Unfairly stigmatised as taking advantage of vulnerable homeowners, Ruban Selvanayagam of fast home sale specialists Property Solvers argues how firms operating in the space deserve less criticism.
Coming under various commercial labels, the role of the ‘sell house fast’ firm is essentially to help vendors achieve a swifter solution relative to what’s possible on the open market.
The reasons why people choose to approach companies like ours are wide and varied.
Some simply want to avoid using estate agents and auction houses. Perhaps there are tenants ‘in situ’, it’s an unwanted inherited property or there’s another reason to keep the sale private.
Others may need access to the equity within a short timeframe or require immediate funds to secure their position in another house chain purchase or business transaction.
Often, we find that the property is in major disrepair and the owner doesn’t have the time, money or inclination to deal with it themselves.
Where’s the catch?
Arguably, the main objection to the work we do is the value at which properties are bought at.
Our typical purchase prices lie in the region of 75 to 80% of the market value which, at first glance, seems a hefty chunk of equity for vendors to lose.
However, it’s worth objectively exploring some of the reasoning behind the model.
Firstly, there’s the speed at which we buy homes. Clients sell their properties to us in as little as 7 days. We don’t rely on long, drawn-out finance sources and can guarantee the sale.
As we take on properties in any condition (regardless of the situation), we must factor in the costs of works to bring the property back to a habitable state and make an industry-standard profit. Buying a substandard house for its full market (resale) value would not make logical sense.
We also buy houses, flats and buildings with underlying legal issues such as short leases, negative easements, restrictive covenants and other third-party consents.
We’ll pay all the legal fees and, as a direct sale, there are no pre or post completion estate agency costs.
On this note, there will be none of the hassles that come with an open market sale (time-wasted viewings, for sale boards, conveyancing delays).
All the ongoing homeownership overheads (mortgage, insurance costs, bills etc.) are also cut off within a much shorter time period.
An important fact…
Interestingly, some of our main critics are estate agents and auction houses.
Yet we would argue that any claim that we are ‘fleecing’ homeowners by these segments of the industry should fall on deaf ears considering that discounted sales happen daily on the open market.
Professional investors attend auctions to purchase property in the same manner as we do. We are, indeed, all singing from the same hymn sheet.
Learning from our mistakes
This is not to let the sell house fast sector completely off the hook.
Of course, it would be futile to state that we’re not out to earn a profit. However, taking advantage of vendors in vulnerable situations is not something any decent firm should be doing.
Yet, sadly, the reputation the sector has been tainted by a handful of unscrupulous operators.
For instance, there have been reported incidences of ‘gazundering’ – where a quick house buyer premeditatively drops the purchase price at the last minute, typically at the point of contractual exchange. Bar scenarios where the vendor has acted in bad faith (not disclosing crucial information at the start of the process), such behaviour is clearly inexcusable.
In other situations, homeowners are duped and even defrauded. Such practices have rightfully led to criminal convictions. Ask Susan gives an 8 point buyers check list which is really useful.
Any firm in our space that behaves in such manner is unlikely to last for long – especially given the greater level of scrutiny that bodies like the Office of Fair Trading (OFT) and The Property Ombudsman (TPOS) are adopting.
The National Association of Property Buyers (NAPB) was also formed as an independent organisation which most reputable fast companies in the space join up to (see our interview with co-founder Jonathan Rolande in a previous article we wrote for Just Do Property).
Treating vendors fairly
Professional sell house fast companies should be exploring all the vendor’s real options.
In many of the cases we deal with at Property Solvers, we advise clients to adjust the asking price. This usually gets things moving without people needing to use our service.
We also have our own estate agency where we focus on achieving vendors full market value offers in 28 days (the whole sale process usually takes between 2 and 3 months).
Swapping agents, adjusting the mortgage terms or using some kind of bridging loan have all proven to be workable solutions (depending on the circumstances).
Where clients do decide to move ahead with a fast sale, Property Solvers offer an entirely transparent service. We can complete sales in just 7 days where needed with no fees whatsoever.
We will also never drop the price at the last minute. If, during the conveyancing process, in the rare occurrence that any unnotified issue should appear, we give the vendor ample time to seek out another buyer or explore other solutions.
In conclusion, whilst the sell house fast sector certainly needs to improve its public image, it shouldn’t be immediately dismissed. It’s a completely legitimate way for people to dispose of their properties in the simplest of ways.