Trying to sell a property in disrepair? Here’s what you need to know
If you’re trying to sell a property, that needs some restoration or renovation work, then you may be wondering whether you will be able to get a buyer.
Properties in poor condition can be sorted into two categories, each with their own challenges and their own buyer types.
For this type of property, estate agents will use language such as 'requires updating' or 'ideal DIY project'. This is a home that has become old fashioned - perhaps the kitchen and bathroom need replacing and the décor needs a facelift.
These properties appeal to younger buyers who are keen to pick up a bargain they can put their own stamp on. They often generate interest but if the repairs needed are too extensive, the chances there will be difficulty obtaining a mortgage are high - so even the keenest buyer might have to pull out of the sale.
Unfortunately, it is sometimes difficult to predict the degree of restoration required that will cause this to happen, but in general the home must have a functioning kitchen, bathroom and heating system in order to be mortgageable.
A draw for developers or cash buyers only
The second style is often referred to as 'ideal for a developer' or 'cash buyers only'. This is the kind of property that cannot be lived in until substantial works have been carried out. This might include roof work, damp prevention, a new kitchen, wiring and heating, woodworm treatment etc.
This type of property will be almost impossible to borrow a mortgage against so will almost exclusively appeal to professional buyers, be it a local builder, developer or cash buying company.
Often properties like this receive a lot of local interest but the scale of work can be underestimated by many who are not as experienced with buying and selling properties which makes them highly likely to fall through later down the line. Afterall, up to 30% of standard sales go wrong and the figure is much higher for homes in poorer condition.
How to sell a property in a poor state of repair
Auction is often a good route for easier sale, but sellers don’t like the upfront costs or the uncertainty of the price. It’s also worth bearing in mind that up to 25% of auction lots never sell.
Professional cash buying companies are used to buying 'difficult' properties and there are usually no costs either upfront or after the sale. A guaranteed price and sale appeals to many who find a dated property a worry to try to maintain.
Reader’s Digest Property - a partnership between Reader’s Digest and property buying company House Buy Fast - offers this cash buying service. As part of the service we buy any house, in any condition.
House Buy Fast is a member of the National Association of Property Buyers and follows a code of conduct set out by The Property Ombudsman.
To find out more call us on 0800 433 7979 or fill out the form below.