Homesellers lose thousands with quicksale firms
Filed under: House Prices
These firms have mushroomed in size recently and target homeowners who need to sell up fast, offering them quick cash in return for their home.
Mortgage Advice & Info
Why choose a quicksale firm?
Any seller that has experienced the frustration of a slow property market knows how appealing the prospect of getting the sale done and dusted in a matter of days is.
Quicksale firms will give you a quote for your home usually within the day, and they can have the whole process completed in less than a week – with the cash in your bank account.
You don't need to repaint, declutter, and tidy up. You don't have to pay expensive estate agent fees, and you don't have to spend time worrying that nobody wants to make an offer on your home.
Buying and selling property is often cited as one of the most stressful experiences we can go through, and it can take months.
According to research from property website home.co.uk the time taken to sell a house has risen by over 50% in the last five years, from an average of 75 days in 2007, to 154 days today.
The type of house you are selling will also affect the time it takes you to flog it. A detached house currently takes on average 178 days to sell compared with 141 days for a terraced house.
And, of course, it depends whereabouts you live in the country. Homes in Newcastle take a lengthy 265 days to sell, compared with just 129 days in Brighton.
So it's little wonder more of us are opting to let a quicksale firm buy our home in a jiffy.
Who do they suit?
Quicksale firms target those vendors who not only want to sell quickly (don't we all?), but in many cases need to achieve a quick sale.
These are primarily those with money worries, including homeowners who are facing repossession. If you have decent equity in your property, a swift and easy way out of serious financial problems is to sell up, pay off the mortgage and the arrears, and wipe the slate clean.
Other prime targets for quicksale firms are divorcees, who want a quick settlement and to move on with their lives, rather than a drawn out sales process that may involve them having to carry on living together.
Bereaved families selling a home that has been left to them also often turn to quicksale providers, as well as those who are in a property chain that is at risk of falling through.
But while these are the main targets of quicksale firms, they are increasingly being used by sellers who simply want to offload their property quickly without facing today's challenging property market.
Quicksale firms clearly offer a tempting service to, often vulnerable, sellers who need to flog their home quickly, but they may not be the best option for those who need to maximise the return on their home.
Indeed, Confused.com is urging vendors to beware quicksale companies, claiming that they offer up to 25% less than a property's real market value, which could amount to tens of thousands of pounds of an achievable sale price.
In undercover research, Confused.com found that one house valued at £266,000 was offered to be bought for just £199,500 by a quicksale company, meaning the seller would have missed out on a whopping £66,500.
Mhairi Duffin, head of mortgages at Confused.com, says "Taking this drastic method of selling your property may offer a speedy way of releasing some much needed cash, but there are some serious implications to be made aware of."
"You could be losing thousands of pounds off the market value of your property!"
It is worth checking out other avenues before rushing to a quicksale firm, and a traditional estate agent is one such alternative option.
Tim Gray, spokesperson for Paramount Properties, an estate agent in London's West Hampstead believes you don't need to resort to a quicksale firm to sell quickly.
"Traditional agents can identify suitable buyers and know who is in a position to act quickly; they can offer you more than one option of buyer, leading to competition for the property and an increased price," he says.
"Running our open day service I know that it is achievable to get 25+ viewings in one morning alone, and 80% of properties receive an acceptable offer on the day. On average we achieve offers at 98-100% of asking prices within three days of the open day, a much better price than what a quicksale firm will offer."
Of course you could also put your property up for auction if you have to move quickly. And if you are considering selling because of mortgage arrears, make sure you explore all possibilities with your mortgage lender first. They will usually work with you to help you get back on track.
Duffin says: "Contact your mortgage lender to work out a plan of action that can help you get back on track and avoid repossession, rather than irrationally selling your home and losing one of your most important worldly assets."