Part-exchange - any experiences?

[Deleted User]

Hello,

One of our relatives is a marketing manager for one of the major homebuilders and has suggested to us that P/X could be a useful route for us wanting to sell our home.

My question is: has anyone else got any thoughts on P/X and is it worth doing?

We might have found a new development from these builders that we're interested in buying a plot from, so here's how it would work:

They get 2 or 3 independant valuations of our property and take the average of these.

They then offer us 98% of that value. They cover the HIPs and survey, amongst other things.

The condition is that you need to complete within 28 days of the offer.

From my perspective, it sounds like a good deal if you want to buy from them. They guarantee to buy our property, so we don't have the hassle and stress of finding a private buyer, and the 2% hit we take on P/X balances out the costs and fees we would otherwise have to pay.

Any thoughts?

LandyAndy

I did it 25 years ago and it worked very well.

That's probably not too much help now though.

Graham1979

I completed on what sounds a very similar deal at the end of November.

My experiences were very positive, got what I considered a very fair price for my flat (and they've actually sold it for £5k less than they gave me p/x), no selling agent fees, no HIP fees, and best of all no worrying about the chain collapsing.

The only negative that I can find with the process is that the developers will generally offer less discounts on the purchase price if there's p/x involved.

I'd definitely recommend the process based on my experience.

[Deleted User]

Graham1979 wrote: »

I completed on what sounds a very similar deal at the end of November.

My experiences were very positive, got what I considered a very fair price for my flat (and they've actually sold it for £5k less than they gave me p/x), no selling agent fees, no HIP fees, and best of all no worrying about the chain collapsing.

The only negative that I can find with the process is that the developers will generally offer less discounts on the purchase price if there's p/x involved.

I'd definitely recommend the process based on my experience.

Yes, that's what our relative told us too. Basically, whatever the 'cost' to them in the P/X will be taking out of their margin, so less for us to negotiate.

So, say the salesperson has a margin of £15k - you could haggle for granite surfaces, carpets etc...but if they do a P/X with a view to taking a £10k hit on it, then they'll only negotiate for £5k.

mark5

We done a part exchange in 2006 and agree with what Graham1979 says, we got given £5000 under what the estate agent valued the house at for us previously but saved the agent fees (£1500).
You will pay top money for the house your buying though which is the downside although everything will be new (plus point).

lovemotown

:TWorked a treat for us last summer - we put the deposit down and moved in 6 weeks later!

The builder has just sold my former home for the same price as they gave me which was an average of "to market price" and "price to sell quickly".

At first I thought it was a bit low but it took all the hassle out of it, and as the previous poster mentioned, no HIPS, no EA fees, got carpets, landscaped, burglar alarm, white goods, and a reduction of 2.5% off the price as well.

You will always wonder if you have paid too much on any house purchase, but the houses on our development keep on selling, (and very few left), and although I track the sold prices on the internet, they seem to be going through at no less than what we paid.

I guess location has to be factored into the price as well, and my new area is truly nice compared to where we lived, so it just makes it all the more palatable.

It is true to say that if you did a "normal" purchase outside of p/x, then yes, you probably would have more bargaining power, but I knew my house had already been reduced by over 25k since they were completed so was happy with a further 2.5%.

Another benefit that nobody mentions is that when you do a part ex, if you have a word with the builders rep, you can agree to complete and keep the keys over the weekend for both properties, (your solicitor will sort that out) which means you can move out at your leisure taking all the weekned if you like. This procedure has a name but I cannot remember what is known as.

By our moving, we have created a domino effect and our former neighbours are all getting jumpy and wanting to move but can't sell their houses the traditional way, so are stuck until they do.

There are a lot of scare stories out there on new builds, (and a lot probably true - so do your research on the builder), but the building regs have improved so much now, especially on stuff like noise, and efficiency. I am really chuffed with my new house, everything works as it should, clean straight walls and not a bit of wallpaper in sight, and is super duper efficient on heating, lighting etc. You have a blank canvas to make your mark. I also have quite a large garden for a new build although I accept that some/most plot sizes are getting smaller, as they cram on as many houses as they can.

My builder although national, is not mega big, and yes, some of the finishing is not great, paint smudges/runs, carpentry bit hit and miss, but you are going to get this now on most new builds as builders use contractors that haven't always served apprenticeships and don't have the old school site foremen who used to check quality control. I am 100% happy with the aftercare because as soon as I ring with a snagging job, they deal with it straight away.

This is a story of how this can work for you, (and how it worked for us),what you now have to consider is; "is this suitable for you"??!

[Deleted User]

That's great - thanks for your replies. We're quite fortunate in that my sister-in-law is the marketing manager for one of the big firms and her husband is the site manager on the development we're interested in, so at least we've got their word on the standards of the construction.

Next step for us is to get a private valuation of the property too just to ensure we have a range of opinions. P/X could be a good deal for us though as new build seems hassle-free (our current home was bought off-plan) and there seem to be some good offers out there.

Plus - like someone mentioned - you get all weekened to move, so not so much of a stressful experience!

[Deleted User]

We did this 10 years ago for convenience (we hated the thought of the selling process) and regretted it!

Our flat was valued at £34k and Wimpy offered us 34k. So far so good. However, as it turns out you have to agree to any viewings aranged by Wimpy so we had all the hassle but no control over the process. The £34k valuation (from three independent EA's) was clearly very low as we had people fighting over the property. They clearly thought it was very cheap. The people that finally bought planned to refurbish yet Wimpy insisted that we pay for checks on everything under the sun. The buyers said don't bother but Wimpy insisted that everything was done by the book.

The house was sold long before we were due to move into the new place. Had we done it ourselves there would have been a lot less cost and hassle and I'm certain we'd have got at least 5k more for it.

But nothing wrong with the process. We were just silly to use it when we had such an easy-to-sell place.

lovemotown

Deleted_User wrote: »

We did this 10 years ago for convenience (we hated the thought of the selling process) and regretted it!

Our flat was valued at £34k and Wimpy offered us 34k. So far so good. However, as it turns out you have to agree to any viewings aranged by Wimpy so we had all the hassle but no control over the process. The £34k valuation (from three independent EA's) was clearly very low as we had people fighting over the property. They clearly thought it was very cheap. The people that finally bought planned to refurbish yet Wimpy insisted that we pay for checks on everything under the sun. The buyers said don't bother but Wimpy insisted that everything was done by the book.

The house was sold long before we were due to move into the new place. Had we done it ourselves there would have been a lot less cost and hassle and I'm certain we'd have got at least 5k more for it.

But nothing wrong with the process. We were just silly to use it when we had such an easy-to-sell place.

Yes, you still have to show people round that the builder sends, (although ours were by appointment with the EA they had instructed to sell it for them) until you move, but you have to do that if you market the property yourself anyway.

It was kinda fun to show people round knowing that you were moving soon anyway and smug when they started offering silly offers and saying "it's not my house any more"! The look on their faces was a picture.

[Deleted User]

I understand that most firms will offer cashback if you show people round and help introduce a buyer too.

mark5

With us the builder went with the agent who had previously valued the house for us, the agent would phone us to arrange viewings to fit in with us.

We also kept the keys to the old house over the weekend so we didnt need to move everything on the day although we did.