House buying companies have become more and more popular in recent years. According to the national charity, Shelter, at the end of September 2013, there were more than 195,000 mortgages in the UK, which were more than three months in arrears. This statistic is alarming, and it highlights and important fact that people who need to sell their properties fast due to financial reasons require more flexibility in how they choose to sell. As a result, house buying companies offer viable options for such people.
When people think to sell their properties they will often first speak with an estate agent to get an idea of what their property is worth, and how long it will take them to sell their property. An article in the Landlord Blog explains why you should sometimes be cautious when selling a property through an estate agent. The article, entitled, ’15 Reasons Why Estate Agents Are Idiots’ cautions sellers about choosing the wrong estate agent. I think the article raises some good points and suggestions in order to decide whether to go with an estate agent or a house buying company.
Here are some pros and cons of selling through an estate agent
- The agents will show your house to potential buyers, and negotiate on your behalf.
- Estate agents can give you advice and guidance to set your sale price.
- The estate agent can give you tips on any necessary renovations or changes to your home to get the best price.
- There have been reports that some agents do not pass on all offers to the seller because they are holding out for a higher offer – which would mean a higher commission for them.
- There is a serious risk of purchase breakdown if the agent does not verify that a potential buyer has the necessary deposit funds and a mortgage offer.
- There have been cases where estate agents have down-valued properties in order to sell cheaply to family and friends. When selling to a house buying company you are guaranteed something like this would not happen because the house buying company are the end purchaser of the property.
When reviewing the risks of dealing with estate agents it is no wonder why house-buying companies are becoming more and more popular.
Benefits of house buying companies:
- Avoid the headache of multiple viewings. Most house buying companies will make you an offer once they have seen the property.
- Constant communication. House buying companies purchase property direct from the seller. For this reason, there is less likelihood of communication breakdown, as there is no middleman.
- No bidding wars. Often times, properties sold by estate agents can result in bidding wars. This may sound good for buyers, but often times, bidding wars put off buyers who want a more certain purchase. House buying companies agree a sale price from the outset, and this price never changes. Therefore, there is no risk of bidding wars.
- House buying companies can act a lot faster. One reason is that they are dealing directly with the seller. As a result, the seller and the house buying company can address any concerns about the sale as required.
At the end of the day, it is up to the buyer whether they chose to sell their property through an estate agent or directly to a house buying company. However, it is important to remember that each decision is made on a case by case basis, and we always encourage our clients to shop around before agreeing to a sale price.