Cash buying companies

kb1956

UPDATE.........I have decided to go down the estate agent route and hope for a quick sale. Thank you everyone for your comments I will ask admin to turn commenting off 🙂............I have read all the warnings on here about avoiding these types of companies however for reasons which I don't want to go into on here I need to sell my property quickly. I know these companies usually offer around 80% of the market value and I am resigned to that. I also have read reviews where some companies offer a further reduction at the last minute. I have recently been speaking to two companies Webuyanyhome.com and The Property Buying Company who have both assured me that once a price has been agreed and after my property has been independently valued they will NOT decrease the offer any further. I've also read good and bad reviews on Trustpilot but I'm aware that you can't always trust online reviews. Surely there is someone on this forum who has had a positive experience and willing to share their story. Thank you 

ReadingTim

If you're read all the warnings, why haven't you also read about the suggested alternative, which is just selling it via regular auction?  

I appreciate that people are far more likely to leave a negative review than a positive review, but surely the fact that the reviews for these sort of outfits are universally negative tells you something...?!?

eddddy

Before doing business with them, do you fully understand their business model?

(For example, house buying companies don't usually have any money for buying houses themselves. So they have to find somebody to sell the house to, before they can buy it.)

And you should definitely show any agreements to a solicitor before signing them.

MeteredOut

kb1956 said:

I have read all the warnings on here about avoiding these types of companies however for reasons which I don't want to go into on here I need to sell my property quickly. I know these companies usually offer around 80% of the market value and I am resigned to that. I also have read reviews where some companies offer a further reduction at the last minute. I have recently been speaking to two companies Webuyanyhome.com and The Property Buying Company who have both assured me that once a price has been agreed and after my property has been independently valued they will NOT decrease the offer any further. I've also read good and bad reviews on Trustpilot but I'm aware that you can't always trust online reviews. Surely there is someone on this forum who has had a positive experience and willing to share their story. Thank you 

Have you asked for a copy of the contract you would have to sign, to ensure that assurance is in writing?

eddddy

MeteredOut said:

Have you asked for a copy of the contract you would have to sign, to ensure that assurance is in writing?

With many / most house buying companies, it's more complicated than that.

For example, the house owner will often be required to sign a 6 month option agreement stating the fixed price.

So if you really want to go down that route, it's more important to negotiate the option period down from 6 months, to maybe 14 days.




The backround is often like this:

Typically, the house buying company don't have any money to buy houses with.

When they say "We will buy your house", they mean (using some example numbers)...

• "You sign a contract giving us exclusive rights for 6 months to buy your house from you for £240k" 
• "Then we will start to look for a buyer who is prepared to pay £300k"
• "If we find a buyer, we will do a same day 'back-to-back' transaction"
• i.e. On a specific day (e.g. 15th April) the buyer will pay us £300k for the house, and we will pay you £240k

So the problems include...

If they can't find a buyer, you're stuck for 6 months unable to sell to anybody else

That's when the pressure to reduce your price kicks-in. In simple terms, they might say something like...

"You can either volunteer to accept a reduced offer of £200k instead of £240k, otherwise you'll have to wait 6 months to sell"

MeteredOut

eddddy said:

MeteredOut said:

Have you asked for a copy of the contract you would have to sign, to ensure that assurance is in writing?

With many / most house buying companies, it's more complicated than that.

For example, the house owner will often be required to sign a 6 month option agreement stating the fixed price.

So if you really want to go down that route, it's more important to negotiate the option period down from 6 months, to maybe 14 days.




The backround is often like this:

Typically, the house buying company don't have any money to buy houses with.

When they say "We will buy your house", they mean (using some example numbers)...

• "You sign a contract giving us exclusive rights for 6 months to buy your house from you for £240k" 
• "Then we will start to look for a buyer who is prepared to pay £300k"
• "If we find a buyer, we will do a same day 'back-to-back' transaction"
• i.e. On a specific day (e.g. 15th April) the buyer will pay us £300k for the house, and we will pay you £240k

So the problems include...

If they can't find a buyer, you're stuck for 6 months unable to sell to anybody else

That's when the pressure to reduce your price kicks-in. In simple terms, they might say something like...

