Alternatives to selling
3rd October, 2015
What are your options if you are having problems selling your house? We look at some alternatives.
If your home has been on the market for a while and you have had difficulties in finding a buyer then there are alternatives you may wish to consider.
Renting out your home – this may be particularly beneficial where you want to move home temporarily, perhaps for work purposes, and you want the option to move back.
However, before renting out your home, you should always check whether you need any consent to do so. If your home is leasehold then you should ask a solicitor to check the terms of your lease to see whether the consent of your landlord will be required.
Additionally if you have a mortgage you will need to seek the consent of your mortgage lender, who may in turn wish to switch your mortgage from a residential to a buy-to-let loan, which may have a higher rate of interest.
House exchange – these are particularly common where you are buying a newly built property from a developer who may be willing to take your existing property in part-exchange, usually when you are up-sizing.
There are also several websites that facilitate a house exchange or swap whereby you advertise your home and provide details of the house that you are seeking in exchange. If you find a match then the sale will proceed in the same manner as any other sale and you will need to instruct a solicitor to act for you on the sale of your home and the purchase of the property you are taking in exchange.
One of the main advantages to a house exchange is there is no chain involved and it is a one to one sale, with each party buying from and selling to the other.
Equity release schemes – such schemes allow you to stay in your home whilst accessing its value for cash in retirement and are usually only available to people over the age of 55.
There are two main schemes: firstly a lifetime mortgage where you can borrow a proportion of your home’s value, interest is charged but nothing usually has to be paid back until you die or your home is sold; and secondly a home reversion scheme where you sell all or part of your home for less than the market value in return for a lump sum or regular income and when you die, move into long term care or sell your home, the provider gets the same share of the property at whatever price it is sold at.
These schemes are usually expensive and could have major implications for tax, benefits and inheritance and suitable advice should be obtained.
Quick house sale companies – these are companies that offer to buy houses quickly but usually at a discount from the full market value. This may be worthwhile where selling your property quickly is more important than achieving the best price but you should take legal advice before agreeing any sale and get independent valuations so you are fully aware of the market value of your home before entering into negotiations. An alternative to a quick house sale company would also be to list the property in auction.
Postpone selling – if you are not in any hurry then you may have more interest if you take the property off the market for a while and then re-advertise during a different time of the year or after you have had the opportunity to carry out improvement works to make the property more attractive to buyers.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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