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If you own a property that is worth at least a million pounds, you could experience some extra hurdles to selling compared to a house or flat of a much lower value. This guide will walk you through the pros and cons of trying to sell this type of home. It also provides advice on your best options for increasing your odds of a buyer making a quick and fair offer for the property.
- How to know whether you’re selling a million pound house or flat
- Reasons why buyers could be looking to own a million pound house
- Concerns to consider when selling a million pound property
- Mortgage lenders might be wary about loans to buy a million pound home
- Deciding how to sell your million pound property
- Frequently asked questions about selling a million pound property
How to know whether you’re selling a million pound house or flat
When some people think of a million pound house, the first image they may think of is a palatial country mansion with acres of land, something like the estate in the TV show Downtown Abbey.
But the reality is that semi-detached houses, penthouse flats and other smaller properties have been selling for millions of pounds in London for years. From a legal perspective there are no reasons why you can’t sell a million pound property. And it’s not just in the capital city where home sale prices can easily exceed the seven figure threshold, because quick home buyers like LDN Properties have plenty of experience with buying million pound houses and flats.
Typically, these homes are freehold, meaning that you are the outright owner not only of the building but also the land on which it was constructed. As this guide explains later, that could be appealing to certain type of buyer compared to a leasehold home where they’d only own the house or flat for a set number of years and they would pay the freeholder a yearly ground rent.
There are a number of steps that you can take in order to get a fair estimate of your home’s worth. One tool you can use is an instant valuation calculator available on Zoopla and other property sales websites.
These tools take a range of information, including historic home sale prices in your area, the location and more. But these details can often be outdated and not account for more recent developments that could affect the potential sale price of your property, including recent construction in the neighbourhood, renovations you’ve made to the home and more.
For that reason, you shouldn’t rely solely on such instant when trying to find out the value of your property. Consider using other sources to add to your list of price estimates.
Estate agents can be a useful way to get free quotes of the possible sale price for your flat or house, as they should willingly give you these at no charge or commitment for you to use their services to sell your property. Just beware that some estate agents may quote very high estimates for selling your home despite secretly knowing that they will only be able to find a buyer at a lower value. They do this as they want you to sell with them, so that they can profit from the commission that they’ll be able to charge if you they’re able to find a buyer.
Other methods of obtaining free quotes for your home’s sale price include asking auctioneers to give you a valuation or getting in touch with honest quick home buyers like LDN Properties.
None of these price quotes that you receive should require you to make any immediate binding agreement to sell your house or flat via a specific estate agent, auctioneer or quick buyer.
Reasons why buyers could be looking to own a million pound house
If you’re the owner of a million pound house or flat and you’re looking to sell it, you could focus on promoting several factors that may make your home more appealing to buyers.
Because million pound houses can often be freehold, this may make them more attractive to certain buyers who want to own their next property outright and not buy a leasehold home.
Often, but not always, million pound homes tend to be significantly larger than the average property, whether that means it has several extra bathrooms and bedrooms, several acres of land or various other appealing features not found at smaller, lower-value properties. This could be one of the main factors that gets a potential buyer interested in making an offer.
There is also a certain set of buyers that will see owning a million pound house as some type of status symbol to be envied, and they could even conduct their searches for properties by using a million pound value as the minimum amount that they want to pay for their next home.
Some buyers may have concerns about purchasing a million pound property
Although million pound houses can have certain aspects that appeal to buyers, there are also a few reasons you should know about for why others may be reluctant to make an offer.
Some potential buyers could think the million pound price for your home is unrealistic, as an Investopedia article explains. If they believe that your property is worth significantly less than a million pounds, these buyers will lose interest in making an offer.
This type of property might also be much larger than other homes, with many more bathrooms, bedrooms and land to maintain. The potential costs involved with keeping the home clean, funding the necessary electricity bills and other expenses may be too much for some buyers.
A million pound mortgage will inevitably result in large monthly repayment amounts, and sometimes with higher interest rates than a mortgage for a much lower amount. That could create significant concerns for buyers about whether they’ll be able to keep up with the repayments.
Mortgage lenders might be wary about loans to buy a million pound home
Even though many of the UK’s leading banks might be able to offer a million pound mortgage, prospective buyers could still struggle in getting approval for one, as noted on the website for Clifton Private Finance. And if they can’t get a mortgage, the sale won’t happen.
Home loan providers take a risk when approving mortgages, through which they help someone cover the cost of buying a property and then that loan is repaid via monthly instalments plus interest. A mortgage provider may have to move to repossess a home if the buyer falls behind on the repayments, and then sell the house or flat in order to recoup the remaining debt.
Many mortgage lenders might be worried that a million pound house might be significantly harder to resell than a property at a lower price, because of its high price tag and related factors explained in the previous section of this guide, and therefore they could deny the loan.
