Selling a House ‘As Is’ in California
Maggie Titus | December 15, 2022
Maggie Titus | December 15, 2022
Looking to sell a house “as is” in California? Whether you’ve got a fixer-upper or recently inherited a relative’s home, sometimes the goal is to skip repairs, get a fair offer, and move on.
“Fear of the unknown is the main reason clients want to sell their property ‘as is,’” says top-performing real estate agent Rich Hernandez of Oxnard, California.
No matter their property’s condition, “if sellers open themselves up to giving credits or making changes to the home,” he says, “they don’t know where it might lead.”
However, selling a house “as is” usually means accepting a lower offer and it doesn’t always prevent buyers from trying to negotiate savings. Let’s take a closer look at how to sell a house “as is” in California, your options for getting an offer, and what to expect from the process.
| Median sales price in California | $863,790 |
| Average days on market for California | 25 to 53 days, depending on the region |
| Disclosures | California law requires sellers to disclose material facts about the property through the California Association of Realtors Real Estate Transfer Disclosure Statement and natural hazards in the Natural Hazard Disclosure Report/Statement. California’s Department of Real Estate provides additional information in its Disclosures in Property Transactions. |
| MLS has field to mark a listing “as is”? | No. Agents may comment about as-is conditions in the public or private remarks. |
| Is a real estate attorney required? | Real estate attorneys are not considered essential for closing in the state of California. |
| Real estate transfer taxes? | Local optional transfer tax $0.55/$500 (.11%)
Cities within a county that implements a transfer tax (.06%) can have a tax rate that is half of the county rate, $.275/$500, and the city tax can be applied as a credit against the county tax. Real estate instrument recording fee: up to $10 The NCSL Table provides the most updated information. |
“As is” is a type of home sale where it’s understood that no improvements will be made to the property. When selling a house, “as is,” the seller is choosing not to entertain requests from buyers to complete repairs or provide a credit for fixes.
An as-is sale may also indicate that the functionality and longevity of certain components of the home, such as a stove on its last legs or an older roof, is not guaranteed.
When selling a house “as is,” the general condition of the property should already be accounted for in the purchase price of the home to the best of the seller’s knowledge.
“Every single home in the state of California is sold “as is,’” Hernandez says. In fact, the as-is clause is written into the boilerplate, residential purchase agreement that all Realtors® use. ”While buyers have a right to ask for repairs or concessions,” he explains, “the seller doesn’t even have to respond.”
Homes sold “as is” often need some work or may be cosmetically outdated. It’s not a label you’re likely to put on a listing in pristine, move-in-ready condition.
“As is” sales often attract investors searching for their next flip or buyers seeking a bargain, perhaps on a home in a great location with lots of potential.
Hernandez reports California homes selling in distressed, as-is condition have been typically loved and well-worn by one family for many decades. These homes are usually built in the 1970s or later and owned by older baby boomers.
“They’ve not necessarily grown out of the home,” says Hernandez, who has 16 years of experience in the market, “but, they don’t have the resources to keep up with it.” The result is years of deferred maintenance.
Selling a house “as is” in California doesn’t mean sweeping known problems about the house under the rug.
A good time to fill out the California Association of Realtors Real Estate Transfer Disclosure Statement is prior to listing your home or requesting an offer so that you know it’s taken care of.
According to the document, the disclosure of the condition of the property is “in compliance with Section 1102 of the civil code.” The seller also certifies by the close of escrow the property will be in compliance with the State Fire Marshal’s standards for operable smoke detectors and the Health & Safety Codes requiring water heaters to be strapped in place.
The form will walk you through documenting what you know about the features of the home from the TV antenna to the number of remote controls for the garage door and the quick-release mechanisms on bedroom windows.
You’ll also be prompted to fill out information about malfunctioning electrical systems, plumbing systems, or other structural components. The form specifically asks the seller to disclose the presence of the following:
California sellers must also complete an additional disclosure form, the Natural Hazard Disclosure Report/Statement which shows whether the home is in zones predisposed to earthquakes, flooding, fire, or wildland risks.
The Golden State also requires sellers to let a buyer know information about the location of registered sex offenders is available from local law enforcement agencies and on the state-operated website.
California’s disclosure rules are complex. So, the California Association of Realtors created a comprehensive sales disclosure chart. No matter what method you choose to sell your home, it’s required to make these disclosures to the best of your ability.
Hernandez says all sellers must complete the Natural Hazards Disclosure and Transfer Disclosure Statement.
