Selling a house in bad condition? Consider selling your house as is

Fill out this form to get a fast, as-is, cash offer for your home

  • Selling as is doesn’t mean the buyer cannot do inspections
  • When selling as is, you should still disclose any problems or defects with the home
  • Selling your home as is, typically means selling for less than if your home was fixed up

If you own a house out of town or one that needs repairs, you may be asking if you can sell a house as is.   It might be a home you inherited, a rental property or maybe you just need to move and don’t have the time or the money to make needed repairs on your home.  Maybe you are simply wondering what as is really means?

Selling as is can make it easier for you to sell your home quickly and avoid the hassle of expensive repairs, but it does have some drawbacks.

What does it mean to sell house as is?

As is has different meaning for different people.  Most sellers think that selling a home as is means they’re not going to make any repairs.  Not only can this save you money, time and effort, but you can sell your home in it’s current condition.  Selling as is may save you from having to paint, replace carpet, fix roofs or plumbing issues.

If you have inherited the home, chances are you have very little idea what may be wrong with the house.  You probably don’t know what repairs it actually needs.  Selling as is frees you from the worry of problems potential buyers may ask you to repair.  It can also let you receive the money from your inheritance sooner, instead of consuming your time and money on repairs.

What as is does not mean

No inspections

Some homeowners may think that selling a home as-is means there will be no buyer inspections.  Buyers should always be allowed to do as much and many inspections as they desire.  It’s in the seller’s best interest that their buyer be fully aware of what they are buying.  Some sellers may want to hide potential major repairs, but doing so could open the seller up to lawsuits.  Encourage and allow your as is buyer plenty of time to make reasonable inspections.

No contingencies

In a traditional sale, the most common contingencies are the ability of the buyer to obtain financing or possibly to sell their existing home first.  With a cash, as is buyer, this is usually not the case.  Since cash buyers are often investors, their contingencies, if any are more likely to be about hidden repairs.

Most real estate purchase agreements will have a contingency statement allowing the buyer to cancel a contract should their inspections reveal problems that were not readily apparent.  In California, the standard purchase agreement used by Realtors® allows a buyer to cancel the contract up to seventeen days after the contract is signed.  The amount of time and reasons for cancellation can all be negotiated up front before the contract is signed.

Selling site unseen

Occasionally you may hear of someone bragging of buying a house “sight unseen”.  While this does happen, it is not normal and is ill advised.  I’ve bought houses that I have not seen, but only because I had sent a trusted friend by the house beforehand to do a brief inspection.  People who buy houses sight unseen often end up buying an empty lot or a burned out house.  They may use Google Maps as their sole due diligence.

A professional cash buyer may make you an offer sight unseen, but they’ll complete their inspections and due diligence after you agree to their offer.

Re negotiating price

After a buyer performs their inspections, they may come back to you and ask for a price reduction.  While this is fair if their inspections reveal significant repairs that were not readily apparent when they did their initial walk through, this can lead to conflict between the seller and the buyer.  The seller may have thought that as is meant, “no matter what the repair costs”.  To the buyer, it means they’ll make all of the repairs, but they will need to account for those repairs in their purchase price.

No Disclosures

California is a full disclosure state that requires sellers of single family homes to disclose to potential buyers anything that may be considered to negatively affect value.  Even in other states, it is wise for a seller to disclose everything they know about the property before the close of escrow.

We’ll speak to disclosures in more detail in a little bit.

Beware of bait and switch buyers

Some buyers may use a bait and switch technique to lure you into contract.  They’ll offer a significantly higher price than other offers with the hopes of getting you to sign their contract.  Then, they use their inspection reports to re negotiate price, and tie the sale of your home up for months. Finally, in frustration and to just be done with the house, the sellers agree to the price reduction.

These buyers create frustration and a sense of distrust with their sellers.  Sadly, I usually hear about this after the sale of home and the final sale amount is for less than what other buyers would have paid, without the hassle.