But don’t worry that this means you’ll never sell your home, because you still have some choices available. They include selling to a quick buyer, who can make a competitive and speedy offer to purchase your home without the need to first obtain a mortgage.
Deciding how to sell your million pound property
An important choice that you will need to make when trying to sell a million pound property is selecting which approach to use for finding a buyer. Usually, your options are selling to a quick home buyer selling at a property auction, selling on your own or selling with an estate agent – and there are some distinct advantages and disadvantages with these various methods.
For example, selling your home via an estate agent might take more than an entire year, which isn’t a good outcome for those owners that would like to sell their property as fast as possible. But other methods have perks, such as avoiding having to pay any fees when you get in touch with a legitimate no-fee quick home buying company like LDN Properties.
You can find the best option for your situation by writing down your top aims with selling your home, including how the price at which you would like to sell, how quickly you want to find a buyer and whether you can accept paying any commission when selling. Then compare these goals against the specifics of the four methods below to find the best match for your needs.
Selling to a quick home buyer
Quick buyers are companies such as LDN Properties that have the funds available to purchase homes immediately, resulting in very fast schedule that includes exchanging contracts and the owner receiving the full sale proceeds within a handful of weeks. They can buy so quickly as they don’t need to wait weeks or longer to get approved for a mortgage to cover the purchase.
A great benefit of selling this way is that quick buyers can make competitive and fast offers to buy practically any age, condition, location, shape size or type of home, whether it’s a freehold or leasehold house, flat or other residential property. That includes properties that may have potential negative factors, such as a home that is suffering from major structural damage.
LDN Properties has been buying and making offers for homes across the UK since 2003, and that includes not just million pound properties but also houses with lapsed planning permission, lock-up garages, houses with a bad roof, properties with a regulated tenancy, hoarder’s flats, empty homes, investment properties, British Iron and Steel Federation houses, flats with rot problems, inherited houses, homes that have survey problems, unmortgageable flats and many other situations.
You can also avoid paying fees when selling your home to a zero-commission honest quick buyer, which will assist in lowering your net costs and is a great outcome for those homeowners who want to avoid spending much money when selling. And it compares favourably to auction or with an estate agent, where you’ll pay sometimes high fees that will add to your expenses.
Always check whether a quick buyer belongs to The Property Ombudsman, (TPO) which is an independent organisation that writes rules to guard homeowners from fraud in the industry. All legitimate quick home buying companies, for example LDN Properties, must follow these rules, giving sellers extra peace of mind.
To check a quick buyer’s membership status, visit TPO’s website and click on the "Find a Member" link on the homepage and type in the name of a specific company – if they are genuinely registered with TPO then you will be shown their full membership details. Be cautious if you sell your home to a company that cannot prove it’s a TPO member because it might be a scam.
Selling at a property auction
Auctioneers will handle most of the steps involved with selling your home, beginning with the preparation of a listing that describes the property and features photographs of the interior and exterior. They will advertise this listing and potentially organise viewings, where people who are interested in your home have the chance to tour it. And finally, they will host the auction itself and oversee the paperwork and other steps needed if your property manages to sell.
It’s always a gamble selling a home this way because you don’t know how high the bids might go, so your final sale price is highly uncertain. And it’s important to note that if you do not receive any qualifying bids on your property then it will be considered unsold. This situation will add more time to the selling process because you’ll need to start over with seeking a buyer.
If you choose this option and your home sells, the auctioneer will charge you commission that will add to your costs because it will be subtracted from the final auction proceeds. Usually this is a fee of 2.5 percent of the property’s sale price, but it might be set at a lower or higher rate.
Some auctioneers could be open to negotiating a reduced rate of commission or agreeing to have the winning bidder pay some of your fees, so it’s worth inquiring about this possibility.
When selling your home through an auction, you will be required to choose a reserve price, which is the lowest value at which you can accept selling your property. If you get just a single bid at this price then your home is considered legally sold, and the buyer could sue you to enforce the sale if you then try to get out of it. That’s why you must take time to calculate a reserve price that will produce some profit for you even after paying the auctioneer their fees.
For those homeowners who want to sell fast, you may want to think about other options because this can be a slow method to find a buyer. There will be a wait of many weeks or longer between when you decide to sell this way and when the auction happens, and a further delay if your home sells. That’s because the winning bidder will usually have about 28 days to sign their mandatory legal papers and complete their other tasks needed to finalise the purchase.
Some auctioneers may give the buyer even more than 28 days for finishing their various required actions, but you can ask individual companies to see if they’re open to setting a quicker deadline, as this can be one solution for speeding up the overall timeline of selling at an auction.
