It’s never a good feeling being left needing to sell your house. But choosing what you do next will affect how much cash you end up with in your bank and how fast this happens. Let’s take a look…
If you need to sell your house fast, what are your options and what should you do?
- Reduce the asking price of your house listing.
- Change estate agents.
- Bring on more estate agents and go multi-agency.
- Try to sell your house at auction.
- Sell to a cash home buying company.
- Sell your home on a lease option contract.
- Consider selling your house with the aid of an assisted house sale.
Let’s take a look at each of these in more detail:
1. Reduce the asking price of your house listing
You need to drop your asking price by at least 10% to make any difference to the speed of your house sale.
Otherwise if you need to sell your house fast a smaller percentage drop may not be enough. But it depends on how quickly you need to sell and how much your house is currently listed compared to similar properties.
If you’ve decided on this option, don’t drop the listing price by small amounts. Be bold and do it quickly. But also consider the price ceiling of your road too. To help sell your house fast try to price your home at less than the highest sold price for your size and type of house in your neighbourhood.
To help you work this out easily, here are Rightmove‘s price bands.
Rightmove price bands:
- No minimum to £50,000.
- £50,000 to £120,000: £10,000 increments.
- £120,000 to £125,000: One £5,000 increment.
- £125,000 to 170,000: £10,000 increments.
- £170,000 to £175,000: One £5,000 increment.
- £175,000 to £300,000: £10,000 increments.
- £300,000 to £500,000: £25,000 increments:
- £500,000 to £700,000: £50,000 increments.
- £700,000 to £1,000,000: £100,000 increments.
- £1,000,000 to £2,000,000: £250,000 increments.
- £2,0000,000 to £3,000,000: £500,000 increments.
- £3,000,000 to £5,000,000: £1,000,000 increments.
- £5,000,000 to £10,000,000: £2,500,000 increments.
- £10,000,000 to £20,000,000: £5,000,000 increments.
However, if the estate agent you’re using is no good and isn’t proactive, this solution could backfire in any event. Which leads on to the next point.
2. Change estate agents
A Change of estate agents may solve your problem if you need to sell your house fast, but it won’t make any difference if your house is over priced in the first place.
Before you change, speak to other agents to see how they value your house and why they think your house isn’t selling as quickly as you’d like.
You’ll need to check your contract with your current estate agent. You can only change estate agents if your contract has come to an end.
This is definitely worth considering if you’re using a low budget or cheap online estate agent.
However, if you are still in contract, the following option may work for you.
3. Bring on more estate agents and go multi-agency
Be aware that if you opt for a multi-agency deal to sell your house this has the highest estate agency commission cost of between 2.5 to 3% plus VAT of the final sales price.
It usually works whereby the estate agent that sells the house is the one that gets all the commission. Whilst the other agents get nothing.
But before you go signing up to a multi agency deal with another estate agent, first check that your current agent agrees to this.
If you go ahead in any event and sign up with one or more other estate agents, and if you’re still in contract with your current agent, you will also be liable to pay their commission too. Or you’ll be in breach of contract.
This is a good option if you need to sell your house fast. But be prepared for the agents to try and persuade you to accept low offers.
However, with this arrangement your buyers are still likely to be in a conveyancing chain. This will mean the conveyancing process may take some time. Plus it could still fall through if the buyer’s sale also falls through during the process.
This leads on to considering the next four options.
These next four options are all fast ways to sell a house. But each have their pros and cons, which I will explain at the foot of each option.
4. Try to sell your house at auction
Selling a house at auction will sell your house fast and means that completion day will be within 28 days from the hammer falling.
But sales at auction are by no means guaranteed, as not all properties sell on the day, as it depend on the level interest on the day and how high you set your reserve price.
You can expect to receive around 75-80% of market value for your house at auction. Also, the auctioneer to charge a commission of 2.5% of the hammer-price.
The reserve price at auction is what the seller sets. The auctioneer will not sell your property at below this price. But once the bids equal or go above the reserve, your house is guaranteed to sell once the hammer falls.
Be aware that the guide price is different to the reserve price. The guide price is simply the starting point for the auctioneer to create interest in your property.
Don’t use the Modern Method of Auction as these don’t work very well and are very expensive in the amount of commission charged.
Pros and cons of selling your house at auction
The pros of selling at auction:
- You get a house sale with completion in 28 days from the auction day.
- If your house sells on the day of the auction you are guaranteed the cash in 28 days.
The cons of selling at auction:
- Not a guaranteed sale.
- High commission of at least 2.5% of the final hammer price.
- There can be a delay waiting for the next auction day.
- You are at the mercy of the auction being busy on the day of the auction.
- Won’t work if you’re in negative equity.
5. Sell to a cash home buying company
You can expect to receive an offer of somewhere between 70-85% of market value if you sell your house to a cash house buying company.
But don’t get ripped off and be ware of the sharks and scammers. There are loads in this industry, as it’s not regulated by the government.
This is possibly one of the fastest ways to turn your house into cash. But choose your cash buying company carefully.
What are the pros and cons of using a cash home buying company?
The pros of using a cash house buying company:
- There are no agency fees to pay (or at least with the reputable cash buying companies there isn’t). But be aware if you are still in contract with your estate agent at the time. If you are you will still have to pay their fees if you sell using a house buying company.
- A guaranteed way to sell your house fast.
- Often times they will cover your legal fees.
The cons of selling with a cash home buying company:
- You may take a significant hit to the cash you receive of between 25-30% of market value.
