New rules for property sales: Ban on 'as is' clause from 2022

Previously, it was very common to sell properties "as is" or with similar reservations. From January 1, 2022, this is no longer allowed in consumer purchases. This article explains the regulations and limitations that now apply.

Main rule: Prohibition against general reservations in consumer purchases

The Alienation Act § 3-9 second paragraph stipulates that "as is" reservations and similar general reservations have no effect in consumer purchases. This applies to:

• All general reservations about the property's condition

• Also vague or unspecified reservations

• Regardless of whether the seller is a business or a consumer

The prohibition is intended to ensure that the buyer gets a realistic picture of the property's condition and that the seller cannot disclaim responsibility for hidden defects and deficiencies.

Specified reservations

Even in consumer purchases, it is still permissible to make specified reservations. These must be:

• Concrete and precise reservations

• Related to specific aspects of the property

• Clearly communicated to the buyer

• Based on matters stated in the condition report or other documentation

The buyer must be given the opportunity to assess the significance of the reservation before making a purchase decision.

In other property purchases

For purchases that are not consumer purchases, § 3-9 first paragraph still applies. This means that "as is" reservations are valid, but with the following limitations:

• The seller's duty to provide information takes precedence over the reservation:

  • The seller must inform about significant circumstances

  • The reservation does not protect against violations of the duty to provide information

  • Incorrect information may constitute a defect

• The materiality threshold:

  • The property may have a defect if it is in a "significantly poorer condition" than the buyer could expect

  • The assessment is based on the purchase price and other circumstances

  • It takes a lot to reach this threshold

Consequences when reservations do not apply

When "as is" reservations cannot be enforced, either because it is a consumer purchase or due to the restrictions, then:

• The assessment of defects will be conducted according to the general rules in the Alienation Act chapter 3

• The seller is liable for all deviations from the agreed or expected condition

• The buyer can assert claims for defects according to ordinary rules

Conclusion

The new rules represent a significant strengthening of consumer protection in home purchases. The seller can no longer disclaim liability through general reservations but must provide specific and complete information about the property's condition.