17 August 2018
When selling your house, two of the most important factors to consider are price and time frame.
While some sellers may be in a position to sit on their property and wait for the best possible value, others may need to sell their house in a hurry.
In the latter case, if your sale is urgent and you want to complete as soon as possible, it’s important to recognise that there will often be a trade-off between price and selling time.
That said, in this post we’ll show you some of the ways to achieve a fast sale without taking too much of a hit on the price…
Traditional Estate Agents
Traditional high street agencies have seen their market share being challenged by the new breed of online players (see below). However, some vendors prefer to use them as they often have local knowledge and expertise.
At the same time, many have been known to deliberately overvalue properties to win instructions due to fierce competition to sign up home owners. This leads to a slow sale process as sellers are often forced to gradually adjust their price to find a buyer.
Occasionally, an unsuspecting buyer will overpay for a property listed on the high street so sometimes the vendor can end up with a higher price – but this is rare.
In most cases therefore, do not expect the sale to be quick. The fees to sell are also often higher than online agencies due to increased overheads.
If you choose to go down this route, here are some tips to ensure you get the best outcome:
- Look for a professional with proven experience and good local knowledge;
- Check how many properties they’ve sold in recent months;
- How fast have they been able to sell the properties on their books? What has been the difference between the asking and actual sold value (recorded at the Land Registry)?
- Make sure the house will be advertised on all the major portals such as Rightmove, Zoopla and Prime Location;
- Cross-reference the estimated asking price with sold prices (using tools such as Net House Prices, Property Price Advice and Mouseprice);
- Confirm that the agent can do viewings in the evenings and weekends, a common time for people to go out house-hunting;
- The agent should have systems in place to deal with out of office enquiries;
- Ask how they will be giving you feedback on viewings;
- Make sure you run through the contract – check for any tie-ins, multiple agency restrictions and other potential pitfalls in the small print;
- Make sure the fee you’ll be getting charged is in line with other agents in the area.
Express Estate Agencies
Express estate agencies have emerged as homesellers look for a more efficient online service. They will typically use aggressive pricing to generate an offer within a shorter timeframe.
The advantage of express estate agencies over traditional estate agents is that you will avoid situations where your house may get valued over-ambitiously. This invariably leads to wasted time while the price is slowly lowered until an offer is made.
Many of the tips that apply with traditional estate agents (above) would be the same here, but it’s also worth considering the following:
- Make sure the agents / viewing professionals are knowledgeable about the local area;
- Understand the process and make sure it’s not too impersonal;
- Check whether the viewings will be accompanied or not;
- Check out the reviews pages (a simple Google search will bring up relevant feedback);
- Look at other properties the agent is marketing online and make sure the quality of the photos, floorplans, descriptions etc. is good;
- Confirm how easy it is for prospective buyers to book viewings;
- Understand the fee structure and other terms. Remember, if you pay up-front, there is a risk you will lose your money if the agent doesn’t sell. Some may offer a ‘deferred’ payment option, but this means that you will still have to pay after 10-12 months.
Hybrid Estate Agents
Hybrid estate agents combine the functions of traditional and online estate agents.
The benefit is that they offer cheaper prices than high street / local estate agents while offering many of the same services – such as using local ‘experts’ to value homes, meet potential buyers, list the property and so on.
Their running costs are relatively low. So, although they may value your property at the same price, you will save money on the fees charged for handling viewings, offers and negotiations compared to traditional estate agents.
Again, many of the same checks will apply as with traditional and express estate agents – but you may also want to run through the following:
- Check that local experts have the right kind of experience to help you sell your property fast;
- Ask if there will be extra costs to have the accompanied viewings, and if there are any limits;
- Check the costs of any ‘add ons’ to avoid nasty surprises down the line;
- Be mindful that a ‘no win, no fee’ agreement usually works out to be more expensive;
- Confirm that area that the expert covers is not too wide which may dilute the level of service you get.
Online / Offline Auctions
Selling via auction can work well – especially for unique, quirky and problem properties. You’ll often find that buyers are more serious, so there’s better chance of a faster sale.
