What Buying “As Is” Really Means
If you’re looking to buy real estate in South Carolina, congratulations! The Palmetto State has some of the most beautiful homes and properties available anywhere in the United States, and there is nothing like living the Low Country lifestyle. But the excitement of buying a home can be overshadowed by confusion over the many avenues to making a real estate purchase.
Perhaps one of the most confusing is buying real estate in South Carolina “As-Is.” Let’s explore this option more thoroughly to see if it could work for you.
Buying Real Estate in South Carolina “As-Is”
A home for sale listed as an “As-Is” property simply means the sellers do not want to invest any time or money into making repairs to the home before closing. That means that, as a buyer, you must agree to purchase the property “As-Is” — in its present condition. What you see (or can’t see) is what you get.
Of course, “As-Is” sellers must meet minimum disclosure requirements that are required by South Carolina law; more about that later. But in a general sense, you agree to buy the home without any changes whatsoever.
Now, while this may sound like buying “a pig in a poke,” as the old southern saying goes, there can be lots of reasons for this type of sale. Not every “As-Is” home listing is damaged or aged beyond repair. Sellers can choose this option for any number of reasons, including:
- No money available to pay for repairs
- Save money on making repairs
- Need to sell fast because of a pending move
- Wanting a cash offer to avoid lengthy mortgage process, so property is listed lower
Why Should I Buy Real Estate in South Carolina “As-Is?”
Some home buyers may find that purchasing an existing home “As-Is” is a good option. The wise home buyer can realize some significant benefits.
Lower Purchase Cost
In many cases, the seller’s desire to list “As-Is” for whatever reason means you get a prime property at a much lower price than is the norm. Depending on what the home needs, you could purchase it substantially below the average price. Not only does this save you money, it can make for lower interest rates and mortgage payments. It could also allow you to borrow up to the full value amount of the home and use the extra money for repairs, renovations, or other needs.
Ideal for Property Flipping
Experienced contractors or house flippers that subcontract renovations can find “As-Is” real estate in South Carolina to be profitable projects. Ideal properties purchased with few serious problems are quite affordable to repair and flip for quick investment and return. Some that are priced low to sell fast can be acquired cheaply, meaning quite a large return on investment after simple, inexpensive repairs.
Make Repairs Your Way
There are some buyers who would prefer to be at the helm of any repairs, changes or renovations to a home they plan to occupy, and so buying a desirable property “As-Is” puts them in charge of any work. This allows you to make repairs your way, using contractors you choose and trust, while personally overseeing any and all work.
Faster Closing in Some Cases
Some “As-Is” properties are priced low with any repairs or changes offered in order to make them sell fast. The option for a quick cash offer is more feasible for the lower price. If a faster closing process is appealing to you as well, you could buy the “As-Is” property for cash and close the deal considerably faster than the normal process involving a lender.
Tips for Buying a Home “As -Is”
If you believe buying a home in South Carolina “As-Is” is a desirable option, follow these tips to do your “due diligence” in every aspect.
Pay Attention to the Law
South Carolina law requires sellers to provide prospective buyers with a written disclosure statement that informs you of any known problems with the home or property. This statement can be delivered in person or electronically.
The South Carolina Real Estate Commission has a free sample disclosure form you can download that lists all the areas that must be included in the report. The seller must answer "Yes," "No" or "No Representation" to each question.
The disclosure must include information about:
The water supply and sanitary sewage disposal system
The roof, chimneys, floors, foundation, basement and other structural components
The plumbing, electrical, heating, cooling and other mechanical systems
Any past or present, unrepaired infestations of wood-destroying insects or organisms
Applicable zoning laws, restrictive covenants, building codes and other land-use restrictions affecting the property, encroachments from or to adjacent property, and notices from a governmental agency affecting the property
The presence of lead-based paint, asbestos, radon gas, methane gas, an underground storage tank, hazardous material or toxic material, buried or covered, and any other environmental contamination
The existence of a rental, rental management, vacation rental or other lease contract in place on the property at the time of closing, and, if known, any outstanding charges owed by the tenant for gas, electric, water, sewerage or garbage services provided to the property the tenant leases
The existence of a meter conservation charge that applies to electricity or natural gas service to the property
If the property is subject to governance by a homeowners association
Pay Attention to the Home Inspection Report
In addition to the disclosure statement, you should carefully examine the report from a licensed and experienced home inspector. His or her report will provide a comprehensive view of the general condition of the home and its major systems. It may also include recommendations for further specific inspections if the home inspector detects more extensive deficiencies or problems. They may recommend:
- A structural inspection
- An HVAC inspection
- An electrical inspection
- A plumbing inspection
- A pest inspection
- A mold inspection
Any problems discovered by one or more of these specialists could mean substantial repair costs you may wish to avoid.
The home inspection report will also detail recommendations for other, smaller repairs or deficiencies that you want to consider. Use this list for the next step.
Pay Attention to Repair Cost Estimates from Local Professionals
Armed with the home inspection report, sellers disclosure document, and any other inspection reports, obtain cost estimates from leading local repair and renovation professionals. We recommend getting at least five estimates for each repair for comparison. Depending on the time of year, some top contractors may be overly busy and unable to take the job, so you need some backup choices, too.
Use these price estimates to calculate a close approximate cost for any and all repairs, renovations or other changes you wish to make. Add this total to the sellers’ asking price to get a grand total for what you may be expected to spend. The “As-Is” property could end up being a real steal — or it could prove to be a real money pit. Only you know what you can/want to spend for real estate in South Carolina, and how much time you wish to invest. Be wise and weigh all the factors involved before committing to a contract.
Jeff Cook Real Estate can help when you’re looking to buy a home in South Carolina. Contact us today at 855-HEY-JEFF or online and speak with one of our talented and knowledgeable real estate professionals.