[M05/S06] As-Is Real Estate Sales

What’s an “As-Is” sale? As-Is real estate sales are dominant in California – this means that the seller intends to sell the home in its present condition, without fixing anything more that needs fixing.

In fact, the standard Realtor¨ California Residential Purchase Agreement contract is written such that the seller will not be obligated to make repairs or correct deficiencies – so whether the home is marketed “as is” or not, in practice, virtually all homes in California are sold on an “as-is” basis.

If anything is found by the buyer as in need of repair, the seller is typically under no obligation to do any repairs or credit the buyer for them in any way. Having said that, even though the purchase agreement states that the property will be sold as-is, remember that the buyer has their due diligence or inspection period. At the end of that period (which typically lasts about a couple of weeks), they can – and often will – try to re-negotiate the deal.

If they find out anything about the property they didn’t know when they made the offer, they’ll usually try to negotiate for a repair, a reduction in price, or some kind of credit. This can easily run into thousands of dollars. The good news is, the seller is under no obligation to do any repairs, offer any credits, or reduce the price – that’s the beauty of an as-is contract.

However, many sellers, when presented with the prospect of having the deal fall apart or conceding a few thousand dollars to the buyer, will often times make a concession to keep the deal going. These kind of shenanigans on the part of the buyer can be largely or entirely avoided by providing a complete disclosure package up-front. If a buyer is given a thorough and accurate representation of the property’s condition and all other material facts, the buyer will find no angle from which to re-negotiate any part of the deal.

Point. Click. Offer. Sell.