All you need to know about “As-Is” Properties

Identifying the right property can be a grind for most property buyers. At such times, you may come across a couple of listings that mention the words “as-is” that may pique your interest. While some property advisors will say that such properties are not to be touched with a barge pole, others may say they have some merit. Confusing much? Let us clear it up for you. 

What does an as-is property mean? 

In most cases, As-is property implies the properties on resale. An as-in listing indicates that the seller will not address any issues that may cause problems for you (the buyer) post the sale. In other words, what you see is what you get. However, this does not mean the seller is exonerated of disclosing problems with the property before selling. 

Problems with as-is properties can be as follows: 

  1. Structural issues
  2. Damage to the walls or roof 
  3. Sanitation issues 
  4. Mould problems 
  5. Termite infestation  

The seller may disclose that he is selling the property in distress because of financial hardship or the urgent need to move to a different location, as a result of which he needs to sell the property immediately. Banks or other financial institutions may also list as-is properties for foreclosed homes. After repossessing such properties, the bank may want to offload the property and not waste time making minor repairs. 

What should a buyer do? 

As a buyer, it isn’t easy to decide whether or not you should opt for such properties. However, suppose the said property seems interesting for reasons like an attractive price point that may make it an investment with great potential for high returns.

 It may also be at a location that is premium and comes with a high demand. In such cases, do not rule out the possibility all at once. 

The best thing to do is to have a cautious approach. Get an inspection done from a trusted source and estimate the renovation costs. If the problems seem minor, you may just have struck gold. However, it may not be worth it if the scrutiny reveals major structural issues and expensive repairs. 

The former may be true of bank-listed properties. In such cases, you can also be sure that land deeds and other legal and technical documentation are in place because the bank has already disbursed a loan for the same property. 

In India, it is also likely to stumble upon distressed property sales, even if you may not be actively looking for one. In such cases, it is advisable to move with caution. It is essential to investigate the reason for the distress sale thoroughly. 

Checklist for buying as-is properties

Therefore, you should work closely with contractors who can accurately assess the property and a bank or financial institution for a pre-qualified loan. 

The most important thing about as-is or distressed properties is patience, as the purchase of such properties must be double-checked by parties with no vested interest to ensure all is clear. 

If you do not have the time, expertise or resources to ensure everything is in order, you may want to engage with a real estate agent who will operate on your behalf. 

In conclusion, it is fair to state – that an as-is or a distressed property does not always have a bad connotation. Proper inspection and estimation of such property at a suitable price and location may present a great deal and an opportunity to make it a forever home.   

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