Selling a house as is: A comprehensive guide
Selling as is makes the buyer responsible for repairs and improvements, but you still might need to disclose certain defects.
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Daria Uhlig is a contributor to Credible who covers mortgage and real estate. Her work has appeared in publications like The Motley Fool, USA Today, MSN Money, CNBC, and Yahoo! Finance.
Updated August 23, 2024, 2:57 PM EDT
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Continued high demand and low inventory pushed home prices to a record high of $426,000 in June, according to the National Association of Realtors. Clearly, sellers still have the upper hand.
One way you can use that to your advantage is to list your home for sale as is. Granted, you might have to compromise on some other aspects of the sale. But you’ll be able to list the home sooner and with less upfront cost — and stress.
What does selling a house as is mean?
Selling a house as is means selling it in its current condition — or the condition it’s in when the seller and buyer sign the sales agreement. The buyer knows upfront that they won’t be able to negotiate for updates, renovations, or repairs, or a listing price discount to cover the cost of that work.
As-is home sales put sellers at an advantage in that they’re off the hook if a defect comes to light after the sale closes. They’re also not responsible if a previously disclosed defect turns out to be more costly to repair than the buyer anticipated.
What are the pros and cons of selling a house as is?
Selling as is benefits the seller in important ways, but it’s not without tradeoffs. You may land a cash buyer if you sell as is — in June, 28% of buyers purchased their homes with cash, according to the National Association of REALTORS. While a cash sale might be quicker, you might have to list it for a lower price. Here are some benefits and drawbacks to weigh:
Pros
- Getting your house sale-ready is easier and less expensive.
- A lower price might also attract cash buyers, meaning a faster close and no waiting for financing.
- You can protect yourself if you make the required disclosures; the buyer assumes responsibility for problems that arise.
- Making repairs and renovations before listing can be time-consuming.
Cons
- If you don’t have a lot of equity in your home, you’ll have to pay off your mortgage in full on closing day.
- You might exclude buyers who are getting a mortgage and have to meet their lenders’ requirements for the condition of the home.
- The money you save on repairs isn’t necessarily cash in your pocket; you’ll likely have to list your home for less than you could if the home was in top shape.
- Listing your home as is can also make for a more difficult sale. According to a survey from RE/MAX released in January, just 56% of homebuyers would consider buying a fixer-upper.
How to prepare your house for an as-is sale
The process of selling a home as is isn’t much different than selling a turnkey home. Taking some easy, inexpensive steps to present your house at its best can go a long way toward attracting a broader range of buyers and a higher sale price:
- Improve curb appeal: A well-maintained, clutter-free yard and clean siding, patios and porches can lessen buyers’ fears about the condition of the home.
- Do a deep clean: A top-to-bottom decluttering and thorough clean, including walls and carpets, shows buyers that you’ve maintained the home. Take the cleaning a step further by bleaching or repairing discolored grout and caulking.
- Gather documentation: Building permits, vendor receipts, and appliance warranties say a lot about your home’s condition and how you’ve cared for it over the years.
How to price your house when selling as is
The best way to set an as-is price for your house is to work with a real estate agent who has experience in your market. They’ll provide prices of recently sold, comparable properties and suggest the likely sale price of your home based on those comparables.
The agent can also tell you what the sale-to-list ratio is in your market. The ratio compares the listing price to the sale price. A 97% ratio means that homes are selling for 97% of their list prices. A 105% ratio means homes are selling for 5% above list prices. This ratio can help to confirm the accuracy of a given listing price.
What legal aspects should you consider when selling as is?
Disclosure requirements are the most important legal aspects of selling as is. For example, Pennsylvania requires sellers to disclose in writing any known material defects that would have a “significant adverse impact” on the property’s value or cause an unreasonable safety risk to people who enter the property. An as-is sale does not relinquish the seller from their disclosure requirements.
In Maryland, on the other hand, sellers can opt out of making a full written disclosure by providing a disclaimer statement instead. The disclaimer lets buyers know that the sale is as is, and the seller is not responsible for potential defects.
If your agent is aware of defects that must be disclosed, they also have a legal and ethical obligation to disclose them to the buyer or buyer’s agent.
Keep in mind:
Even in a state where full disclosure requirements can be waived in favor of a disclaimer statement, the seller still may still need to disclose known latent defects that wouldn’t be readily apparent to the buyer.
How to market your as-is house to attract buyers
Marketing an as-is home comes down to a few basic techniques:
- Realistic pricing
- Positive and honest presentation, using professional photos and marketing copy
- Optimum marketing exposure to the buyers most likely to purchase the home
- Easy access for qualified prospective buyers who want to tour or inspect the home
Most sellers use a listing agent, who’ll market the property on the multiple listing service, where every member agent will see it and can find buyers for it. Your agent will also tap into their network of buyers, including investors.
Tip:
Consider completing a pre-listing appraisal and inspection. Making the reports available to prospective buyers gives them detailed information about the condition of the home and lets them know upfront what the home is worth in its current state.
Selling a house as is FAQ
Can I sell my house as is without an inspection?
Yes. The home inspection in an as-is sale, like in any sale, is typically optional. The buyer can have one if they want, at their own expense. If you weren’t selling as is, a home inspection might identify some areas of the home that need work, and the buyer might ask you to make repairs or adjust the price accordingly. When you sell as is, you acknowledge that you’re selling the house in its current condition — and have disclosed any defects you’re aware of — but typically aren’t going to make repairs.
Will I get a lower price if I sell my house as is?
Most likely. Buyers interested in as-is homes typically see them as a way to save money on their purchase.
What are the risks of selling a house as is?
As the seller, you may have to settle for a lower asking price if you sell as is. Failing to make required disclosures about defects is another danger. Remember that an as-is sale doesn’t exempt you from disclosure laws.
How can I find cash buyers for my as-is house?
Your real estate agent is an excellent resource. You also might find cash buyers for as-is homes at local real estate investment groups and through your personal network.
What disclosures are required when selling a house as is?
Property disclosure laws vary by state. For example, the federal government doesn’t require you to notify buyers if there is asbestos in the home, but many cities and states do. Read your state laws or ask your real estate agent to explain the requirements.