Selling house to a friend - good or bad idea?

high_flying_bird

Hi

I'm in a situation where I need to sell my house, as I'm moving for a new job.

When asking friends for estate agent recommendations, one of them expressed an interest in actually buying it to rent out, and doing so privately to save on EA fees.

On the face of it this sounds like a great idea - save a bit of money, and get a quick no-chain sale (I will be renting for a bit). He seems pretty keen, and is coming for a viewing next week.

But... I'm not sure if it's a good idea. I don't usually like to mix business and friends just in case of disaster, and I'm worried I could miss out on a better offer via an agent.

Can I instruct the EA while making them aware that I already have a potential private buyer? Or should I just tell my friend to go via the agent if they want to make an offer?

thanks :beer:

NeilCr

Very difficult. I sold to my best friend - it worked out okay in the end but if he had been any other buyer I'd have kicked him into touch after a few months. He wasn't good at finding a buyer for his place

Funnily enough we were chatting about it earlier this week. I did one or two things as a seller which caused him issues too

From my experience I'd honestly not recommend it - fortunately our friendship survived!

G_M

high_flying_bird wrote: »

Hi

I'm in a situation where I need to sell my house, as I'm moving for a new job.

When asking friends for estate agent recommendations, one of them expressed an interest in actually buying it to rent out, and doing so privately to save on EA fees.

On the face of it this sounds like a great idea - save a bit of money, and get a quick no-chain sale (I will be renting for a bit). He seems pretty keen, and is coming for a viewing next week.

But... I'm not sure if it's a good idea. I don't usually like to mix business and friends just in case of disaster, and I'm worried I could miss out on a better offer via an agent.

Can I instruct the EA while making them aware that I already have a potential private buyer? Or should I just tell my friend to go via the agent if they want to make an offer?

thanks :beer:

What on earth is the point!?

You pay thousands to an EA, to find you a tenant you've already found, and benefit..... how?

You still sell to a friend, so any disagreement over price, the process, the subsequent condition of the property etc will still impact your friendship.

Either sell privately to your friend, or go to an EA and sell on the open market.

high_flying_bird

G_M wrote: »

You pay thousands to an EA, to find you a tenant you've already found, and benefit..... how?

You still sell to a friend, so any disagreement over price, the process, the subsequent condition of the property etc will still impact your friendship.

When you phrase it like that it's quite obviously a stupid idea! thanks

steampowered

A lot of EA contracts would make you liable for their fees if the house is sold while it is listed with that agent. This would be the case under any sole agency contract.

So if you did go down that route, you need to check the EA contract ... otherwise you'd still have to pay the EA fees even with a private sale.

xylophone

It might be an idea to pay for a RICS valuation.

If your friend is ready, willing and able to proceed (after due diligence of his own), it seems to me that you will be in a good position.

The friend wants to purchase as a buy to let so that there is no chain (which must be regarded as a bonus), and you have the dual advantage of no extended viewing palaver and no EA commission.

Money_maker

You could still use an EA for valuations without signing them up to ensure you get current market value.

zagubov

Money_maker wrote: »

You could still use an EA for valuations without signing them up to ensure you get current market value.

The only downside to not going through an estate agent might be that your mate's offer won't be the start of any hypothetical bidding war that might get you more money. But if you're comfortable with his offer, that's not something to dwell on.

AlexMac

The cynical thing to do would be to do as Money maker says; invite three local agents round to quote terms, fees and assess the value, then assume you'll sell at up to maybe 5% off their average...

... then just politely say "thanks but no thanks", or "I'll think about it" to the EAs while you establish if your friend will actually buy at that price less, say, half the likely fee.

In fact that's not really cynical; we always get three agents in to quote, so they are used to someone missing out on handling the sale. In our case, they each responded in a day or two, in writing, so if your local EAs are eqaully efficient, you'd have a bit of paper to wave at your mate.

The only glitch would come if their estimates varied widely, as ours did when we last sold. We went with the toppy one, as they actually had a buyer lined up and we had just waht they wanted (a dog- friendly garden flat). So even theough the buyer came in £10k under the asking price, we got 12-15% more than the lowest valuation! And it sold in days.

As least the lowest EA had the grace to admit "Oops, we got that wrong" when we popped in during our own subsequent house-hunting.

The other problem would be when the survey comes in; and your friendly matey buddy buyer turns into a Rottweiler and tries to negotiate you down on price, for the inevitable bit of damp/rot/dodgy electrics or plumbing as most buyers tend to do?

poppasmurf_bewdley

I sold my first house to my best friend and his wife. We agreed a price, they applied for and got the mortgage, as did we for our new home.

Everything went through smoothly within less than three months. A slight delay was on the part of our solicitor who wouldn't sign everything off until he had clarification of a boundary problem on our new property.

I'd do it again, no problem.