Quick navigation
When you sell your house or flat as for "cash buyers only" it means that you’ll only accept offers from buyers who already have the funds upfront to purchase your property. This can be a good way to ensure a smooth and speedy sale, but there are some potential hurdles to understand, as well as alternative sale methods if you decide that it’s not right for you.
- What does a "cash buyers only" property sale mean?
- Reasons why some homes are designated for cash buyer only
- How to find a cash buyer for the sale of your property
- Advantages of only accepting cash offers for your home
- Disadvantages of only accepting cash offers for your house
- The average timeline when selling your home to a cash buyer
- Alternatives to selling your home for cash buyers only
- Questions and answers about home sales for cash buyers only
What does a "cash buyers only" property sale mean?
When you are ready to sell your house or flat, regardless of whether it’s leasehold or freehold, you will have a number of options for how to find a buyer. You might want to try your luck with an auction, use the services of an estate, contact a quick property buyer, or even try selling your home privately.
If you decide to try selling on a "cash buyers only" basis, this means that you will only entertain offers from potential buyers who already have the cash funds in place to swiftly complete the purchase of your property. Many buyers need to first obtain mortgages to have the funds required for purchasing a home, and this can be a lengthy process over several months. If you want a sale within just a few weeks then such a timeline could be too slow for your needs.
Therefore, cash buyers only means that buyers must have the money necessary to cover the full cost of buying your property upfront without any waiting time. There are many different types of cash buyers, including companies that specialise in quickly buying homes for cash, and private buyers who have collected the funds needed for buying their dream property.
Reasons why some homes are designated for cash buyer only
One reason why some houses and flats are listed as only for offers from cash buyers is the ongoing high demand for homes that makes the selling process more competitive.
The property market in the UK continues to favour sellers, following sustained growth in demand for buying homes in 2021 that looks set to continue through 2022 and beyond. The Royal Institution of Chartered Surveyors, a leading professional organisation for UK property surveyors, says demand for homes from new buyers continues to rise, according to a recent news article from Mortgage Introducer.
As a result, some sellers find themselves with many different offers from potential buyers, and imposing a cash only requirement can be a way to help simplify and prioritise these offers. If you are inundated with offers on your home, setting a cash buyer only mandate can be one way to ensure that you get a swift sale.
Using a cash buyer also cuts out some other time-consuming aspects of the sale process that you’d otherwise have to go through with conventional mortgage buyers. For example, cash buyers are not required to obtain a survey on the home that they want to buy, which can save a lot of time. It is still a good idea for cash buyers to get a survey so that they can uncover any problems with the property that they might not otherwise learn until they officially own it.
Cash buyers also aren’t required to conduct searches on a property, which can be another lengthy process that further slows down the sale. The ability to avoid the large amount of time needed for both surveys and searches is appealing to some buyers, particularly those whose priority is finalising the sale as quickly as they can. And that’s why they will limit the sale to cash buyers, with the hope of completely avoiding these steps in the sale process.
But there are other reasons why a home might be listed as for cash buyers only, including if the property has one or more elements that could be considered problematic. Some of these issues include dilapidated homes, properties with septic tanks, flats with cladding, hoarder’s houses, properties where the owner can’t find the title deeds, and other examples.
How to find a cash buyer for the sale of your property
If you’re interested in trying to find a cash buyer for the sale of your home, there are a few different approaches that you can take, although the success rate of each can vary.
One method is when selling your home privately or using the services of an estate agent, where you can specify that your property is only for cash buyers. As a result, you or your estate agent can immediately discard any offers that you get that are from buyers who would need to obtain a mortgage to complete the transaction.
Note that selling your home privately is a complicated process, because you will be responsible for every stage from the initial listing and advertising of the property through to scheduling and hosting the viewings and finally overseeing the completion of the sale. The UK government’s website helpfully details these and many other steps that you will have to take, and many homeowners decide against selling privately.
Another way to find a cash buyer is to do an internet search for quick homebuyers in your neighbourhood. This should produce results of companies that have the cash reserves in place to speedily buy your home within weeks rather than months.
Regardless of which approach you take for finding a fast homebuyer, as part of your search you should require that the person or entity wanting to buy your home can prove that they are a cash buyer. They should provide proof that the cash funds exist and can be accessed now for purchasing your home, such as a valid current bank statement.
Advantages of only accepting cash offers for your home
There are a number of advantages of limiting offers on your property to cash buyers that you might not be able to enjoy when selling using other methods. The many pros help to explain why roughly one third of home sales in the UK last year were done this way, according to the Homeowners Alliance.
As highlighted earlier in this guide, the swiftness of selling is perhaps the strongest draw of using a cash buyer. If an aspiring homeowner needs to first get approval for a mortgage to buy your home, you’ll have to wait the many weeks or months until that loan can be approved. And if the mortgage is rejected then you’ll be back to square one with your hunt for a buyer. Further, mortgage-based home sales can end up in a property chain, where the buyer’s ability to purchase your home hinges on their success selling their own house or flat. These chains are particularly vulnerable to collapsing, adding further stress to the selling process.
You can avoid all of this hassle with a cash buyer, because you can state your clear expectation that you want a fast and straightforward sale that can happen as soon as you accept the offer. So long as the buyer is telling the truth about their funds, there’s no reason why they can’t pay you the proceeds as quickly as possible.
Cash buyers can also be a good idea for properties that might not be easy to sell using conventional approaches such as an estate agent or auctioneer. If your house or flat has any element that might be considered negative by potential buyers then it may struggle to receive any offers, and whatever feature is at issue could also prevent buyers from qualifying for a mortgage.
