A new guide on how to sell an investment property has been launched by the National Residential Landlords Association and its sales partner, Movewise.
The guide complements a series of online help pages, all of which are set out at the end of this article.
How you go about preparing for a sale will depend on whether you are marketing it with vacant possession or with tenants in situ, and whether you are targeting investment buyers or the wider market, but the same general principles apply. By following these seven steps, you can help ensure that you get the best return on your buy-to-let investment.
Is the time right? - If you have the luxury of time and want to achieve the best price, it can pay to wait. Spring is traditionally the busiest time of year for property searches, although traffic data from property portals shows that interest from buyers increases dramatically right from the beginning of January after a lull over the Christmas period. The Movewise advice is to beat the rush by listing as early as you can in the New Year.
As for the rest of the year, the most obvious seasonal trend is the summer slowdown when many buyers will be away on holiday, or too busy with children to go house-hunting. A quiet summer is often followed by a surge of interest in September, so that is also a good time to hit the market.
Sell with tenants or without? - A vacant property will be attractive to a wider pool of buyers: not just investors but also potential owner-occupiers. This should give you the greatest chance of a sale at the best price. However, the current trend for landlords to sell up has drastically reduced the availability of rented property.
Movewise encourages landlords to consider selling with tenants in place to other landlords, where possible.
Get The Property Ready - How you prepare for a sale will depend on whether you are marketing it with vacant possession or with tenants in situ, but the same general principles apply.
Here are seven things to bear in mind when you prepare your home for sale - Tell the tenants; Carry out repairs; Keep it clean and tidy;
Redecorate if needed; Tackle the kitchen and bathroom; Sort out the garden; Be honest about any problems.
Set your price - The right price is vital. Ask too much and you will put people off from even looking at your property, and risk having to cut the price, which can make buyers think there is a problem. Set the price too low, however, and you’re throwing money away. With investment property, there is an additional factor when setting your price: yield. Over the past three years, average rents have risen only a third as fast as underlying property prices. It may be wise to review the rent as soon as your tenancy agreement allows.
Choose the best sale method - Almost 90 per cent of property in the UK is sold through estate agents, but for investment property that is not always the most suitable method. Movewise has recently launched a Property Marketplace allowing landlords to market directly to other landlords.
Sort out your paperwork - When selling any property, there is a long list of documents and paperwork you need to produce. These are the main things you will need: Sales pack/management pack; Proof of identity; EPC; Title deeds; Transaction (TA) forms; Gas and electric safety certificates; and Documentation for alterations and extensions.
When selling with tenants in place you will also need: Signed tenancy agreement; Evidence of tenants' right to rent; Inventory; Condition report, and details of any repairs; and Details of deposit protection. And remember - the tenant's deposit will need to be transferred to the buyer.
Appoint a conveyancer - Whether you are buying or selling a residential property, you will require the services of a legal professional to handle the conveyancing process: that is, the official transfer of ownership from vendor to purchaser. While it is not a legal requirement to use a qualified professional, it is strongly recommended, as mistakes in a property transaction can be extremely costly.
Here are the main Movewise documentation links:
Movewise’s full guide to selling investment property is intended to help landlords who are thinking of selling to prepare their property for a smooth sale, and choose the right method for their individual circumstances.
For more information on the pros and cons of selling with tenants in place, see our full guide to selling tenanted property.
See Movewise’s full guide to valuing your property.
And here is Movewise’s new property Marketplace