Selling your Home as is
The internet is full of suggestions for making your house more attractive to buyers and getting a quick sale.
Improving the curb appeal of your home always pays off. For example, landscaping can increase the value of your home by around 5 to 20%.
The one thing all these tactics have in common is that they cost money.
What if you don’t have the time and finances to refurbish your house before selling it?
Selling your home as-is could be the answer. Here’s how it works.
What Is the Meaning of ‘As-Is?
Put bluntly, “as-is” means “what you see is what you get.” It’s not quite that simple, though.
To sell your house in its current state you need to expose all the gory details to prospective buyers.
Each state has its own requirements regarding the things you must disclose. These usually refer to aspects of health, safety and structural defects.
Unfortunately, this means that you’ll need to pay a registered home inspector to make a list of everything that’s wrong with the house.
It’s illegal to try and do this on your own. Some of these problems, especially structural issues, may be out of sight and need specialized detection skills.
The home inspector must include all their findings in an official disclosure document which the buyer signs.
This is a small inconvenience considering that you would have to do it anyway if you were selling your home the usual way.
Benefits of Selling Your Home As-Is
Despite this, selling as-is is still a good option for many homeowners.
There are four main benefits that come with this kind of sale.
1. A Quick Sale
Time is one of the biggest motivators for selling a home as-is.
Everybody wants to pay as little as possible for things. That’s why the more expensive a house is, the longer it stays on the market. Buyers hang in there hoping that the seller will become desperate and drop their price.
What’s more, the longer a house stays on the market, the more convinced prospective buyers are that the price will eventually come down.
There are many good reasons you may want to get rid of a home quickly.
You’re Moving On
If you have found a new property and you want to sell your house to make a down payment on the new one quickly.
When going through a divorce, a quick sale can help to wrap things up fast so you can move on with your life.
You don’t want your old love nest hanging around for too long reminding you of the good old days.
An Unwanted Inheritance
When you inherit a house and you aren’t going to occupy it, you may not want to deal with its upkeep.
Unless you’re prepared to handle the administration and maintenance involved with renting an inherited house, selling an inherited house fast is the best option.
You Need the Cash Quickly
Life happens. If you’re in a hole that needs a mountain of cash to climb out of, selling your home could be the only way to get the necessary funds.
Perhaps you can no longer afford to pay the mortgage and you want out of the deal as fast as possible.
You don’t have time to hang around for another month trying to sell your house. You don’t have money for the necessary repairs, either.
That brings us to the next most obvious reason for an as-is sale.
2. Avoid Costly Repairs
Most people who want a quick sale do not want to go to the effort of a lengthy renovation process to attract buyers.
There’s no guarantee that these modifications will work out to be cost-effective either. Spending money on improvements will increase the value of your home, but until you have an offer you won’t know how significantly.
Thus it’s impossible to predict how much to spend in order to get a specific return.
If you simply can’t afford costly renovations or even basic repairs, you should seriously consider selling the house as is.
3. No Real Estate Agents Commission
Real estate agents can be most useful in finding qualified and willing buyers. They will also take care of advertising your house and showing it to clients.
However, all this comes at a fee. Usually, a realtors commission is around 6% of the total sale price.
That can add up to a tidy sum of money out of your pocket. You rarely need a realtor when you’re selling as-is.
You can do your own advertising and you don’t need any particular skills when showing buyers the goods.
Honesty is the best policy for this kind of sale. Being transparent with prospective buyers can save you a lot of hassle down the line.
4. You Can Skip the Staging
Apart from ensuring that your home is clean and tidy when buyers come around, you don’t need to put on a show when they arrive.
They don’t expect your house to be perfect.
This saves you a lot of time, effort and anxiety trying to get it to look like something out of an interior design magazine.
Downfalls of an As-Is-Sale
There a few pitfalls when it comes to selling a house as is too. In many cases, it’s worth the risk.
These are the major negatives associated with this kind of sale.
It Creates a Negative Impression
When a prospective buyer sees a home advertised for sale “as-is,” it can put them off viewing the house at all.
Any prospective buyer is after a good deal. Showing a home that needs a little TLC opens the door for them to look for fault in an attempt to negotiate a cheaper price.
You Can Come Across as Desperate
Likewise, many buyers will assume that you’re desperate for a quick sale and attempt to low-ball you on the price. Be prepared for this by having a counter-offer on the tip of your tongue.
Keep your absolute minimum in mind. If you still have some time, you don’t have to bow down to the first deal you’re offered.
You can expect offers that are less than what you’re home is worth or far below what you want to get for it.
A Limited Market
Just like there are serious buyers who love fixer-uppers, there are more people who don’t.
Not everyone has the foresight to see the potential of a home that isn’t at it’s best. Even fewer people have patience, funds, or time to tackle ongoing renovations.
Many buyers will baulk when they consider the time it could take to get the house up to scratch.
Sometimes, a low purchase price can’t make up for the time, stress, and effort needed for repairs.
You May Have to Settle for Less
When you receive an offer on an as-is sale, and you’re out of time, you often have no option but to take it. Even if it’s for much less than you expected.
You’re not in a position to negotiate when the house clearly needs work, unfortunately. Especially if you’re after a quick sale.
If the buyer discovers major flaws in the property that you haven’t disclosed, they can sue you.
Any aspect of your property that isn’t included in the disclosure statement opens you up to litigation.
This applies even if you didn’t know about the problem when you sold the house.
There Is Another Way
The safest and best route for selling your house as is to offer it to an investor that buys houses in any condition for cash.
This has its own set of ups and downs.
Benefits of Selling to a Cash Investor
Investors that buy houses for cash will make an offer without the back and forth that goes with haggling.
They have the cash available to help speed up the sale. There is no delay while you wait for them to find finance for the deal.
These cash buyers will rarely request an appraisal or home inspection to seal the deal either, saving you time and money. In fact, some of them will even buy houses ‘sight unseen’.
Drawbacks of Cash Investors
The only negative is that investors have their own costs to consider and are likely to offer you a price on the low end of the scale.
If you have no emotional ties to the house and no other offers, this can be the quickest and easiest solution for you.
As long as you do your homework finding a reputable firm that buys houses for cash, selling a house this way is often a win-win situation.
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