- You need to be careful how you choose the cash home buying company to avoid time wasters, scammers or rogues.
- Won’t work if you’re in negative equity.
6. Sell your home on a lease option contract
Selling your home on a lease option is a good idea if you need to sell your house quickly, but only if the agreement is a win-win for you and the buyer.
Property lease options work particularly well in circumstances if you have little or no equity in your home. Alternatively they work if you don’t need all of your equity now, but still need to sell fast.
Some property industry experts say that selling your home on a lease option or being locked in to an option contract is a bad thing. But we think differently, as we are one of the leading experts in option contracts and lease options business.
However, you do need to be careful with who you are dealing with. There are many bad scam lease option companies, as there is with any industry. But as the lease options industry isn’t regulated, it’s too easy for scammers to get away with it. So choose your lease option company carefully.
Key points for selling your home on lease option:
- Lease options only work if the deal is a win win: Bowfin are only happy to buy a house on a lease option if it’s a win for the person selling their home or a landlord who’s selling their property portfolio. Otherwise the deal is a non-starter. But equally it must also be a win for Bowfin too.
- There should not be a hard-sell of the lease option contract: All negotiations to agree the main agreement terms of the lease option should be done at the seller’s pace. But if you are desperate to sell, the negotiation can be done as fast as is necessary. But always keeping in mind the win-win at all times.
- The lease option contract must be drawn up by specialist solicitors: Additionally, you must be separately legally represented during the contract process. Lease options are a legal agreement. Which means you need to understand what you are agreeing to with your home or property portfolio.
What are the pros and cons of selling your house on a lease option?
The pros of selling your house on a lease option:
- The sale can happen very quickly.
- You’ll receive a portion of your equity quickly.
- Lease options can be extremely flexible and can often be adapted to work with your circumstances.
- They work well if you don’t need all of your equity upfront.
- Lease options work well if your house is in negative equity.
- No estate agent fees to pay.
Cons of selling your house on a lease option:
- You only receive a portion of your equity at the start of the agreement.
- You are still the legal owner of the property. This means you could sign a lease option with a less than reputable company. This may leave you vulnerable to their lack of integrity.
7. Consider selling your house with the aid of an assisted house sale
Selling your house using an assisted house sale means that you get some of your equity right away.
You stand to gain more cash from the ultimate onward sale of your house. This is because the assisted house sale company has upgraded your house at their expense.
Assisted house sales work well in the following circumstances:
- Your house is in need of significant upgrade. But you lack the funds or knowledge to carry out the work yourself.
- You’ve just been granted probate on your parents home which needs to be renovated and is proving difficult to sell. This also works well if you don’t have the funds or the necessary expertise to do the work. Or possibly, your parents home is too far way from where you live.
- Your house has a potential upside with the option of planning permission to extend or transform into flats or similar. If you would like to be involved in a hands-off development. But at the same time reap the rewards from the uplift in value, this works particularly well. However, this only works if there is development potential for the property.
The benefit to an assisted sale company is there’s no Stamp Duty on the transaction between you and their company. This means there’s more profit in the deal to be split at the end of the project. Which ultimately benefits you as the seller.
If you are happy to wait for a delay in when you receive the bulk of the proceeds. But if you need some of the equity now, an assisted sale is a very good option for you.
But as with lease options, the only way an assisted sale works is if the agreement is drawn up as a win-win.
What are the pros and cons of selling your house on a lease option?
Pros of selling your house on a lease option:
- You get to sell your house quickly.
- There’s the opportunity to receive more cash from the assisted sale arrangement.
- No estate agent fees to pay.
The cons of selling your house on an assisted house sale:
- You have to wait for a portion of your equity.
More reading: Lease option vs assisted sale (What’s the difference?)
Do you want to sell your house fast for market value
If you want to sell your house fast for market value an assisted house sale is the perfect solution if you don’t need all your equity upfront.
If you’re prepared to wait for some of your equity with the opportunity for an enhanced sum, an assisted house sale will work to sell your house fast, whilst maximising cash.
Is selling your house to an investor a good idea?
Selling your house to an investor is only a good idea if the agreement reached between you and the investor is on a win-win basis.
If you need to sell your house quickly, by selling to an investor you’ll find they can offer flexible arrangements that may suit your circumstances when you’re struggling to find a buyer.
The reason why you’re struggling to find a buyer may for any number of reasons. But so long as you can come to an agreement with the investor about how the problem is dealt with, this becomes the win-win scenario.
An example of when it’s a good idea to sell your house to an investor:
For example, you may have Japanese Knotweed at your house, which might make it impossible for buyers to get a mortgage on your house.
Japanese Knotweed can be eradicated, but it takes time. This can be sorted out by the investor, whilst allowing you to move on to your new home. This is an example, of where a lease option works well because a mortgage isn’t required at the point the option contract is signed.
It’s only further down the road where the investor exercises their option to purchase your property when a mortgage may be required. But at this stage the knotweed should have been resolved. This would be what we describe as a win-win.
This will only be the case if you and the investor can agree on the following main terms of the agreement.
- The upfront payment of equity.
- The term of the lease option agreement.
- The final price to be paid for the property when the investor buys your property at the end of the option contract.
Can I refuse to sell my house to an investor?
You can always refuse to sell your house to an investor if the arrangement they offer you does not suit your needs or circumstances.
All agreements reached between investors and home owners need to work for both sides. But if it doesn’t work for you, say so and walk away from the deal.
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