A homeowner may need or want a quick house sale for a number of reasons — divorce, illness, changes in employment — but is it a good idea to use a cash house buying company to speed up the sales process?
In the UK, the average house sale takes over four months from the first day of marketing to legal completion. Waiting this long is not an option for some people. The COVID-19 pandemic continues to impact every area of our economy, and transactions are taking longer to complete. As many people rush to sell their homes before thousands of potential buyers drop out of the market due to rising unemployment and the end of the stamp duty holiday on 31st March 2021, houses are selling faster and at record-breaking prices. However, buyers are having to wait longer to get the keys to their new homes because the housing industry is struggling to process the backlog of housing transactions that have accumulated due to the house-sale freeze during lockdown.
If your circumstances mean that you can’t afford to wait months for the right buyer and a failed sale would be catastrophic, selling to a quick house sale company could be the ideal solution.
What Is a Quick House Sale Company?
A reputable quick house sale company will have the funds to buy your house outright for cash in as little as seven days after it has been valued. Unlike a traditional on-market sale, you will not need an estate agent, your home does not need to be advertised and there will be no viewings. Furthermore, you will avoid many of the fees associated with a traditional house sale, including estate agent fees, solicitor’s fees and surveyor’s fees.
What’s in it for them? The company will make you a cash offer that falls slightly below the market value of your home, then sell the property on for a profit.
What Are the Benefits of Selling to a Quick House Sale Company?
- Speed — If you’re in a rush, finding a cash buyer is the fastest way to sell your property. Once the company has valued your home and made a firm offer, they can often complete the sale in a matter of weeks.
- Cost Savings — The fees associated with selling a house on-market can quickly add up. According to Which?, the average estate agent fees in the UK are 1.42% of the sale price, but they can be as much as 3.5%. This represents fees of £3,379 to £8,328 for a house that sells for the average price in the UK — £237,963. Add solicitor’s fees and the cost of valuation to this, and your return on investment quickly diminishes. Selling to a quick house sale company allows you to avoid all of these costs, which goes a considerable way in making up for the below-market sale price.
- Hassle-Free — Many people are forced to sell their homes due to unexpected and difficult changes in their personal circumstances, such as separation or loss of income. Enduring countless viewings and months of living in limbo while waiting for the right buyer to come along can be too much of an emotional strain at an already challenging time. Selling to a house buying company means a quick sale with no need for strangers traipsing through your home.
- Zero Risk of a Failed Sale — This is the only way to 100% guarantee a sale. On-market transactions are vulnerable to the problems that arise from being in a property chain, which can mean minor delays and frustrations at best and a failed sale and the need to start all over again at worst.
- No Need to Make Expensive Home Improvements — A quick sale company will buy almost any type of property regardless of its condition and location. There’s no need to spend precious time and money on sprucing up the house to boost its value and attract buyers.
- Avoid Repossession and Clear Debts — A guaranteed cash sale is the quickest and most reliable way to raise the funds you need to avoid repossession and/or clear debts.
A cash house buying company is a great choice for sellers that are in a hurry, but you should do your research to find a reputable company that can offer a deal that suits your needs.
Are There Any Risks Involved?
The quick house sale market isn’t regulated so, unfortunately, some unscrupulous companies will gladly secure your business via all means of unethical trickery. Consumers aren’t currently protected when selling a property to one of these companies, so you must do your due diligence.
The Competition and Markets Authority (CMA) — formerly the Office of Fair Trading (OFT) — has identified six practices that should sound alarm bells when you’re shopping around for a company to sell your house to.
- “Hidden” Fees — Some companies will make an offer and then add extra fees after the customer has agreed to proceed. Progress of the sale is often contingent upon these fees being sold. A homeowner that is desperate to sell and is working against the clock may gradually be persuaded into parting with thousands of pounds to avoid losing the sale.
- Last-Minute Price Reductions — An unscrupulous house buying firm may make a generous offer, then drop it considerably as the sale process nears completion. This makes it almost impossible for people — many of whom are already in a vulnerable position — to pull out of the deal, forcing them to accept a sale price that falls significantly below their expectations and the original price agreement.
- Misleading Claims — Quick sale companies make their money by buying properties at a price below their market value and selling them on. Some companies will try to attract customers by claiming to pay a competitively high percentage of a home’s value when, in reality, they adjust their valuation to make it appear as though they are buying at a smaller discount than they are.
- Brokers Masquerading as Cash Buyers — Some firms will market themselves as a cash buying company when they are actually operating as a broker and will pass your contact details on to a third party.
- Restrictive Contracts — If a company attempts to lock you into a contract that prevents you from selling to anyone but them for a fixed period, run for the hills! They could be buying time to pass your business on to a third party or to secure the finances they need to buy your property — both will delay the process, defeating the point of using a “quick” house sale company in the first place.
- False Promises — Make sure the company you use has the funds to buy your property as quickly as they say they can. Some companies will promise a speedy sale then delay the process because they are struggling to obtain the funds to buy your property. A reputable company will be happy to provide evidence of funds.
Is a Quick House Sale Company the Right Choice for Me?
A quick house sale company will not be the right choice for every homeowner. If you have plenty of time to spare and can cope with the stress and hassle of viewings and a potentially long wait for a successful sale, selling via the traditional on-market route will allow you to achieve the best price for your home.
If, however, you’re in a rush to sell or are feeling emotionally vulnerable and ill-equipped to manage the disruption of viewings and a protracted sales process, a quick house sale company could be the ideal solution. Provided you put the time and effort into finding a reputable company that makes an offer you’re happy with, a cash buying service could help you move on quickly and make a fresh start.