Buying "As-Is" Properties

In a market with a healthy inventory, there are many homes on the market being sold "as-is". Buyers often are averse to viewing or purchasing an "as-is" property, fearing something drastically wrong with the house that the Seller is trying to conceal. However, Buyers should not discount "as-is" homes for this reason - they are often great purchases with very minor work needed.

Traditionally, a home seller might be responsible for a certain percentage of the repairs needed to the home as determined by a licensed inspector. Sellers are more and more selling the home "as-is" to avert the possibility of unexpectedly paying for repairs out of pocket - but often will ask a lower price in return. Common misconceptions include the fear that the "as-is" home is a handyman special, in need of massive repair. This is rarely true - in reality, Sellers sell homes "as-is" for a variety of reasons, and may not be aware of any issue with the home.

Buyers are also protected in several ways. In Florida, Sellers fill out Sellers Property Disclosure forms which are readily available to prospective Buyers. In this form, the Seller is bound to disclose any material problem he knows about - prior roof leaks, proposed land use changes, or a broken security system, for instance. In a variety of categories that range from interior to exterior, heating/cooling, age of appliances, and neighborhood issues, Sellers relate their knowledge to prospects so that they might make an informed decision.

Buyers should always invoke their right to an inspection of any property they purchase. The inspection period is generally 10 days to 2 weeks, and gives Buyers the opportunity to conduct any inspections they wish, most commonly being a general home inspection and a pest control inspection.

As a Buyer's Agent, I recommend writing a contract "As-Is with Right To Inspect". When making an offer, Buyers can indicate a dollar figure they are willing to absorb in repairs - if a licensed inspector determines that the repairs needed exceed that amount, the Buyer has the right to cancel the contract and get his deposit back. This process allows the Seller to refrain from being responsible for any repairs, but also affords the Buyer protection that they are not locked into a contract if a serious issue is found.

It is important to note that a Seller is never responsible for aesthetic improvements - a new paint job, for instance. Conversely, a Buyer cannot use expected aesthetic costs as a basis for "needed repairs". But the Buyer will be protected from major issues with the home not readily noticeable to the untrained eye.

For more information on working with a Buyer's Agent who can walk you through an "as-is" purchase, visit www.TrueSarasota.com.