Can I sell my house as is?

The answer is absolutely yes.  As already mentioned, selling your house as is has several benefits.

  • Sell your home in its present condition
  • Potentially save thousands in expensive repairs
  • Avoid drawn out buyer/seller negotiations
  • Avoid the stress of continued bills and property taxes while managing the repair process
  • Sell your home faster.  Fixing and reselling home can take 5 to 6 months from beginning to end.

However, as with everything, there are drawbacks.  Typically, selling a home as is means selling your home for less than if the home was fixed up.  In a seller’s market, this difference will be less than in a buyer’s market where the buyer may want a bigger discount for condition of the home.  If you’re in a buyer’s market, most buyers will expect to purchase the home for a discount equal to or greater than the cost of the repairs.  In a seller’s market, the buyer may be willing to accept a discount of less than the estimated cost of repairs.

How much does it cost to sell house as is?

Depending upon the amount of repairs involved, you can expect to sell your home as is for about 70% to 80% compared to similar homes that have been fixed up and repaired.  Most as is buyers will be cash investors.  If the cash buyer is just bird dogging for a larger investor group who buys “ugly houses“, you can expect to sell your home for about 60% of what the home will sell for after repairs.  You’ll obviously receive more money by selling to a local buyer, rather than selling to someone who will just sell or assigns your contract to another buyer for a fee.

Related reading:  What will it cost to sell my house?

How to sell your house as is, step by step

There are several things you can do to sell a house as is and make sure you’re not taken advantage of.

1. Get a home inspection

A home inspection will give you an idea of what repairs are needed for the home.  With the home inspection, also get a pest inspection.  These two reports should run between $400 and $600 total.  Once you have these reports, you can decide if you want to pay to have the items corrected and sell the house for more money or sell the home as is.  You can also provide the home inspection to potential buyers so they can make a realistic offer.

2.  Get estimates for repairs

If you are still considering making the repairs, then your next step is to get estimates for the most needed repairs.  Using your home inspection report, make a list of the critical health and safety issues.  Next, get bids from licensed contractors to complete the repairs.  If you choose to sell the property without making the repairs, you will have written estimates you can give potential buyers.

3.  Price the home appropriately

One of the big mistakes sellers make trying to sell a fixer up is pricing the home incorrectly.  Price it too low, and you can lose money.  Price it too high and you can also lose money paying the mortgage, insurance, and taxes while you wait for the property to sell.  If you want to get a fair estimate of value, you can pay for an appraiser.  For around $450 an appraiser can give you the value of the home based on it’s current condition.

4.  Be willing to negotiate

Your appraised value is just an estimate.  Some buyers may be willing to pay more, but others pay less.  Be willing and ready to negotiate.  Remember, you’re probably going to have to continue paying a mortgage, insurance and property taxes while you wait for your house to sell.  Selling quickly at a slightly reduced price may net you more than if you were firm and continued paying these expenses.

5.  Decide if you want to sell to an investor or through a Realtor®

Now, that you have written estimates from contractors for repairs and have an estimate of it’s current value, you’re ready to sell your home as is.  You can sell your home through a Realtor® and pay real estate commissions, or you can sell your home to an investor.  When selling a home as is, with a lot of repairs, you’ll often receive the same amount of money or more, by selling to an investor as selling through a Realtor®.    The reason, even when selling through a Realtor®, your most likely buyers will still be investors.  Investors are likely to offer you the same price whether you’re selling through a Realtor® or not,  because they’re looking at what the repairs will cost them.  By selling to an investor who buys houses for cash directly, you could save time and paying real estate commissions.

Does as is eliminate disclosures?

Many sellers think that selling something as is means that they don’t have to disclose known problems.  In real estate, selling a home as is has specific meaning, referring to obvious or visible defects.  It does not mean you don’t have to tell potential buyers about problems you are aware of.  When selling a home as is, you still must disclose anything you know to be wrong with the home.   Sellers have an obligation to avoid making misrepresentations about known defects or failing to answer questions truthfully.

