Selling property - do the work or reduce the price?

ajazztune

Hello
I am selling my flat (in north-east of Scotland) which has been valued at £145k. Some areas of work came up in the Home Report, including damp, new boiler, re-wiring and general upgrading all round.
We started off marketing it at OO £139k and nothing, then reduce it to £135k and nothing, now it's on at £125k and still nothing. There aer tenants currently living in it and they have alot of stuff and probably don't keep the place as tidy as they could. Unfortunately I don't live in the same city as the flat, so I have no control over how tidy it is when viewings take place. There have been plenty of viewings, and the majority of the feedback is "too much work required".

I reduced the price for a quick sale and was prepared to take the loss so that we could start looking for our next home quicker. But now I'm thinking is it worth taking such a huge loss when the work required isn't going to cost £20k? (I know this because I am currently getting quotes for the work and it is coming in for about half of that).

The flat is in a really desirable area near uni and there have been lots of viewings, just not that elusive offer.

So my question is: Should I remortgage the flat (the current mortgage is tiny) to do the work, then re-market it without tenants? (we'll have to cover the rent and pay an early redemption penalty if it sells)
OR
Wait it out at the current price?
OR
Reduce the price further?

Has anyone been in this situation themselves and what did you do?

I keep reading that doing work makes no difference to the price, but surely it makes it more likely that you will get the asking price and not take a loss?

Better_Days

I suspect a big part of your problem is trying to sell with tenants still there. It creates a lot of uncertainty for any potential buyer, mainly will there will be significant delays whilst you obtain vacant posession?

This on top of the work needed will not make your property fly off the shelf.

Suggest you get the tenants out, then re-assess whether it will be worth doing the work or selling the flat as it is.

Better_Days

ajazztune wrote: »

I keep reading that doing work makes no difference to the price, but surely it makes it more likely that you will get the asking price and not take a loss?

Just to add there is a difference between doing work that adds value and work that makes a property more saleable. Where the line between the two lies depends a lot on the current state of the market and who your target buyers are.

JimmyTheWig

In general I'd say it's not worth doing the work unless it is something that you can do yourself.
Whatever you get done, the buyer could have got done themselves for the same cost (or cheaper if _they_ are able to do it themselves) and then they end up with the solution they want.
You could, for example, replace the carpets throughout. Then a buyer comes along who wants laminate flooring.

But if the property is looking like too much work (i.e. too much hassle to fix rather than too much money to fix) then I think it may well be worth doing.

The other things that are worth doing are the cheap, quick things that make a big difference to the first impression. E.g. painting the walls of the rooms.

moneyshoe

I had a flat in Aberdeen when I was a student. Rented it out in my final year of uni as I was away so much and then tried to sell. I never got anywhere while the tenants were in - the flat was a tip every time I visited.

I think the most important thing is to get rid of the tenants then clean the place up, if you have quotes in place for the work then make those accessible to the viewers. I would find an attractive looking place that needed a bit of work much less of a problem than a dingy student flat with in-situ tenants needing work. If you think you are aiming at the student market then you may struggle to sell now as the term is about to start and most students have found their accommodation for the year. So maybe you should do the work and put it back on next Easter when the students/ mums and dads will be looking to buy.

PasturesNew

Even if you were living next door you wouldn't be able to dictate how tidy a tenant keeps the home they're paying for.

If you want it tidy, you can only do that once they've left, unless you give them big financial incentives to tidy it before each viewing.

Slinky

You're trying to sell their home. Where's their incentive to help you do that by making it tidy? I agree with the get the tenants out then reassess option when hopefully you as well as prosepective purchasers will be able to see 'the wood from the trees'.

Dan-Dan

Nice to read that you kept the place in good nick for your tenants

GwylimT

Unless newly done most reports will mention older wiring and old boiler, none are really an issue, very few homes have up to date wiring and homes have a wide range of boilers age wise. The wiring in my last house was mentioned, it was ten years old, perfectly safe, nothing at all wrong with it, just not up to date with current legislation which applies to current electrical work.

Damp, now I think this would put a lot of buyers off, especially as it is a flat, you need to look into this, is the damp definitely an issue with your flat, or is due to a problem in another flat?

I would not buy a property if me moving in depended on whether or not the tenants would move out. I would get rid of the tenants, give the flat a good deep clean and make it look more presentable.

So getting the walls into a good state if there are scuffs, paint everything magnolia, yes its plain and boring, but its bright and clean and gives the illusions of more spacious and lighter rooms and its easier to put your own mark on it. If the oven is fitted clean it, theres nothing like opening an oven on a viewing and realising it needs replacing as it has a range of black mountains on the bottom. If you have carpets have good look, do they look quite new or do they need a good shampooing. In the bathroom, things like ensuring there isn't any mold or stained mastic.

ajazztune

JimmyTheWig: Thanks. How do I know if its the inconvenience or the cost that is the biggest issue? I think at the price it is at, it must be a hassle thing, because the work wouldn't be an astronomical amount (though I realise the fact that it needs work limits the market somewhat). My estate agent indicated that ready to move in flats are flying off the shelves, so maybe people don't want the hassle even if they can afford it?

JimmyTheWig

ajazztune wrote: »

JimmyTheWig: Thanks. How do I know if its the inconvenience or the cost that is the biggest issue?

I'd say talk to the estate agents, as the first port of call.
While I wouldn't necessarily believe anything they say, they should know the local market.