Sell House To an Investor

Another question I get asked is, “Can I sell my house to an investor?”

You can sell your house to anyone, but if you’re selling to an investor, it has to tick a few different boxes than if you were selling to a pure residential buyer.

First of all, investors are looking for a decent return, what we call a yield.

Now, in the North East, generally, they’re looking for at least 10% plus.

Some people will take less on student accommodations up here in really good areas like Durham City or the Jesmond area of Newcastle. So it depends where your property is, what it is, and if it’s going to be desirable.

Now, we and our investors buy a lot of property and in doing so deal with a lot of vendors. One of the common things vendors ask is Will my house be attractive?” So then we go through the research, due diligence and look at all the details and after this speak to the vendor giving the honest and transparent feedback on the attractiveness of their property to us and our investors.

If the property higher prices, which is typically £100,000, such as a new build in a residential area, in the North East is unlikely to achieve the desire rate of return. The return will be typically be less than 5% which won’t be attractive to your typical investor.

So in that case, it’s not likely that its going to be a sale to an investor but most likely to a residential buyer.

Which is a totally different type of buyer.

We’ve got to be aware of that. Some properties will be attractive to both, but specifically under £70,000 in most areas of the North East will be attractive to both. Both at £100,000, unless they’re in really desirable areas which compensate for a lower yield, investors typically won’t seek to purchase.

If we take another example, say Sutherland, an area we know quite well, if a vendor is selling a house for say £150,000 this won’t typically sell to investors. It’s going to be a residential sell. However, if we have one between £40-£60,000 the probability of an investor purchasing the house will increase significantly, depending on what type of property it is, its condition, its location and many more factors.

So I always say we have to evaluate your house and your situation, and we will then be able to confirm if it will be of interest to a cash investor.

And if you want to have a chat about this free to give me a call on 0191 486 2386, or complete the form below and Ill give you a call back.