“as is”

Home Makeover of the Year 2013

Home Makeover of the Year 2013

I sell all kinds of houses, trophy homes, second homes, fixer-uppers and more, and all of them are special to me, I never forget them. Once in a while I have a very special listing, whether for its style, setting, charm, or fit/finish/detail work, and it’s great to see what the buyer does with it once it’s theirs.

Not too long  I had one of those, it was a small ranch house on a one-of-a-kind piece of property that had been in one family for it’s entire lifetime, almost 80 years. The house was located high on a ridge overlooking a large pond, surrounded on three sides by water, within a nice neighborhood but unusually secluded given all those things. And to top it off, it was located around 20 miles from downtown Boston.

The buyers had been looking for years for the right house to downsize to from their large, classic Colonial Saltbox home in Sudbury, and they just couldn’t find one. Then one day they came to my open house and fell in love with the setting.  The buyers were contractors in Sudbury with a specialty of building additions and expansions onto existing homes, so this was the perfect opportunity to do their thing.
after update

The home they made it into is absolutely beautiful, it fits the site perfectly and is in keeping with the scale and style of the neighborhood and it’s environs.  What they did was rotate the roof line by 90 degrees and build-on a second floor to the existing first floor walls. They then added a farmer’s porch on the front to create an inviting entrance that can be used for sitting in the evening and enjoying the views and the neighbors. Inside they kept the original kitchen cabinets and 80 year old porcelain sink, while updating the appliances and reconfiguring the first floor for today’s lifestyle.

As you can see, the front walk and lawn area are new, and a lot of the existing plantings have been retained. They will be augmented with more gardens over the years as they both have  a green thumb and I’m looking forward to watching it take shape over time.

A lot of discussion these days is about how houses have to be Pottery Barn perfect and completely updated to fit today’s discriminating buyers, and there is a lot of truth in that. But just once in a while, there is a home that needs work, and yet it’s the perfect home for one buyer. All it takes is a little vision.

What does “AS IS” mean in real estate?

What does “AS IS” mean in real estate?

The real estate industry has its own unique language that can sometimes be confusing. One term that comes up a lot, especially in these times of bank-owned properties, short sales, and foreclosures, is “as is” and its variations “where is”, and “in its present condition”. There are some agents who feel that part of the reason we see “as is” cropping up more and more is because more buyers are being coached to use the home inspection as a reason to reopen negotiations (sometimes justified, sometimes not) and that sellers and their agents, who may have already lowered the price several times, are using it as a tactic to close the door on this practice.

This is not a term to be used lightly by sellers, because there are costs as well as benefits, and if you don’t know what it really means, you shouldn’t use it. Sellers commonly mistake “as is” as a way to avoid making any repairs, rationalizing that a lower asking price will reflect the condition and eliminate expectations. Buyers, however, tend to interpret “as is” differently.  There are two common negative reactions that have serious consequences to a seller’s ability to sell: first, buyers sometimes take it as a sign of blood in the water and think that they can bargain way down from the asking price because they are now suspicious that many things are wrong with the house; and second, they will be very wary of “as is” houses and even avoid viewing them or putting in any offer for fear of hidden defects that will require a lot of time or money. You might be better off without using that clause and instead having your agent stress that at the agreed selling price the home inspection will probably not result in repairs or a price reduction on the part of the sellers.

“As is” is actually a legal term and concept used to disclaim liability for the condition of the house being sold. It says that the seller is selling and the buyer is buying the house in whatever condition it presently exists, and that the buyer is accepting the house “with all faults”, whether or not immediately apparent. It is most commonly (and correctly) used in estate situations, selling rental properties or when banks or relocation companies own the property … the sellers have never/not recently lived in the house and have no first-hand knowledge of any issues/defects. In Massachusetts, the seller and their agent must disclose any known defects in the property in an “as is” purchase, but they don’t have to disclose what they don’t know. Seller’s gents are generally very good at disclosing known defects, but buyers should know that agents are required by law to answer direct questions honestly and to the best of their knowledge, so when in doubt – ASK THE QUESTION.

And last, when buying any home the buyer must take the time to thoroughly examine the home before accepting it, but buying a home in “as is” status is the ultimate “buyer beware” situation. That means obtaining expert home inspection(s) and legal advice and doing what their experts recommend. It also means checking with your mortgage broker to make sure their institution will finance an “as is” purchase – many won’t.

In closing, buyers should clearly understand that their contract to purchase any “as is” home is contingent upon acceptable inspection(s) and that they can take the house or walk-away but the seller is under no obligation to re-negotiate or correct any inspection issues no matter how severe.

I have represented many sellers and buyers with “as is” homes and done right the transaction can work out amicably for both parties.

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