If you are wondering what are the risks of buying a home as-is, chances are excellent you've seen one such listing. From the pictures and listing description, there doesn't seem to be any problems with the house. It looks well-maintained, boasts an updated kitchen, plenty of attractive features, and offers a quick work commute. Although it's said a picture is worth a thousand words, sometimes, what you see isn't what you get. The simple truth is there are inherent risks of purchasing a home as-is.
What are the Risks of Buying a Home As-Is?
Sellers lists their homes as-is for a number of reasons. Some are just looking for a quick sale and are confident of the home's overall condition. Others object to putting money into a property they will not own for much longer. But others, as you can imagine, do so because they are aware of certain issues but don't want the responsibility. Still others choose to list as-is in an attempt to conceal one or more problems.
"As is" clauses in sale contracts mean that sellers aren't making guarantees as to a property's condition, and aren't going to make any repairs. That's a buzz-kill to many buyers, who assume, rightly or wrongly, that something major is wrong with the house. But the problem can lie with sellers' finances, instead. Folks who are living on a fixed income—perhaps the situation with the sellers of the house you want to buy—or going through a job loss or divorce may not have the cash to make any fixes. So before you make an offer, find out as much as you can both from your agent and the listing agent as to why the house is being sold "as is." --Wall Street Journal
These sellers are relying on potential buyers to forego a home inspection. Unfortunately, that's a common buyer misconception -- that a home listed as-is or even a new construction house -- prohibits or does not need an inspection. The truth is, you as a buyer are entitled to a home inspection to uncover material defects. If you are looking at this type of listing, it's best to know the risks of buying a home as-is:
- All repairs are your sole responsibility. The whole point of selling a house as-is is to allow the seller to market the property with little to no preconditions. If you do purchase a home as-is, you'll have to pay for all the repairs. While this seems all-too-obvious, buyers often underestimate costs and any savings are wiped-out.
- The repairs and upgrades may not payoff. Even if you do estimate the costs correctly, there's still another thing to consider -- said costs might not return anything on investment. In other words, the seller already crunched the numbers and came to the inescapable conclusion it wouldn't be worthwhile.
- You can't change the neighborhood. Another factor to consider when looking at an as-is property for sale is the neighborhood itself. Sure, the repairs and/or upgrades will certainly improve the home, but will it price it out of the neighborhood? Or, is the neighborhood on the decline?
- Homes listed as-is in good condition are suspect. The reason alarm bells go off in your head when you encounter an as-is listing is for good reason -- your suspicions are raised. Even a home that appears to be in good condition could well be hiding serious issues.
- You won't have much (if any) redress. Of course, the biggest problem with purchasing a home in as-is condition is the fact that you'll have very little to absolutely no redress. This alone is sufficient reason to be (at the very least) highly skeptical.
If you are considering buying a home nearby the Eagle’s Nest Golf Club, West Charles Boulevard, West Indian School Road, or elsewhere in the Palm Valley community or Goodyear, give us a call. We’ll help you find the right home for you!