Should You Buy a Property “As-Is”? Insights from the Chamber & Tom Mork of Edina Realty

When browsing listings on those popular home-buying apps, you may come across a property listed as-is. It might seem like a great deal—perhaps priced lower than similar homes in the area. But what does as-is really mean, and should you consider it? We spoke with Tom Mork of Edina Realty to get the inside scoop.

What Does “As-Is” Really Mean?

A property listed as “As-Is” does not automatically mean that the home has major issues.  In simple terms, an as-is property means the seller is stating that they are not willing to make repairs or offer credits for any issues uncovered during an inspection. The home is sold in its current condition—good, bad, or ugly.

This doesn't mean you can't inspect the property, but it does mean the seller is not automatically obligated to fix anything which is no different than any other sale. “An as-is sale simply means that the seller chooses to sell as-is and does not choose to make any repairs,” says Tom Mork. “It’s important to go in with your eyes wide open.”

No Disclosures—What’s the Catch?

Some as-is properties come with another wrinkle: no disclosures. In Minnesota, sellers are typically required to disclose known issues with the home that can affect a buyer’s value, use, or enjoyment. However, if the property is part of an estate sale or owned by a bank, or the seller has never lived in the home and claims to have no knowledge of the condition, the seller may not be required to provide full disclosures.

"This doesn’t necessarily mean there are problems," Tom explains. "But it does mean the buyer needs to do extra due diligence."

When Does an As-Is Sale Make Sense?

Buying a home as-is might work in your favor if:

• You’re an investor or experienced renovator.
• The home is priced below market value, leaving room for necessary repairs.
• You have the funds and expertise to handle potential issues.

But if you’re a first-time home buyer or don’t have extra cash for surprises, an as-is purchase can be risky. An inspection contingency is always recommended which will help mitigate that risk. A buyer should also keep in mind that any negotiations for any repairs will always need to be agreed upon prior to closing.

“It’s important to remember that after closing on a property, all sales are as-is,” Tom said, adding, “Unless the seller has provided a full disclosure, and you can prove they did not disclose an issue that they knew about which effects the buyer's value, use, or enjoyment of the property.”

Tom’s number one piece of advice regarding as-is properties? “I would always recommend getting legal advice if there is a question or concern.”

How to Protect Yourself When Buying As-Is

If you're considering an as-is home, Tom Mork offers these tips:

• Get a thorough inspection – Even if the seller won’t fix anything, knowing what you’re dealing with is crucial. With an inspection contingency, the buyer will have a chance to attempt to renegotiate or cancel the sale prior to closing, even on an ‘as-is’ sale.
• Research permit history – Unpermitted work can lead to expensive fixes later.
• Factor in repair costs – Budget for worst-case scenarios to avoid financial strain.
• Consult a real estate professional – An expert can help evaluate whether the deal is worth the risk.

Final Thoughts

An as-is home isn’t necessarily a bad investment, but it requires careful consideration. “Sometimes it’s a hidden gem, other times it’s a money pit,” Tom Mork said. “The key is knowing the difference before you sign on the dotted line.”

If you’re thinking about buying a property as-is, talk to a trusted local real estate expert and make sure you understand what you're getting into. The Chamber is here to connect you with resources and professionals who can help make informed decisions in today’s market.