"You can either volunteer to accept a reduced offer of £200k instead of £240k, otherwise you'll have to wait 6 months to sell"

I know, which is why i suggested the OP asked for the contract. With that, they'll soon find out that the assurance, in real world terms, is anything but.

poseidon1

kb1956 said:

I have read all the warnings on here about avoiding these types of companies however for reasons which I don't want to go into on here I need to sell my property quickly. I know these companies usually offer around 80% of the market value and I am resigned to that. I also have read reviews where some companies offer a further reduction at the last minute. I have recently been speaking to two companies Webuyanyhome.com and The Property Buying Company who have both assured me that once a price has been agreed and after my property has been independently valued they will NOT decrease the offer any further. I've also read good and bad reviews on Trustpilot but I'm aware that you can't always trust online reviews. Surely there is someone on this forum who has had a positive experience and willing to share their story. Thank you 

I have a positive story of dealing with such a company.

After ignoring letters they wrote direct to me for a number years offering to buy my London property, they eventually tracked me down at work and made a direct approach on the phone. At that point and respecting their persistence, I agreed a meeting to discuss price. 

To be noted I was no longer living there, the house was in a dilapidated unmodernised  condition but I had been too busy with work to get round to selling.

I set my price based on comparatives on the street and immediate environs. Predictably they tried to offer around 10% less for a fast sale. In the end I agreed to knock off  £4,000  from my price for a notional saving on Estate Agents fees. However to be clear the property was in a desirable sought after part of London and not withstanding its condition would have sold reasonable easily via conventional route. 

However I benefited from pretty much the full asking price ( given its condition). They eventually did a flat conversion in order to make their realistic profit margin. 

Their professionalism was such that I referred them to a relative who had similarly 'abandoned' their desirable  London house, and with my help, agreed a selling price that was well in excess of  what the relative thought it was worth.

However I stress that these positive outcomes arose from the desirability of the properties  concerned (and their location),  a fact we were fully aware of and exploited accordingly. Also helped that we had vacated the respective properties and were in no rush or pressure to sell, so strong negotiating positions.

I am aware that many of the other companies out there are unprincipled 'chancers' and largely to be avoided if you are not going to find yourself significantly short changed. Your circumstances suggest you are not in a strong position, especially if you approached them rather than (as in my case) the other way around.

martindow

poseidon1 said:

kb1956 said:

I have read all the warnings on here about avoiding these types of companies however for reasons which I don't want to go into on here I need to sell my property quickly. I know these companies usually offer around 80% of the market value and I am resigned to that. I also have read reviews where some companies offer a further reduction at the last minute. I have recently been speaking to two companies Webuyanyhome.com and The Property Buying Company who have both assured me that once a price has been agreed and after my property has been independently valued they will NOT decrease the offer any further. I've also read good and bad reviews on Trustpilot but I'm aware that you can't always trust online reviews. Surely there is someone on this forum who has had a positive experience and willing to share their story. Thank you 

I have a positive story of dealing with such a company.

After ignoring letters they wrote direct to me for a number years offering to buy my London property, they eventually tracked me down at work and made a direct approach on the phone. At that point and respecting their persistence, I agreed a meeting to discuss price. 

To be noted I was no longer living there, the house was in a dilapidated unmodernised  condition but I had been too busy with work to get round to selling.

I set my price based on comparatives on the street and immediate environs. Predictably they tried to offer around 10% less for a fast sale. In the end I agreed to knock off  £4,000  from my price for a notional saving on Estate Agents fees. However to be clear the property was in a desirable sought after part of London and not withstanding its condition would have sold reasonable easily via conventional route. 

However I benefited from pretty much the full asking price ( given its condition). They eventually did a flat conversion in order to make their realistic profit margin. 

Their professionalism was such that I referred them to a relative who had similarly 'abandoned' their desirable  London house, and with my help, agreed a selling price that was well in excess of  what the relative thought it was worth.

However I stress that these positive outcomes arose from the desirability of the properties  concerned (and their location),  a fact we were fully aware of and exploited accordingly. Also helped that we had vacated the respective properties and were in no rush or pressure to sell, so strong negotiating positions.

I am aware that many of the other companies out there are unprincipled 'chancers' and largely to be avoided if you are not going to find yourself significantly short changed. Your circumstances suggest you are not in a strong position, especially if you approached them rather than (as in my case) the other way around.