However, California does allow some exceptions from additional buyer requests for disclosure about certain items. Sellers are exempt from responding to some disclosures if they haven’t lived in the home and/or if they are “transfers by a fiduciary in the administration of a decedent’s estate, a guardianship, conservatorship, or trust except where the trustee is a former owner of the property.”
The main options to sell a house ‘as is’ include:
A great real estate agent will provide assistance throughout the process of listing and selling a home “as is.” An agent gives simple presentation tips to improve marketing, helps to set an appropriate price that reflects the home’s condition, and works to find a buyer willing and eager to buy your home in its current state.
Because he has extensive experience dealing with non-traditional properties, Hernandez works with the owners to maximize the home’s assets — and potential profit — with minimum effort and investment.
“We’re not showing it as a distressed home,” Hernandez says. “We’re marketing a previously loved property that needs a little bit more TLC from the next homeowner.”
After the home is decluttered and emptied, Hernandez usually provides a punch list of suggested small improvements that make the home appear less dated or worn.
For example, he commonly brightens the interior by taking down dramatic, big 1970s-1980s-era valances and window coverings. If the structure seems sound, a coat of paint and new carpet can freshen up dull walls, ceilings, and floors.
Not only do those relatively inexpensive updates attract buyers, but they also improve the property’s chances of being eligible for financing.
Someone needing to sell their home “as is” can also work directly with a property investor or house buying company rather than list, where it may be difficult to get an offer from a limited buyer pool.
We Buy Houses operations buy “as is” at a discounted rate and generally seek out homes in need of significant repairs. These companies can help sellers cash out quickly and many will cover a seller’s closing costs.
The level of integrity and customer service you experience can vary, even within an established house-buying company that strives to maintain consistent business standards. This is because many We Buy Houses companies are franchises and often use independent investors or local wholesaling outfits. Your experience greatly depends on the character of the person or group making the offer.
If you are considering a cash offer, vet the company thoroughly. Check reviews, read testimonials, and research its presence and performance in the market. And, of course, read the buying agreement carefully before signing.
Your choice of real estate agent always matters, but especially when selling a property “as is.” It’s important to find the right match. You’re looking for an agent who doesn’t shy away from listings that need a little TLC and maybe has a strong network of investor connections.
Your agent should also be willing to go the extra mile on marketing. Considering 80% of Americans say they would prefer to buy a move-in ready home, an “as is” sale likely has a reduced buyer pool from the start.
In looking for an agent to sell a distressed, as-is property, Hernandez recommends seeking a Realtor® who has experience with maintenance deferred listings and a well-honed list of auxiliary service providers.
For example, Hernandez recently worked with a client who inherited a home when her mother passed away. The client couldn’t bear to part with her mother’s possessions or the property for three years. By the time she decided to sell, the client was in her 70s and had significant physical limitations.
Hernandez called upon his network of professionals to help the client sort through the home’s contents and decide which items to keep, donate, consign or sell in an estate sale.
“With an ‘as is’ sale,” Hernandez says, “it’s important to work with an agent who understands the market, can maximize sales price with some small fixes, and has resources to help clients with what they need done.”
Beyond just having an idea of what’s best for the seller’s particular situation, Hernandez adds, a great as-is agent should be able to provide examples of properties they’ve successfully sold for other homeowners in a similar situation.
A pre-listing home inspection is the same as a standard home inspection except that the seller pays for it before listing their home on the market. It may sound like a counterintuitive step for an as-is sale, but getting the inspection results upfront can illuminate any issues that could impact the value of the home and inform an accurate pricing strategy. If a buyer requests further deductions to the price based on their own inspection, you may be able to point to how the estimated cost of certain repairs was already baked into the list price.
Hernandez does not recommend the seller pay for a pre-listing inspection.
“We already know the property is distressed and the sellers are going to disclose anything they know about,” says Hernandez.
So, there’s no need for the homeowners to further probe the property’s condition. “Buyers can do their own inspection;” says Hernandez, “but, the sellers still aren’t going to fix anything.”
The median sale price for homes in California hit $863,790 in June 2022, a 5.4% increase over the year prior.
Hernandez says that homes sold ‘as is’ in the area typically sell for 20%-30% less than regular listings. Some of the top factors that impact the value of an “as is” listing in California are clear signs of deferred maintenance including:
You can start with a free estimate from HomeLight’s Home Value Estimator (HVE).
Our HVE combs public data including tax records and assessments and pulls recent sales records for other properties in your neighborhood. Using a short questionnaire, we also factor in specifics about your home such as the property type and described condition. Input your address, and we’ll provide you with a preliminary home value estimate in under two minutes.
