Beware speedy home sale deals that come at a cost

Property experts have warned homeowners struggling to sell their properties to be wary of “quick sale” companies. Such firms promise to buy any property, and offer desperate vendors a quick completion — but the sale price could be well below market value.

Despite the latest figures suggesting that the London property market is hotting up, the numbers are skewed by sale prices in the capital’s prime boroughs. The latest Land Registry data show that some parts of London have witnessed double-digit growth in property values over the past 12 months. The boroughs of Kensington & Chelsea, City of Westminster and Hammersmith & Fulham saw 16.1%, 14.4% and 10.6% growth respectively.

But it is a different story in some of the less affluent boroughs, with sellers facing a stagnant property market. The latest Time On Market report by website Home.co.uk shows the average London property was up for sale for 146 days, but it takes a lot longer in some areas. In SE11 (Kennington/Oval), for example, it takes an average of 243 days to find a buyer.

For those desperate to move house for any one of a number of reasons, a quick sale property company may seem an ideal solution. A simple Google search shows pages of quick sale companies, including webuyanyhouse.co.uk, nationalhomebuyers.co.uk and quickbuyers.co.uk. These firms guarantee to make an offer on your home and, if you accept it, complete the transaction quickly — often within 28 days.

Some offer to pay all the legal fees while also highlighting the fact that vendors can avoid estate agents’ fees by selling this way.

However, the Royal Institute of Chartered Surveyors warns that these companies are unlikely to offer sellers the value they might hope for.

It says that although some quick sale companies promise anything up to 90% of the value of a property, this is based on their interpretation of the market. In reality, this means the offer will normally be much less than the valuation an estate agent might give, potentially losing the homeowner tens of thousands of pounds.

Peter Bolton King, global residential director at the RICS, says homeowners in need of a quick sale for their property are, by definition, vulnerable and targets for quick sale companies.

“Those deciding to go ahead with a quick sale will generally expect a small loss. However, it is always worthwhile taking out an independent valuation before speaking to any firm to assess how much value is actually being lost,” he advises.

“While the emphasis will be on speed for those facing repossession, they should take the time to speak to multiple companies and never accept the first offer — there is always room for upward negotiation.”