Your situation seems different in that you appear to have sold to a developer who contacted you.  They had cash to buy your house, renovate it and resell.  They presumably are on the lookout for delapidated or abandoned houses in areas where they are confident there is scope to make a profit.

poseidon1

martindow said:

poseidon1 said:

kb1956 said:

I have read all the warnings on here about avoiding these types of companies however for reasons which I don't want to go into on here I need to sell my property quickly. I know these companies usually offer around 80% of the market value and I am resigned to that. I also have read reviews where some companies offer a further reduction at the last minute. I have recently been speaking to two companies Webuyanyhome.com and The Property Buying Company who have both assured me that once a price has been agreed and after my property has been independently valued they will NOT decrease the offer any further. I've also read good and bad reviews on Trustpilot but I'm aware that you can't always trust online reviews. Surely there is someone on this forum who has had a positive experience and willing to share their story. Thank you 

I have a positive story of dealing with such a company.

After ignoring letters they wrote direct to me for a number years offering to buy my London property, they eventually tracked me down at work and made a direct approach on the phone. At that point and respecting their persistence, I agreed a meeting to discuss price. 

To be noted I was no longer living there, the house was in a dilapidated unmodernised  condition but I had been too busy with work to get round to selling.

I set my price based on comparatives on the street and immediate environs. Predictably they tried to offer around 10% less for a fast sale. In the end I agreed to knock off  £4,000  from my price for a notional saving on Estate Agents fees. However to be clear the property was in a desirable sought after part of London and not withstanding its condition would have sold reasonable easily via conventional route. 

However I benefited from pretty much the full asking price ( given its condition). They eventually did a flat conversion in order to make their realistic profit margin. 

Their professionalism was such that I referred them to a relative who had similarly 'abandoned' their desirable  London house, and with my help, agreed a selling price that was well in excess of  what the relative thought it was worth.

However I stress that these positive outcomes arose from the desirability of the properties  concerned (and their location),  a fact we were fully aware of and exploited accordingly. Also helped that we had vacated the respective properties and were in no rush or pressure to sell, so strong negotiating positions.

I am aware that many of the other companies out there are unprincipled 'chancers' and largely to be avoided if you are not going to find yourself significantly short changed. Your circumstances suggest you are not in a strong position, especially if you approached them rather than (as in my case) the other way around.

Your situation seems different in that you appear to have sold to a developer who contacted you.  They had cash to buy your house, renovate it and resell.  They presumably are on the lookout for delapidated or abandoned houses in areas where they are confident there is scope to make a profit.

Yes I did say my circumstances and that of the relative were different, however the OP did ask for someone who has had a positive experience.

 I do get that the OPs parameters does not permit the same level of negotiating  strength and that their property may possibly lack the desirability factor - I was merely illustrating that amongst the unprincipled rogues there are the occasional 'kosher' businesses in this sector. 

Herzlos

I suspect the folk who bought your house was a developer looking for run down houses to do themselves and not a general 'we buy any house' set up who needs to find a buyer.

We've got one of those posting on our community facebook page every few days looking for places to flip.


@OP - If you're resigned to getting 80% of market value, then why not just list it with a local estate agent with a fixed price of 85% market value and let yourself be haggled down to 80%? It's not likely to take much longer than using a company but you'll get more money from it.

poseidon1

Herzlos said:

I suspect the folk who bought your house was a developer looking for run down houses to do themselves and not a general 'we buy any house' set up who needs to find a buyer.

We've got one of those posting on our community facebook page every few days looking for places to flip.


@OP - If you're resigned to getting 80% of market value, then why not just list it with a local estate agent with a fixed price of 85% market value and let yourself be haggled down to 80%? It's not likely to take much longer than using a company but you'll get more money from it.

They did in fact operate nationwide (as a series of SPV limited companies), had a consortium of private investors providing a regular flow of development finance and specialised in converting houses to flats in desirable sought after areas.

They paid 1% commissions to people who spotted dilapidated properties in their local areas if those turned into purchases, and even gave away £100 M&S vouchers for  quality referrals from members of the public even if no sale was eventually forthcoming, so a pretty slick operation.

So pretty picky what they would buy, but if it fitted their business model they did'nt mess around which I appreciated at the time.