Curiosity killed the cat - but satisfaction brought it back.

SilasMarner

Afternoon. This is a "help me understand" post. Our house is on the market. It's a usual big box detached, clean bright and O.K in a type of 1990's way. One of zillions, I guess. Anyway - a letter from "National Homebuyers" drops through the letter box offering a cash deal. Obviously picked up from Right Move and addressed to "The occupier". I presume the offer, if I dared to contact them, would be somewhat minimal. I heard of offers being reduced at the last minute and other "strategies". But how do they run their business model? They must send hundreds of letters out? Who are they and how are they funded etc? Just wandering down the "cor blimey" route and wondering.  Thanks for reading this.

Brie

I expect there's either a clever IT programme that looks at what's on Right Move etc and generates a letter on the off chance at minimal cost and time to anyone.  Should 1 out of 100 or 1000 letters get a nibble then a person would take over and send out an offer maybe 30 to 50% or more below the asking price.  If this gets anything like a positive response then things proceed and the seller would sign a contract which, I'm guessing, would mean that they have agree to cover all the costs of the sale.  Meanwhile NHs would be seeing what they could quickly sell the house for - maybe 80% of your asking price?  It still means that with a minimum effort they could easily get a huge hunk of money by flipping the house as quickly as possible. I wonder if they ever actually own it themselves (thus avoiding CGT) but word the contract so they are just acting as a pimp broker for the sale.

user1977

The business model is to sell it on quickly (but not quite as desperately as the original vendor) and pick up the difference between the two prices (which needs to be a fair chunk to cover the costs and risk). That's it.

warwick2001

IIRC (I looked into this a few years back as I needed to sell quick), the company don't actually buy the house from you, they just market it on your behalf, for a much lower price than you could get in the open market (my house was valued at £120k, they offered to 'buy' it for £89k). I was told by the salesman that they have a vast buyer register constantly looking for houses, and my house would be sold within a week. However, after a bit more digging, the usual time for these sales to complete is approx. 4 - 6 months (so, just the normal sale timescales), and like other posters have said, they will very likely change the offer close to completion, and as the seller has usually mentally agreed/is desperate to sell at this point, they tend to accept the lower offer. 

Basically, the general advice is, unless you are absolutely desperate to sell, and are willing to accept approx. 70% of the actual value of the house, avoid at all costs!!!! I decided not to go down this route, and left it on the open market. It sold about 6 months later for £122k, so had I not pulled out, I would have been £33k worse off. 

Jonboy_1984

I suspect Rightmove and Zoopla sell the data on new listings, we had letters from these, 2 others, and a local estate agent within around 4 days of listing last year.

A few weeks later "the occupier" also got discount offers from Curry's for that essential CCTV to make your new home feel secure, and Wayfair to furnish it (both offers expired 6 weeks before completion.....!)

SilasMarner

Thank you for your knowledgeable and pragmatic answers. Live and learn! Avoid at all costs then. Mind you the whole selling process is fraught with tripe. My local E.A. made statements that would frighten the average polygraph. Hey Ho! Onward. Thanks once again.

GaleSF63

I'm surprised they send letters to new sellers because they'd surely be more likely to get a bite from sellers whose property has been on the market for a while without much interest. 

Jonboy_1984

GaleSF63 said:

I'm surprised they send letters to new sellers because they'd surely be more likely to get a bite from sellers whose property has been on the market for a while without much interest. 

That was the real laugh with the two letters we had from the same estate agent, they arrived together within 72 hours of the listing going live and started along the lines of "are you dissatisfied with your current agent?" 

daivid

Have you asked the neighbours if they’ve had one? A while back the whole estate I'm on were sent letters like yours twice (around a month apart). No real logic, just a brute force approach, if they send enough they'll get someone interested and make enough to cover thousands of letters. Houses on the estate were and still are selling in 2 weeks to a month so hardly a prime hunting ground for such companies either.