2 reasons NOT to sell your home “as-is” and what to do if you must

Bobby Fenner, Lic. in VA
Bobby Fenner, Lic. in VA
Published on November 1, 2016

We can think of several reasons why a homeowner would consider selling a home with problems, marketed in “as-is” condition. The most obvious, of course, is that there’s no money to perform the required work. This frequently happens in probate sales where the heirs inherit a home in need of work but lack the funds to put the home in market condition. As well, folks who need to relocate quickly for a job often just want the house off their hands so they can move on with their lives. Therefore, please get a FREE Home Valuation Analysis before putting your property on the market.

Although we understand why someone may need to sell a home as-is, we believe our clients need to know the possible ramifications of doing so. Let’s take a look at two reasons you might want to reconsider your decision to sell your home “as-is,” and what to do if you absolutely must.

1.You’ll have fewer qualified buyers if you sell as-is

When your home is advertised as a fixer, which is what most as-is listings are, you’ll partially drain the pool of buyers who can buy your home. For instance, since FHA-backed mortgages require that certain repairs be made before they’ll ok a loan, your buyer pool won’t contain many first-time buyers.

Then, those who are getting a conventional loan may be getting out of the pool as well since many conventional lenders balk at lending money for a home that needs significant work. Many conventional lenders will insist that certain items, such as a roof in need of replacement, be taken care of.

Then, there’s the fact that most buyers just don’t have the money to repair a home after moving in. Although your low price will attract the tight-budget buyer, the reality of the financial outlays after closing may prevent them from proceeding with a purchase.

Your buyer pool now contains mainly cash buyers and most cash buyers are investors – the most real estate savvy homebuyers. They’re out for a bargain and if you hope to sell your home at all, you may end up taking an offer for far less money than you’d imagined.

2.You won’t make as much as you hope

Today’s homebuyers say they want a home that they can move right into, stick their toothbrush in the holder in the bathroom and enjoy their new digs. So, why would a buyer want your home? When you consider this question, there can be only one answer: A buyer would want your as-is home because it’s cheap.

Depending on the extent of needed repairs, you will have to list your home for less than nearby homes that are in better condition. As mentioned earlier, a low listing price will bring out investors and everyone else looking for a bargain. Be prepared to get beat up over your price, regardless of how low it is, and to sell it for less than you’d hoped.

It’s quite possible that it may be more cost-effective in the long run to make the necessary repairs so that you can list at a higher price. This is something you should speak with your accountant about.

If you must sell as-is

We understand that certain home repairs may be financially out of the question for some sellers and they simply must sell the home in its current condition. Here are 3 tips to help:

Dress Your Home For Success    

Appearance matters more in real estate than most other industries.That old saying that you only have one chance to make a First Impression could never be more accurate than when someone makes that first visit to preview your home. With attention to increasing the home’s curb appeal and some fresh paint along with a good scrubbing inside will make even the worst home will look better. Preview Our Home Selling System as well as taking a few minutes to watch this video.

Most buyers will decide whether or not to view your home while shopping online, so paying attention to cosmetics makes for compelling listing photos. Sure, they’ll know that there is something wrong with the home (“as-is” advertises that), but if it looks ok, the perception will be that whatever is wrong with it can’t be that bad. Getting more people to view the home in person is the name of the game when it comes to selling quickly and for more money.

Consider a pre-sale home inspection

Sure, you have a good idea of what’s wrong with the home, but there may be more, or less, than you imagine. A pre-sale home inspection will give you the definitive answers you need and will go a long way in showing potential buyers that you’re earnest in your desire to be completely honest about the home’s condition.

Plus, if you supply the buyer with the inspection results before accepting the offer, you’ll be able to weed out those that will eventually back out, after they have their own home inspection.

Disclose everything

Protect yourself by disclosing all known issues concerning the home and the neighborhood. Yes, it feels as if you’re betraying yourself, but disclosure is important if you want to avoid running afoul of the law and winding up in court. Disclose Every. Last. Thing.

Life happens. People leave home, get married, get divorced, have babies, adopt, downsize, retire, and move across the county. There’s a home for every stage of your life. As Your Real Estate Agents, we are here to help you along the way. Call, text or email [email protected].

When You Use US as Your Agents, You Could Qualify For a FREE Home Warranty or FREE Appraisal

2 reasons NOT to sell your home “as-is” and what to do if you must
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