Even for as-is home listings in California, Hernandez typically recommends sellers complete the following:
“You’re going to be moving anyway, so first declutter and clean,” says Hernandez. If the property doesn’t need a big overhaul, Hernandez says his top three priorities are landscaping, painting, and carpet.
“I want to make sure we’re getting a return on investment,” Hernandez says. “Can I get $1.25 or more for every $1 I put in?”
Besides generating the biggest bang for the buck, Hernandez says, “If the home is not in bad shape structurally and the sellers invest in minimal yard work, new paint, and carpet, then buyers can get financing and live in the home while they fix it up.”
Your home listing warrants professional photography no matter what type of condition the property is in. A professional photographer will take steps to shoot each room from the best angle, ensure optimal interior and natural lighting, and edit for the ideal brightness and exposure.
A high-quality camera with a wide-angle lens is also essential to showcasing entire rooms rather than half or three-quarters of what’s there. For these reasons and more, professionally photographed homes can sell up to three weeks faster and bring in up to $11,000 more than their houses marketed without professional photos.
Your real estate agent will almost always arrange for professional photos as part of the listing process.
A home’s location will be important to buyers seeking out a home with potential. Mention in your as-is listing if your home is close to any of the following:
Unless you explicitly mention that your house is being sold “as is,” buyers will have no idea of your intentions with the listing. Other common descriptors mentioned in as-is listings in California include priced to sell, total fixer, in desperate need of repairs, bring your handyman or contractor, cash only, trust sale, and even, seller will not consider doing any repairs.
To balance the focus on as-is condition, work with your agent to craft a property description that highlights the best features of the home.
That description might include historic architectural details such as finials, stained glass, transoms or pocket doors, or kitschy components such as terrazzo floors, mirrored bar, retro color scheme, Formica countertops, or a sunken living room.
Listing “as is” provides no guarantee that buyers won’t try to negotiate savings on their purchase, even on an asking price you felt was already reduced to reflect the home’s condition. One of the best defenses you can have is an agent who takes a hard stance to prevent a deal from going south for the seller.
“Particularly if the buyer is coming in with cash at the highest price point,” Hernandez says, “I need to protect my seller with regard to terms.”
Often, that means advocating for the removal of inspection contingencies. “In California, when buyers agree to waive the inspection contingency,” Hernandez says, “they cannot back out of the deal for any reason — no matter whether they later find an issue with a property issue or even with regard to something such as the homeowner’s association.”
When you place your home on the market, it’s hard to predict if your top offer will come from a cash buyer or a buyer pre-qualified for a home loan.
But if you do end up working with a financed buyer, be aware that different mortgage types (such as conventional loans or government-backed FHA, USDA, or VA loans) have different minimum property standards. These are standards related to the overall condition of a property which will play a role in the willingness and/or ability of a lender to finance a buyer’s loan.
Before properties can be financed, their value and condition are typically examined by a state-licensed, independent appraiser contracted by the buyer’s mortgage company.
If you’re unsure whether your home will meet appraisal requirements, you can start by taking a look at the FHA minimum property standards. If your house complies with FHA, then it complies with most other lenders’ requirements.
On occasion, conventional lenders may even finance a fixer-upper property sold “as is,” and it’s not impossible to finance a fixer-upper with an FHA loan. However, if you’re selling a house “as is” — especially one that needs heftier repairs — you may want to consider accepting a cash offer if you receive one. Cash eliminates the lender-ordered appraisal as well as the time it takes to close on the buyer’s loan, creating a faster and clearer path to settlement.
“The biggest advantage of a cash sale is going to be the quick close,” Hernandez says.
With a cash sale, the sellers usually have their funds within 10 days of closing. If financing is involved, the turnaround is typically 30 days.
So, if they have the choice between a lower cash offer or a higher financed bid, Hernandez asks his clients: What’s the cost of getting financing for the 20-day difference? What does that mean to you in terms of time, interest, and equity?
Pros of listing a home ‘as is’:
Cons of listing a home ‘as is’:
Now that we’ve covered the general process of listing a home “as is,” let’s discuss the alternative of working with an investor. While the process varies from business to business, the steps to selling your home to a house buying company typically go something like this:
If you aren’t sure where to get a cash offer, consider Simple Sale, a solution from HomeLight. With Simple Sale, you tell us a bit about your home, such as whether it’s a single-family or condo and how much work it needs. From there we’ll provide you with a full cash offer to buy your home in as few as 48 hours.
