Buying an investment property is always done with profit in mind, and whilst rental income can contribute to this, the biggest pay out comes when you sell the property. So, how do you maximise what you can make?
Estate Agents
Employing an estate agent is traditionally the easiest way to find a buyer as these can help you get your property on the main websites whilst also conducting viewings on your behalf. They aim to achieve the highest possible price using a variety of methods.
A typical estate agent should have a presence in the local area and a substantial knowledge of the locale. Search for a similar property to your own on the property websites using the ‘sold subject to contract’ filter to see if one particular agent dominates these sales. There are also third party review sites which can recommend agents in your areas. This can be particularly useful if you are not based in the area and do not have the local knowledge needed to make an informed decision.
When you meet with an agent they should be able to detail their marketing plan for your property. This should outline which portals they intend to advertise on, whether they will be organising an open day and who they think they are likely to attract. As agents will usually charge between 1% and 3% of the purchase price, it is not necessarily the best choice to opt for the agent who gives you the highest valuation or the lowest fee. You need to ensure that your agent understands what you are trying to achieve and has a clear plan of how to achieve this.
If you currently have tenants in the property you may want to approach a lettings agent who can advise you of any investors looking to add to their portfolio.
In competition with these High Street agents are now a growing number of online agents who will sell your property using the main online portals. The levels of service from each one vary greatly and so do the costs, but these usually start around the £700 mark.
There are some sites that compare the fees of these online agents as well as their performances, and this can be useful information to have.
Some of these online agents now offer a very similar service to their High Street competitors whilst others give a more basic service that requires you to conduct your own viewings. Whilst the service can vary, one thing all of these online agents have in common is that they are a low cost alternative to the traditional routes to market as most offer a fixed fee.
Auctions
Auctions can be a quicker option when it comes to selling a house. The auction will be for a set fee and when the hammer falls, the house is sold. There is a typical misconception that property sold at auction goes for a much lower price than those sold through the estate agents but this is not always the case.
By speaking to the auctioneer you can establish how well similar properties have performed at auction and how much interest they have had. The catalogue listing and valuation for an auction property typically costs in the region of £400, and your property will be given a ‘guide price’ in the brochure. You can apply a ‘reserve price’ to your property which ensures that if your property does not achieve this price at auction, it will not be sold. As there is a chance that the property may not sell, you will need to have a plan of what to do should this occur.
Selling Sites
Once the domain of second-hand bric-a-brac, many online selling sites now cater for much higher value items as well, including property. These sites usually have a free listing option, but paying a small fee usually makes your listing more visible.
Before spending too much effort on time wasters who do not have deposits, mortgages or cash in place, do your research on anyone who contacts you. As you will have to conduct your own viewings this is a cheaper but more labour intensive option.
Private Sale
Should you wish to do it all your own way, you could simply put your own sign outside your property to advertise that it is for sale. This is a method that has crossed the Atlantic and is occurring more and more in the UK. Again, this will require you to spend quite a bit of time on any enquiries, so living close to the property is an advantage.
Quick Sale Companies
We have seen these types of companies offer to sell our cars for a while, and now they do it for houses too. These companies will give you a quick cash sale but it is likely that you will receive less than the market value. It is very important to ensure you deal with a reputable brand that can prove they are a genuine buyer with a solicitor’s letter.
There are no fees involved in this route, and a quick sale will minimise your outlay on mortgage payments and utilities while you wait for it to sell another way, but it is possible you would get a much higher value by holding out.
Social Media
Social media seems to be the key to everything these days, and it can help you to sell your house too. By setting up your own web page, you can then promote it through all forms of social media and reach a wide audience.
When selling investment property, make sure you advertise the right property in the right place. Get the correct value, not the highest and use good quality photographs that show your property in its best light. If you have tenants, speak to them first to ensure they keep the house ready for viewings and understand whether they can continue to live there after the sale.
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