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In theory, as soon as you own a home you can sell it. However in practice it’s not always that simple. Not only could your home be more difficult to sell, it’s a costly process to undertake so soon after the expense of buying the property. Here we take a look at some things to consider.
One easy resolution is to sell to us. We buy homes of all shapes, sizes and values from our own cash funds. That means you’re not reliant on other people to sell their homes or arrange a mortgage. We also move fast and can buy your property in just seven days.
There are lots of reasons you might want to sell a house soon after buying it. If you are a property developer, it may only take you a couple of months to complete renovations. You’ll want to quickly make a profit and move on to the next project.
In many cases, an unforeseen event will trigger the need to sell. For example, a job loss or divorce could make a new home unaffordable. Or you may have inherited a home which you’re keen to sell on as soon as possible.
Before you sell a home you have to be able to prove you own it. Which can take a little time even if you’ve already moved in.
Unless you’re selling a home during probate – the process of sorting out inherited assets and money – or you have power of attorney over someone’s assets, you must be the registered owner on the Land Registry to sell it. Your solicitor will register your ownership with them once you have bought a property, but this can take several weeks.
Even once it is registered in your name there are still some potential stumbling blocks:
Cost – selling a home is expensive. You’re likely to have to pay for solicitors, estate agents and a removal service. On top of this, you’ve only just covered all the expenses involved in buying a home, such as stamp duty. This can make it a financially damaging thing to do. Your home won’t have had time to rise in value to make up for those costs unless you have made substantial improvements to it.
Early repayment charges (ERC) – you’re likely to be tied into a mortgage deal which may include an ERC. These are used by lenders to protect the interest payments you are making for a certain period of time. They are usually for a percentage of the overall mortgage value and decrease each year of the deal. So the ERC on a five year deal may begin at 5% in year one, moving to 1% in year five. If you sell up and repay your mortgage during this time this charge could run into thousands of pounds.
Six months rule – most mortgage providers will not lend to someone buying a home that has been in ownership for less than this time. Bear in mind the six months starts from the date a home is registered, which, as we’ve noted, can take several weeks.
This will restrict the people who can buy your home to those who do not need a mortgage, which means you may struggle to find a buyer.
Some lenders will be flexible for homes that have been renovated but you’ll have to prove that significant improvements have been made. They may also allow exemptions for properties that have been inherited recently. However, if you do want to sell an inherited home quickly it might be worth keeping it registered to the person who has passed it on to you, rather than putting ownership in your name.
Buyer reticence – most buyers will research a home they are interested in thoroughly. They’ll look on portals to find out when it was last sold and how much it cost. If they notice it was sold within a year or less they’ll wonder why. They may suspect there is an issue, such as nuisance neighbours, and could be put off.
One of the advantages of working with us is the fact we only buy houses from our own funds. We do not work with mortgage companies and we are not involved in chains which so often break down and delay a transaction. That means we can work quickly and are not subject to the six month rule mentioned above.
There are no estate agent’s fees to pay when you work with us and we cover the costs of valuations and any other checks we need to make. What’s more we instruct and pay for independent solicitors.
If you’re looking to sell a house you’ve just bought or inherited it’s likely to be a stressful and unsettling time. We have many years of experience dealing sensitively with these kinds of home-selling situations and always do everything we can to make the process as hassle free as possible. If you’d like to chat about your needs and our service, please get in touch.