No need to call the roof inspector or drain your savings to replace the HVAC. HomeLight will provide an offer for homes in almost any condition.
Want to get out right away? Or need a little more time to pack? Either way, we’re flexible. Pick a move date that works for your schedule within 30 days of closing.
Cash buyers don’t need a lender’s involvement to purchase a home, meaning they can move nimbly and quickly compared to someone who needs financing. With Simple Sale, you can close in as little as 10 days, compared to the 30-60 days it typically takes to close with a financed buyer.
Below we’ve compiled a list of some of the leading companies that purchase homes “as is” for cash in California and information about each.
Website: sellquickcalifornia.com
Phone number: (866) 497-8248
Locations: All of California
Since 2018, Sell Quick California has been buying homes of any condition — no repairs or cleaning required. According to Sell Quick California’s website, its team has experience working with owners who need to:
The company goes so far as to say: You don’t even have to clear out the rotten food from your refrigerator for your home to be eligible for purchase. Just request a fair cash offer, choose your closing date, and walk away. Sell Quick California was accredited with the Better Business Bureau in 2019 and has an A+ rating.
Closing costs: You pay no closing costs; Sell Quick California covers them.
Reviews: With 37 Google reviews, Sell Quick California maintains a 5-star rating. Past sellers comment on fast and transparent communication from owner Marc Afzal as well as quick sales and fair offers. Some reviewers comment Marc was excellent at informing sellers of all their options, even if that led them to sell elsewhere.
Website: socalhomebuyers.com
Phone number: (951) 331-3844
Locations: San Bernardino, Riverside, Los Angeles, and San Diego
SoCal Home Buyers is a family-run investment firm that buys properties including single-family fixer-uppers and turn-key multi-family homes. The website even says they can work with tenant-occupied properties and can accommodate owners who live out of state with no traveling needed.
After receiving information about your home and completing an inspection, the company can offer a closing as short as seven days. SoCal Home Buyers has been in operation for over 11 years and has an A+ rating from the Better Business Bureau.
Closing costs: You pay no closing costs; SoCal Home Buyers covers them.
Reviews: SoCal Home Buyers has 27 Google reviews, including 25 5-star reviews. Reviews speak of a quick process all around, from the initial communication all the way to closing. Customers also praise the employees’ friendliness and warmth as well as their transparency and professionalism.
Website: premierpropertybuyers.com
Phone number: (786) 847-7605
Locations: Southern California
Premier Property Buyers is a Southern California house-buying company that purchases homes, no matter their condition or the owner’s situation. The company specializes in properties located in Orange, Los Angeles, Riverside, San Bernardino, and San Diego counties. The company has been in operation since 2003 and became Better Business Bureau accredited (A+ rating) in 2018.
When Premier Property Buyers provides you with an offer, the company also shares the numbers that went into calculating that amount. They charge no fees, cover your closing costs, and can close on homes in as little as a week.
Closing costs: You pay no closing costs; Premier Property Buyers covers them.
Reviews: Southern California customers praise Premier Property Buyers with 19 5-star Google reviews. Past sellers speak to owner Eric Nerhood’s service and demeanor, commending his knowledge, patience, and responsiveness throughout the entire sale process. Reviewers also note fair offers, especially compared to other area companies they explored.
Website: laurelbuyshouses.com
Phone number: (916) 476-2381
Locations: Sacramento area
Laurel Buys Houses tells home sellers “flipping houses is our passion.” The company has purchased more than 300 homes in the Sacramento area over the past 20 years. Laurel Buys House has been accredited with the Better Business Bureau since 2017 and maintains an A+ BBB rating. The company purchases all kinds of houses “as is” houses. You can even leave unwanted items behind. “We go through every unwanted item and set aside anything that can be given a second life,” the company explains on its website.
After collecting information about your home online or over the phone, Laurel Buys Houses will conduct a home visit either in-person or virtually and provide an all-cash offer. If you accept the offer, the company says it can accommodate tight schedules, and in some cases close in a few days if necessary.
Closing costs: You pay no closing costs; Laurel Buys Houses covers them.
Reviews: Laurel Buys Houses has accumulated 61 reviews on Google for a 4.7 out of 5-star rating. Many reviews speak of Laurel’s Honesty, kindness, and interest in doing what’s right for its clients. Customers also praise fast closings and a seamless, stress-free home-buying process.
Website: reworkcashoffers.com
Phone number: (916) 866-3327
Locations: Sacramento area
Rework Cash Offers buys and renovates houses all over the Sacramento area. Owner Pratik “Pat” Pathapati started the company in 2016. To receive an offer, homeowners can call to provide information about the property or use an online form on the Rework Cash Offers website. A company representative will schedule a time to meet with you at the property and do a walk-through before providing a cash offer.
