Sellers are sometimes encouraged to have a professional home inspection conducted before they list their house, so they can take care of any repairs before taking the chance that defects show up later that delay or even cancel a buyer’s offer. Some sellers, however, will forego the inspection process and list a property “as is”. Why would a seller list their property “as is”, and why would a buyer accept a house described as such?
A seller might not have the time, nor be in the financial position to make even the smallest repairs to a property before they move, or, especially if they are elderly, they may not be capable of dealing with renovations or repairs. They may be in a hurry to move on, and as such will sell for less in order to compensate for any possible future costs to the buyer.
Sellers who have inherited a property might list it “as is”, as they simply aren’t familiar with the property and don’t know of any current defects. Lenders who foreclose on a property and rental property investors are also known to list homes “as is”, since they haven’t actually been living in the home to know if there is anything wrong. These are often the properties that have great potential to be picked up at a bargain.
While a house listed for sale “as is” should certainly be approached with caution, it also doesn’t automatically mean there is something seriously wrong with it. A buyer may be willing to take a chance on a property for the sake of a lower sale price, or easier financing. “Caveat emptor” — or, “let the buyer beware” — should always be observed; however, as even if a seller is obligated to inform the buyer of any known defects in the property, he may honestly not know of or anticipate any problems. The “as is” designation means that the buyer cannot renege on an offer because of defects, if any show up later.
Let’s discuss the process of a home inspection, and it it’s something you should consider if your real estate plans.