Listing a home “as-is” is a convenient way for property owners to sell the home in its current condition without making the repairs or upgrades typically requested by buyers. Though some prospective homeowners see “as-is” as a warning sign, others see it as an opportunity to make the home their own. This inspires the question: What does as-is home purchasing mean? If you see the term in a real estate listing, consider the following before making an offer.
Read on to learn more.
What “As-Is Home Purchasing Means
“As-is” is a common term in real estate that indicates no changes to the property will be made before the sale. Therefore, the buyer forgo the opportunity to ask the seller to make repairs or improvements on the home—and the ability to negotiate credits to fund these projects.
There are several reasons buyers in Arizona would make an as-is home purchase. Some homes sold as-is went through foreclosure and are under bank ownership, and others were inherited by parties who simply want to sell. Buyers will get peace of mind knowing the seller is still required to disclose known problems, and the home will have to undergo inspection before closing. The buyers’ legal rights do not change.
Alternatively, some property owners sell as-is because the homes are in disrepair, and the sellers cannot afford to make fixes before selling. This is one of the main downsides to as-is home purchasing.
Pros and Cons of an Arizona “As-Is” Home Purchase
Purchasing a home in a state of deterioration is no small risk. As many property owners know, home repairs are oftentimes costly endeavors, so fixing up an as-is home could be more expensive in the long run than buying a traditional listing. Think about the potential impact on your savings when you see a “good deal” on the market.
However, if you are looking to flip a property or can manage repairs on your own, the low price of an as-is home could be understandably enticing. Buyers who move forward with purchasing these properties are typically comforted by the results of the home inspection
Seller Best Practices
Sellers in this scenario should make it abundantly clear that the property is being sold as-is. Adding the phrase to the listing and many times throughout the description may seem like overkill, but it ultimately saves time because prospective buyers will know exactly what they’re getting. Beyond the listing, sellers must include “as-is” terminology to the contract, which will govern the transaction through closing.
Buyer Best Practices
Buyers looking into as-is homes should be fully aware of the risks involved with purchasing these types of properties. Due diligence is crucial, so buyers should consider involving an experienced real estate attorney to perform a title search and investigate the deed and land records. Additionally, termite inspections and structural inspections should be conducted in advance, with the option to back out of the transaction if the inspectors find anything concerning.
Find an Experienced Phoenix Real Estate Attorney
An Arizona as-is home purchase requires the experience and knowledge of a real estate attorney to make the best decisions possible in the transaction and any related contracts in the interim and the aftermath. The attorneys at M&G Law can help you structure the best way to purchase the as-is home, including helping with contracts for renovation afterwards. Contact us today at 602-726-2229 or make an appointment on our contact us page online.