Rework Cash Offers assures sellers that “no house is too difficult for us.” For sellers who can’t move until they sell, Rework Cash Offers provides “rent back” options wherein the company buys your house and then rents it back to you so you have the cash you need to move to your next home.
Closing costs: You pay no closing costs; Rework Cash Offers covers them.
Reviews: Rework Cash Offers has an A+ rating from the BBB. The company has 12 Google reviews, all of them 5-star ratings. Reviews speak of Pat’s honesty, fairness, and professionalism, and express their appreciation for a straightforward, easy process.
Website: sellersadvantage.com
Phone number: (800) 208-3243
Locations: Los Angeles, Arcadia, Costa Mesa, Corona, Lomita, Oxnard, Pasadena, Rancho Palos Verdes, Riverside, San Dimas, Sylmar, Temecula, Whittier, Ventura, San Francisco, The Bay Area, San Diego and Napa
Headquartered in Irvine, California, Sellers Advantage is a family-owned company, which has been in business for 25 years.
On an online form or during an initial phone, Sellers Advantages collect your property details and learn about your situation and closing requirements. Next, a company representative arrives for a home inspection and provides you with a firm cash offer. Even though the offer is presented at the time of home inspection, there is no obligation and you can take as much time as you need to make a decision. If you accept, Sellers Advantage arranges a cash transaction, opens up escrow and title to complete the purchase based on your time requirements.
Closing costs: Sellers Advantage pays all closing costs.
Reviews: Google reviews from 177 clients have earned Sellers Advantage a rating of 4.7 out of 5 stars. Sellers Advantage has also received an accreditation and an A+-rating from the BBB. Clients are quick to say Sellers Advantage lives up to the promises the company makes on its television ad. The Sellers Advantage team is described as knowledgeable, efficient, communicative, flexible, responsive and friendly. Sellers were also delighted with the company’s simple process and willingness to take homes that had not been emptied or cleaned by the seller.
Pros of selling ‘as is’ to an investor:
Cons of selling ‘as is’ to an investor:
There is no simple equation for calculating how much you’ll net from an “as is” sale. If you list on the market with an agent, you’ll need to account for the cost of agent commissions (around 5.8% on average) and other closing costs such as title fees and taxes, but are likely to field higher offers from buyers and see more competition for the home.
In general, as-is, distressed listings garner 20% to 30% less than updated homes. Most California homes from the 1970s and 1980s don’t have the open-concept floor plan popular today, so buyers expect to invest a lot of time and money in updating.
However, because the market has been so competitive, “There are buyers willing to take those homes with just updated paint rather than a complete remodel,” says Hernandez. So, it’s possible to increase the value by 5% by improving those cosmetic items alone.
Different types of investors and house-buying companies also offer varying amounts for homes, largely dependent on their exit strategy. While fix ‘n’ flip investors usually pay around 70% of the home’s after-repair value, buy-and-hold investors who plan to rent out your property may be able to pay more. In addition, investors are often willing to cover a seller’s closing costs which can add up to around 1%-3% of the sale price. HomeLight’s net proceeds calculator can be helpful for running through some possible selling scenarios and estimating your take-home pay.
While every home sale is different, you should now be familiar with the general process of selling a house “as is” in California. Now, you can begin to weigh which method will work best for you.
A few months ago, Hernandez worked with an older gentleman who was moving to Arizona. After the client cleaned out his condo, Hernandez explained three key selling tips:
Hernandez offered to front some funds for repayment with no interest at closing, have his project manager oversee the work, and allow the client to choose the contractors. But, despite the fact he could realize an additional $23,000 to $50,000 with a little more time and effort, the client chose to sell the property with no changes.
“And, that’s OK because it’s really about the sellers and what they want to accomplish,” says Hernandez. “Do sellers want or need to get out quickly? Do they want their money quickly but also they need to spend more time in the home? Do they want to maximize the sales price? A well-rounded agent offers the seller all the options.”
Whether you choose to list “as is” with a real estate agent or work with a direct home buyer, a home doesn’t have to be in perfect condition to sell — so long as you provide disclosures as necessary, set the right price, and know what to expect going in. Whenever you’re ready to take the next step, HomeLight would be happy to assist with your real estate needs. Connect with a top agent near you or get started with a cash offer from Simple Sale.
You’ve got questions and we can’t wait to answer them.