2020 was an incredibly challenging year for landlords. The global pandemic and associated lockdowns led to a great deal of economic uncertainty and impacted the financial security of many households. As a result, research suggests that as many as 200,000 private rental households are currently in arrears.
These increasingly challenging conditions mean that many landlords are considering selling an investment property. One property buying company has reported a 60 percent increase in the number of enquiries it has received from landlords looking to sell.
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If you are considering selling a rental property, you may be concerned about the impact of trying to do so during a pandemic. These top tips will help you improve your chances of securing the sale you are looking for.
Choose the right agent.
Many experts predicted that the global pandemic would trigger a property market crash. Thankfully, the furlough scheme and stamp duty holiday introduced by the government in response to the pandemic not only averted a crash, they actually created increased demand. This means buyers are out there looking to buy, if your property is ready to sell.
The property market has had to adapt marketing practices to meet changing conditions and guidelines as the pandemic has developed. Property photography, accurate floorplans, video tours and virtual viewings are increasingly key to attracting interest in properties. If you are hoping to sell an investment property, choosing a proactive agent who has adapted well to changing conditions will ensure that you are able to capitalise on the increased demand ignited by the stamp duty holiday.
Price the property competitively
If you are hoping to make the most of the demand that has been created by the stamp duty holiday, it’s important that you price your property competitively. According to Rightmove, sellers who priced their property correctly from the start sold their properties in half the time of those who were required to reduce the price.
Demand is currently high, but many are predicting that demand will drop off quickly once the stamp duty holiday comes to an end. If you are hoping to secure a sale before the deadline, you are quickly running out of time. In order to make sure your property attracts the desired interest from potential buyers, it is important that it stands out from the competition. This means ensuring it is either the most desirable or the most competitively priced property.
Consider alternative ways to sell
If you are in a hurry to sell, or are concerned about costly vacant periods, you may want to consider different methods of sale.
Property auctions can be an attractive option if you have got an unusual property, or you are particularly keen to market your property to other investors. Unlike a sale on the open market, a property auction offers a definitive deadline. All sales must be completed within 28 days of the auction. The price you achieve at auction will depend on how strong demand is for the property. If lots of people bid on the property, you could end up far exceeding the guide price. If, however, you have few bidders, you may end up selling the property for below market value. You can set a reserve price for the property that you are unwilling to sell for less than, but it is worth noting that if the property doesn’t sell you will still be required to pay several of the costs associated with selling at auction, including marketing fees and listing costs. It is estimated that only around 72 percent of properties that go to auction successfully sell, so whilst auction is considered a faster than the open market, it is not a guaranteed method of sale.
If you are keen to sell your property in a way that offers a sale deadline, but want a bit more certainty than a property auction can offer, you might want to consider selling to a cash home buyer. A genuine cash home buying company will be able to offer you a guaranteed property sale on a date of your choice. With the ability to complete your sale in as little as 7 days, a sale to a professional home buyer can eliminate expensive vacant periods. A genuine cash home buyer will pay less than market value for your property – typically 75 to 85 percent – so it won’t be the right option for every property investor looking to sell a rental property. It may, however, be worth considering for those looking for a quicker and more predictable alternative to the open market.