As a property seller with multiple properties, you may have wondered whether it’s worth selling your house to a developer. Alternatively, you may have been approached by a property developer offering you a competitive price for your home.
There are pros and cons when it comes to selling your property to a developer. Read our guide below so that you’re informed before you make any decisions.
Advantages of selling your house to a developer
No property chain
When selling your house to a developer, you can save a lot of time because there isn’t a chain involved. If there are two houses in a chain, you have a 42% chance that one of the house sales will fall through at some stage in the process. This increases along with the number of properties involved in the chain. Property developers tend to be chain-free, so this means your sale should go through relatively quickly and easily.
A low-risk sale
Established property developers are relatively low-risk; they’re likely eager to complete the sale so they can move forward with their plans. They have the money and means to buy your home quickly. Whereas other buyers can pull out of the sale at any point before completion, and for many different reasons.
You could get a higher sale price
If a property developer makes you an offer, they’ll have a plan for your home or for the land that it’s on. If they have large plans for the local area, they may be willing to pay extra to secure your home, and this is an excellent way to make money from your property.
Before going into negotiations with a property developer, make sure you know the value of your home so you know the minimum price you should accept. There’s no guarantee that they’ll pay more than market value, but if they’re truly invested in their plans, you may be able to secure a great deal.
A fast sale
With more properties coming on the market, buyers have a lot more options, and this can slow down your house sale. Typically, it’s much faster and easier to sell to a property developer than to sell through the traditional route.
Avoid house viewings
When you sell to a developer, you avoid hosting house viewings or leaving the house so your estate agent can host them for you. You also avoid all the cleaning and tidying that has to be done before viewings.
No home improvements
Save time and money by not having to prepare your home for going on the market. Most people spend time repairing things, tidying paintwork, or clearing their gardens before marketing their home.
Property developers already know what they want to do with your home, so there’s no need to worry about improving it for the sale.
Disadvantages of selling your house to a developer
Whilst there are many advantages to selling your house to a developer, you need to be aware of the potential drawbacks too.
An emotional loss
If you’ve lived in your home for a long time, it can be difficult to sell it to a property developer. They may completely change your home, or they may even knock it down to rebuild something else.
Planning permission
Sometimes, property developers make an offer on your property that relies upon them getting planning permission for their development. This can slow down your house sale, or even worse, it could fall through completely if their planning permission application is rejected.
It could fall through
Sometimes the deal disappears for reasons that are outside your control. Your neighbours could pull out of the deal, which would mean that the development isn’t viable anymore. This is especially true if a neighbour’s house is on a plot of land that gives access to the site.
A potentially lower sale price
Property developers want to make as much profit as possible. If your home is one option out of many, they won’t need to make you a competitive offer for it.
They’ll choose to move forward with the most cost-effective property for them, so if you don’t agree to a price that makes them a good profit, they could move on quickly.
Lack of support
When selling a house to a property developer, you don’t have the buffer of an estate agent. Developers can be quite intense; they can send a lot of emails and make a lot of calls when trying to convince you to sell your home.
As well as this, property developers are always trying to maximise their profits, which means that you can’t be sure they have your best interests at heart. When you sell through an estate agent, you have constant support and someone to act on your behalf to negotiate the best deal possible for you.
Will a developer pay more for my house?
Whether a developer will pay more for your house or not depends on how crucial your home is to their plans. If your property is needed to complete a wider development, then they could offer you a price that’s higher than its market value. However, if your home is one of many that they could use, then they’ll have little incentive to drive up your offer.
If you’re considering selling your house to a developer, then the best place to start is to find out how to value your home. Gather all the information you can so that you’re fully informed when going into negotiations.
Contact us if you have any questions about selling your home or to get an up-to-date property valuation. We’ll provide you with expert advice about how to move forward, with no obligation to take up our services.
