Selling a House at a Loss

If you’re considering selling a house at a loss, there are various things to make sure you are aware of covered in this guide.

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Your top questions when selling a property at a loss

✅ When does a property sale qualify as one that's done at a loss?

If you sell your home for less than the value of what you originally paid for it, including any money that you later invested in major structural improvements to the home – such as a renovation or extension – then it is considered to be sold at a loss. Your goal when selling should always be to make a profit by getting offers above the original purchase price.

✅ Is all the money I spent on my home factored into whether I make a loss?

No. The two main factors that are considered when calculating whether or not you’ll make a loss when selling your property are the original purchase price, and the amount of money you spent on extensions or other major physical changes to the home. Expenses that shouldn’t really be factored into the loss calculation include money that you spent on furnishing and decorating your home.

✅ Is there any way to avoid fees when selling in order to avoid a potential loss?

Yes, if you sell to a fast buyer like LDN Properties, because they will never charge you any fees and you can count on receiving the full proceeds from the final price offer they make for your home. By contrast, auctioneers and estate agents will charge commission for selling your house or flat that will be deducted from the sale proceeds, possibly resulting in a net financial loss.

✅ What is the speediest way to find a buyer when selling my property?

If selling a house or flat as quickly as possible is your top priority, you should consider using a quick home buying company like LDN Properties. They can generally complete the process of buying a property within a few weeks. Auctions, by contrast, will take at least a few months from beginning to end, and selling through an estate agent might take more than a complete year.

✅ Should I attempt to find a buyer for my home on my own to avoid selling at a loss?

You may be able to achieve a higher price by finding a buyer yourself however bear in mind there often is a large amount of work involved with selling a property, with the only benefit being that you won’t have to pay any fees. If you sell your home to a fast buyer then you won’t get charged any fees and it will also be stress-free.

✅ What happens if I still owe on my mortgage after selling because I sold at a loss?

When you sell your home whilst it still has a mortgage, the sale proceeds will first be used to pay off as much of that loan as possible. If you sold at a loss, this could create some financial problems in the future because you’re legally obliged to pay the rest of the mortgage back. You’ll have to work with the lender to agree on a timeline for making those payments.

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