Selling on your own
You could try selling your property without any help from an estate agent or auctioneer, but this may be a very lengthy and stressful way to seek a buyer. You’ll be responsible for every necessary step, from creating and advertising a listing through to organising viewings and fielding offers from buyers, and it’s not something you can just do in your spare time.
That’s why this approach to selling is only recommended if you have a friend or family member with experience selling a home like yours, and they are willing to help for free with attracting buyers to your property, or if you have successfully sold properties in the past. If not, it could become a very complicated approach that might take more than a year before you sell.
Another possible drawback of selling without any assistance is that someone could make a genuine offer to purchase your property but then withdraw it, and they can do this without being subject to any penalties so long as contracts have not yet been exchanged. This will delay the selling timeline further because you will have to start again with looking for a buyer.
That potential delay is on top of the already lengthy schedule you face when selling on your own, as you should not be surprised if it takes over a year before getting a serious offer. Owners that want to sell their home as fast as feasible should review some of the other options.
One such alternative is selling your home to a quick no-fee buyer like LDN Properties. This would not only give you the same benefit of avoiding having to pay any commission, but you will enjoy an additional advantage of completing the sale of your property within a few short weeks, and that includes the time required to pay you the full proceeds and exchange contracts. It’s a much speedier and less stressful way to sell a home compared to doing so on your own.
Selling with an estate agent
Or you may be thinking about selling your home via an estate agent, which will mean a reduced workload for the owner because the company will take care of the key tasks – such as crafting and marketing a listing, taking care of viewings and hearing offers from buyers.
Selling via an estate agent will add to your expenses because, if they manage to find a buyer and contracts are exchanged, you’ll be charged commission. This is taken out of the sale proceeds and is usually set a rate between 1.15 percent and 1.40 percent of your property’s selling price, although certain companies may charge higher or lower fees.
This is not the speediest selection for selling any type of home, as it may take at least many months to find a buyer and potentially even more than a full year. Owners who would like to sell their properties on a much speedier schedule should consider other options.
Just as buyers could make an offer and then rescind it before contracts are exchanged when you’re selling on your own, the same is true when selling via an estate agent. A buyer can make an offer then cancel it and cause the sale to collapse. This will inevitably delay the sale of your home because you’ll have to spend more time on searching for another buyer.
You could also find that some estate agents might quote a high sale price for your home even if they know it will only sell at a much lower value. They do this trick to persuade you to sell using their services, so that they’ll be able to charge you commission if they find a buyer.
It’s simple to avoid falling for this trick, just browse property selling websites like Rightmove or Zoopla and note down the past and present sale prices of homes like yours, and then ask multiple estate agents to give you free selling price estimates for your property. The average of all these values should be a more accurate estimate of the home’s potential sale price.
Top queries and answers about selling a million pound property
Homeowners looking for a quick sale may have some questions to ask, ranging from the amount of repair work needed before selling through to selling a large house. Here are some of the top questions we could be asked about selling a million pound property:
Your top questions when selling a million pound property
There are several sources of information that could use in order to get a free estimate of your home’s value and whether it’s worth a million pounds. Estate agents, quick buyers and auctioneers should provide you with no-cost and zero-commitment quotes of your home’s potential selling price, and you can also use instant valuation tools on property sales websites.
You could find that prospective buyers have a number of justifications for wanting to own a million pound property, including the fact these homes tend to be freehold and therefore they would get to own the building and the land outright. Million pound homes are also typically larger than other properties, which can be attractive to buyers seeking more space.
There are several explanations for why a potential buyer could have concerns about owning a million pound property, including the likelihood that their mortgage repayments will be very high and potentially hard to keep up with. Other buyers could have concerns about the utility bills and other expenses involved with maintaining a home if it’s valued high because it’s very large.
Possibly, but they could struggle to obtain such a loan because mortgage providers might worry that it will be hard to resell the home in the future if they buyer defaults on the repayments. If a buyer would have to rely on getting approved for a mortgage to purchase your property, the sale would be unable to happen – but you still have other options for selling the home.
If you decide to sell your property using the services of either an auctioneer or an estate agent then you will need to pay them commission and this will be subtracted from the final sale proceeds, which adds to your expenses. By contrast, you can reduce your costs and avoid paying commission by selling to a no-fee quick buyer or selling without any third party help.
The quickest option to sell a home is usually getting in contact with LDN Properties or another quick buyer because it should only take a few weeks in total. The other typical methods for finding a buyer – selling through a property auction, selling with an estate agent and selling without any help – can often take many months and possibly even longer.
You can ask individual companies whether they can prove they are registered with a third party entity known as The Property Ombudsman (TPO), which publishes policies to protect owners against scams in the quick buying sector. All true TPO members, like LDN Properties, have to follow these regulations and this should give you additional peace of mind when selling.
