A property that needs work, whether that is cosmetic updating or something more serious, often does not sell the way owners expect on the open market. The main reason is mortgages.
Why mortgages matter
Most buyers need a mortgage, and lenders are cautious about properties they may not be able to sell if the borrower defaults. A lender may refuse to lend, or hold back money until work is done, if a property has:
- no working kitchen or bathroom
- serious damp, subsidence or other structural problems
- unsafe wiring or no heating
- a very short lease or unusual construction
That rules out many buyers before they have even viewed the property, whatever the asking price.
Who buys properties that need work
The buyers who can complete are mainly cash buyers and investors looking for a project, and buyers at auction, where condition is expected and the timetable is fixed. Their offers reflect the cost and risk of the work, so expect a lower price than a fully modernised home would achieve.
Should you renovate first?
Sometimes it pays to do some work before selling. Often it does not, particularly if time or money is tight, or the work is extensive. Things to consider:
- the realistic cost of the work, plus a contingency
- how long it will take, and the costs of owning the property meanwhile
- how much more the property would sell for afterwards
- whether you have the time and energy to manage builders
Small jobs, such as clearing and cleaning the property or fixing obvious minor faults, can help with any route.
We will give you a straight view of whether doing anything before selling is likely to leave you better off, or whether selling as it is to the right buyer makes more sense.