Examples of things that must be disclosed if known

  • Mold
  • Asbestos
  • Leaking Roof
  • Pest infestations or damage such as termites
  • Major foundation problems or other structural defects
  • Major plumbing or electrical issues
  • Local neighborhood noise or nuisance problems

In California, if the property is held in a trust, the trustee is not legally required to complete a Transfer Disclosure Statement (TDS).  However, it may be wise to disclose all known issues in writing anyway for your own protection.

“A seller who wishes to ‘as is’ should make a full disclosure of all defects known… and state that additional defects, which the seller is unaware of, may be found.  A seller who is not familiar with the property for any reason (such as occupancy by tenants) should disclose this fact.  Doing so puts the purchaser on notice that he or she cannot rely on the very limited knowledge of the seller.” California Real Estate Law, Fifth Edition, Pivar and Bruss

When selling as is, the buyer should have the opportunity to do their own due diligence and inspections.   If your buyer asks for an inspection period, you can negotiate a shorter inspection period for them to complete their due diligence.

Should I sell my house as is or fix it myself?

The answer to this question depends on several factors.

Do you have the time to wait for repairs to be completed before selling?

If you have the time to wait for repairs to be completed before selling, then this may be a better option for you.  Keep in mind that most renovation projects take two to three months.  It typically takes us three to six months to after acquisition to rehab, stage and sell a home.

Do you have the money to make the needed repairs?

Don’t be overly optimistic about what’s involved in a completing your repairs.  Remember to get a full home inspection and cost estimates before you decide to fix it yourself.  Once you have the estimated repair costs, add some reserves for unexpected repairs.  Every repair project has things that come up that were not accounted for.  You may find dry rot you weren’t aware of or an electrical issue that needs to be corrected.  As a matter of habit, we add eight to ten percent to every project for contingencies.

Do you live nearby?

If you live just a few minutes from the house you are considering fixing yourself, this is not a big deal.  However, if your project is thirty minutes or more away, be sure to account for the amount of time you will be spending traveling back and forth while the project is being completed.  Even if you’re hiring a general contractor to complete most of the work, you’ll still need to periodically check in on the project.

Are you able to complete the repairs yourself?

If you are good at handyman repairs, you may be able to complete the majority of repairs yourself.  Landscaping and painting are items that most DIYers are can easily handle.  Replacing or fixing leaky faucets, broken light fixtures or minor dry rot issues can all be done relatively easily.  Major items like roofs, gutters and electrical, are better left to the professionals.

For a list of commonly missed repair items, check out our previous post Top Ten Most Forgotten Home Repairs.

Do you have the emotional energy for this project?

Lastly, and probably most most important, do you have the emotional energy for the project?  All of the items listed above consume our emotional energy.  Whether it be the time it takes to drive out to the project again, to have the contractor tell us they’ve found another issue, or just the waiting for a contractor to be available to to the project, all of these consume your emotional energy.

Before deciding to complete the repairs yourself or to sell as is, evaluate how deep your emotional energy well is.

Who buys houses poor condition?

The most common as is buyers are investors.  These cash buyers do not rely on banks that may require rigorous home inspections in order to purchase your home.  Furthermore, experienced cash buyers often buy homes as is.  They can quickly assess needed repairs and perform any inspections.

As mentioned above, many cash buyers are just middlemen.  These middlemen, called bird dogs or wholesales, advertise to buy your house for cash, and then sell your contract to a larger investor group for a fee. If selling your home as is, you will typically get a higher price if you sell to a local investor or cash buyer and avoid the middleman discount.  You should always ask potential buyers if they are buying the home for themselves, or for another buyer.


If your home has unfinished projects, or deferred maintenance, selling as is may be an option, especially if you don’t have the time or money to make repairs.  If you would like a cash offer for selling your home as is, complete the form below.