Home Insurance

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There are now more ways to sell your house than ever before, partly thanks to the internet, and the costs vary dramatically.

Specialist home insurance broker Adrian Flux takes a look at the options.

1) Estate agent: the tried and trusted method, and still used by about 90 per cent of sellers, despite coming under attack from online-only sellers in recent years. Why? Well, agents offer a comprehensive service, and have the benefit of local knowledge, trained negotiators, a database of potential buyers, and they don’t get paid until your house sale is completed – so they are always keen to chase up chains, ensure possible buyers have access to funds, and get your house sold as quickly as possible. The downside? With commission rates typically between 1.5 and 2 per cent, it could cost up to £6,000 plus VAT to sell a £300,000 home.

The agents argue that their negotiating skills and local knowledge can get you a higher price, outweighing the savings that can be made from the new breed of online agents.

Over the years, complaints about the quality of estate agents have piled up, including a damning report by consumer group Which?. So it’s worth getting more than one agent to value your house, find out which agent sells the most homes in your area and identify who you are likely to get the best service from.

But if your home is in an area where sales can be difficult, or you don’t have the time to show buyers round your house yourself, or you’re just not very good at negotiating, then the good old agent can still be a good way to sell.

Sale2) Online agent: Increasing numbers of sellers are bypassing traditional High Street estate agents, with their high fees and at times questionable reputation, and using much cheaper online portals.

For between £100 and £500 (compared with the £6,000 quoted above), sellers can register with one of the better known online agents, like Housesimple.co.uk or eMoov.co.uk, and have their home listed on leading property finder sites like RightMove and Zoopla.

And given that two out of every three new owners find their home on RightMove, do you really need to do much more than that? As far as the online agents are concerned, selling your house on RightMove etc is almost as simple as selling your car on AutoTrader.

Russell Quirk, founder of eMoov.co.uk has said that “given 95pc of property searches now start online, it seems ridiculous for estate agents to continue charging hefty percentage fees when so much of the job is now done for them”.

Some also claim that it’s a myth that estate agents will get you the best price, as a £10,000 uplift in sale price only earns them an extra £200 based on 2 per cent commission – so are they actually more likely to sell quick at a lower price than spend more time negotiating?

Online agents will usually leave you to conduct your own viewings, so you need to have to time and patience to show multiple people round your house, but they will value your house, take photographs, draw up a floorplan, provide a for sale board and send out hard copy details – all services carried out by traditional agents.

If you are in no rush to sell, live in a high demand area, and want to test the water, potentially saving yourself thousands of pounds, an online agent is worth considering.

2377441778_eb84f47a68_o3) Private sale: If you’re really in no rush and live in an area of high demand with a reasonable footfall on your street, you could simply put up a home-made for sale sign and wait for people to knock at your door, while advertising your home via social media like Twitter and Facebook and trusting to luck.

You’d have to be very relaxed about selling your home to do that, but there are other ways of selling your home for next to nothing.

You could try one of the “for sale by owner” websites, such as The Little House Company and HouseWeb, which are not registered estate agents and charge a small fee to advertise your property on their and selected other websites – though crucially, not RightMove or Zoopla, which only accept ads from registered agents.

But because they are deemed “publishers” rather than agents, you may be able to use them in conjunction with an estate agent without having to pay their fees if you sell your home privately – though make sure you read the terms and conditions of your agent’s agreement carefully.

4) Auction: Sale by auction is usually associated with vacant properties, those in need of renovation, repossessions or distressed assets, or highly desirable properties where bidding is likely to be competitive.

It’s very unusual for someone to use an auction to sell a standard, owner-occupied home, not least because of the high costs involved and the fairly low chance of getting the best price.

And if your house doesn’t sell at the auction, you still have to pay the costs of the auctioneer for marketing the property in advance, which can include a listing in the auction catalogue, photography, a for sale board, advertising costs and dealing with enquiries. Unlike an estate agent, auction houses usually require paying even if your property doesn’t sell, from about £450 upwards.

hammer-311342_1280On top of that, the commission is usually about 2.5 per cent plus VAT, higher than the majority of estate agents.

The advantage of selling by auction is that as soon as the auctioneer’s gavel falls, you should get your money within 28 days, and if the buyer pulls out they will be hit with stiff penalties, you get to keep their 10 per cent deposit, and they will have to make up the difference if you eventually sell for a lesser amount.

5) Raffle: We all know how a raffle works – you buy a cheap ticket in return for the chance of winning a decent prize (or a bottle of plonk someone’s had in their cupboard for a few years…).

But some people have opted to sell their homes by raffle – especially in the falling markets of the the credit crunch.

You are far less likely to see raffles in a rising market, but some saw it as a chance to get more for their home by selling tickets, typically priced at £25, in the plummeting markets around 2008.

However, it’s a very risky proposition, not least because just to break even on the average UK house price of £169,124 vendors would need to sell 6,765 tickets, and that’s before you take into account setting up and advertising costs.

You’ll be doing well to shift that many tickets in the local pubs, newsagents, shops and takeaways.

There are also strict laws governing raffles, overseen by the Gambling Commission. One Wirral family ended up “living on the breadline” after attempts to sell their £725,000 home came unstuck when the Gambling Commission raised issues about the “skill-based” question entrants had to answer.

For most, a raffle will seem like a gamble too far.

Whatever type of home you’re selling, Adrian Flux can provide bespoke home insurance for your new residence, whether it’s a thatched cottage, listed building or standard home.

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