs are truly something that should be done or not. When you are in a sellers market it is much easier to say no to a request than when it is a buyer’s market.
Don’t set a tone up front with buyer’s. Play it by ear and deal with each issue as they come up appropriately.
When Is It Appropriate To Sell Your House As-is?
I usually reserve the house sold as-is clause in the Multiple Listing Service for when a house has a serious condition or title issue which is not correctable by the home seller. It usually boils down to homes that typically cannot receive financing because of their condition. And that condition could mean title or physical condition or any other set of circumstances that would prevent financing. Or, it could be a situation where the home seller may have the money but won’t put it into the property.
Again, to state up front your house is being sold as-is just raises a red flag for buyers that you mostly likely do not want to raise. Only under certain circumstances do you want to call that out in your listing. The average home buyer will view it as a project they do not want to get involved with and the bottom feeders will come out thinking they can get a great deal on a home.
I understand what many home sellers are saying when they tell me I want to sell my house as-is. But that may not be the best way to market your home, especially if you are looking for top market value for your home.
What you are telling me is you are not going to be giving any concessions for repairs. The concession could be price reduction or doing the repair itself. And, that is handled in how you negotiate not by listing your house as-is. Set your home price at the right price and prepare your home accordingly. Barring unforeseen, major issues you shouldn’t have a problem.
- Kyle Hiscock- How To Sell A Home IN As-is Condition
- Teresa Cowart- Sell An Undesirable Home
- Paul Sian- What To Know About The Residential Real Estate Disclosure Form
- Bill Gassett- When In Doubt Disclose