Also, once the hammer falls, contracts are exchanged. This means that the buyer usually has between 20 and 28 days to complete the sale, or else lose the deposit and any fees paid.
However, auctions can be risky. Although you will establish a minimum reserve price, you will still need buyers to bid against each other to get to that level.
Should you be thinking about putting your property up for auction, it’s worth taking the following factors into consideration:
- Check the commissions, advertising costs, admin, room hire, accessing the agent’s online platform and legal costs. These can often amount to more than putting your property up with an estate agent;
- Ask the auction house how long the sale takes from start to finish. Future Auctions, for example, have indicated that it can take up to 3 months in reality;
- Check the suggested reserve price. There are some auction houses that overprice properties to win business in the same way estate agents do;
- Make sure your legal pack has no problems is to avoid any unnecessary complications during the process.
Modern Method of Auction
Sometimes referred to as a conditional auction, this can be best described as a cross between an estate agency sale and an auction sale.
The buyer places a non-refundable reservation fee and then has time (usually about 28 days) to exchange and then complete (another 28 days). Paying this fee is a real bonus, as 1 in 3 sales on the open market fail due to buyers withdrawing their offer. It also means that only buyers who are seriously interested in purchasing your property will make an offer.
As it’s quite a new concept in the property industry, it remains to be seen if it will become a mainstream way of selling.
Many of the checks worth making would be the same as with an online/offline auction house. However, you may also want to confirm that:
- The reservation fee amount is a significant commitment for the buyer. If it’s too low, the buyer may not be too bothered about pulling out;
- The terms of the exchange and completion are watertight;
- Any agreement stipulates that there can be no alteration in the price between after the reservation fee has been paid and the exchange of contracts.
Quick House Sale / Cash Buyers
Cash buying firms are a relatively new phenomenon, but a good option to consider when looking for a fast sale.
With a quick cash sale, you will typically receive up to 75% of the full market value – depending on its condition.
However, the benefit is that they are much faster than estate agencies and auction houses. As a general rule, you’ll be able to complete in just 7 – 14 days. These companies do not rely on external finance and take out the right insurance policies, enabling them to work to strict deadlines.
In addition, quick sale firms do not charge additional fees like estate agents and auction houses. This helps to offset the reduction in the selling price that is inevitable when dealing with them.
Before using a quick house sale firm, always make sure you check through the following:
- Ensure that the firm explores all your options before explaining how they work specifically;
- Make sure that the company is registered with the National Association of Property Buyers (NAPB), and therefore the Property Ombudsman;
- The firm should be registered for Anti-Money Laundering regulations at HM Revenue & Customs;
- You should ensure that any data you provide to the firm is legally protected. The firm should therefore be certified at the Information Commissioner’s Office (ICO);
- Ask how long they have been in business;
- Check the company’s details on Companies House. These days there is more downloadable information than ever before on this website;
- Ask for proof of cash funds. The firm should be able to send you a bank statement or a letter from their solicitor. If they are a using any kind of ‘instant cash’ debt facility, ask about the specific terms of the loan. This is essential to check – if they are not true cash buyers, they will not be able to complete a sale within your required timeframe;
- Request for a copy of the buyer’s personal credit report (even if the property is being bought through a company). They should send you something from a reputable company like Experian, Check My File or Call Credit;
- Look out for hidden charges or fees;
- As with any property service, check reviews and feedback online;
- Request for confirmation from their solicitors that the offer price will not be dropped at the last minute, usually just before exchange of contracts.
If you’re looking to sell your house as quickly as possible this could be the best option. But keep in mind that you will not receive the full market value, and make sure to confirm that they are true cash buyers who do not charge fees before proceeding.
Ruban Selvanayagam and James Durr are co-founders of the hybrid estate agency Property Solvers that offers quick cash sale and low-fee express estate agency services across the UK.
This content has been provided to us by the writer. Whilst believed to be factually correct, we cannot accept responsibility for content contained within it.