Limiting offers to cash buyers only sidesteps this mortgage hurdle for homes with flaws, whilst also achieving the owner’s goal of a swift sale. Some of the properties that might be best suited for selling this way include properties with structural damage such as subsidence, inherited retirement homes, flood damaged houses, and various other property types. We can also help if you are selling lock up garages.
You can also avoid a lot of the paperwork and other complications involved with selling your home through other approaches. For example, you won’t have to worry about hosting dozens of viewings where people interested in buying your property tour the inside and outside. That can be a relief to homeowners who find viewings to take up a lot of time and can be quite intrusive.
Disadvantages of only accepting cash offers for your house
Although there are several pros of using a cash buyer for your flat or house, you should also be aware of some disadvantages that exist, as well as steps for how to potentially avoid them.
One concern that some homeowners have about selling this way is that cash buyers might try to offer significantly less money for buying a home than it’s actually worthy. A cash buyer could argue that you should accept their offer at less than market value because in exchange you will get a simplified and speedy sale. This is fine when you’re dealing with a reputable quick buyer. However, some people who try to buy homes with cash will deliberately lowball offers on homes and use the speed of the sale to pressure sellers into accepting that offer.
You can protect yourself against this outcome by doing some advance research about the potential sale price of your home. Get free quotes from estate agents, auctioneers and fast home buying companies for your property, and look on home sales websites such as rightmove and Zoopla to discover properties similar to yours. Then calculate an average of all these values to get a fairly honest idea of your home’s sale price, and refuse to accept offers that are too far below this.
And if you choose to use a fast homebuying company, there’s unfortunately always the chance that they might not be reputable. They may try to charge you fees, force you into unfavourable sale contract terms, or take other actions that will benefit them but cost you in time and money.
The good news is that there is often a simple way to find out whether your professional quick property buyer is legitimate. You can check whether they are registered with The Property Ombudsman (TPO), which is a third-party organisation that issues regulations which are designed to guard homeowners against bad practice in the fast buying sector. All TPO members must follow those rules, which helps to give you more peace of mind when selling to them.
Ask specific quick homebuyers whether they belong to TPO, and if they refuse to join then that should be a warning sign because it could be a fraudulent sign. Another red flag is if they say they’re a member but cannot prove it. To check on a company’s registration status, visit TPO’s website, click on the tab marked "Find a Member" on the left of the home page, and enter a fast homebuyer’s name. If they belong to TPO then their registration details will appear, and if these details do not show up, you should think carefully.
The average timeline when selling your home to a cash buyer
Although every home sale is unique, there are still enough common aspects of selling to a cash buyer to state that the average sale done this way takes just a handful of weeks. And this includes every step of the process, from the initial offer to exchanging contracts. You’ll find this is generally much speedier than trying to sell your home via an auction or estate agent.
Should you decide to accept the offer, one of the company’s representatives would then likely visit your home so that they can assess the interior and exterior in detail. This is also a great time for you to ask any remaining queries you’ve got about selling.
And the final step is for the cash buyer to work quickly with your solicitor to handle all of the legal paperwork involved with purchasing your home. From start to finish they should within a matter of weeks be able to exchange contracts and pay you the full sale proceeds.
Alternatives to selling your home for cash buyers only
You could also attempt to sell your property using other methods that aren’t limited to cash buyers, including auctions and estate agents. This guide earlier discussed the potential for specifying that a home is for cash buyers only via an estate agent or auctioneer, which is certainly possible although might still be difficult. By contrast, the pros and cons listed below are for selling a house or flat without the limitation that the buyer must be cash only.
Using a property auction
You could try your luck with a London property auction, here the final sale price of your home is uncertain. It might not receive any bids, in which case it goes unsold and you’ll have to start again with finding a buyer. Or it may get many bids at ever-increasing prices, which may result in a nice profit for you. A third outcome is that it might sell but only at the reserve price, which is the lowest value at which you agree that property can sell. Be sure this price is one that you are comfortable with, even after subtracting the commission that most auctioneers charge for selling houses or flats.
There can also be a wait of at least a few weeks from the day you list your home for sale until the day on which the auction takes place. If you’re fortunate enough to sell your property, the buyer also has an average of 28 days to finalise the paperwork and other steps of the process, creating a further delay. And auctioneers will charge you fees often as a percentage of home’s sale price. You may be able to make the buyer pay some fees, so you should always check with specific auctioneers for their policies on who pays fees.
Using an estate agent
Alternatively, you could consider using an estate agent who will do the hard work of marketing your property, hosting the viewings where buyers tour the home, and overseeing the completion of the sale. Although this can help to significantly reduce your workload and stress when selling, there are no deadlines associated with selling your home this way. You might be waiting at least a few months, or possibly even more than a full year, before receiving an offer from a buyer.
It’s also important to note that estate agents will charge you commission for selling your home, often as a percentage of your property’s final sale price. You’ll have to subtract this commission from the value at which you manage to sell your home, and this will reduce the overall net profit that you can expect to make from the sale. It’s possible that you might be able to negotiate a lower commission rate, so it’s always worth calling an estate agent to see whether they might accept a reduced fee.
Top questions and answers about cash buyers only
Homeowners thinking of selling their home fast often have questions for us, ranging from how to sell a farm through to selling a home in poor condition. Here are some of the top queries we’re asked about selling a “cash buyers only” property:
Your key questions – cash buyers only
You can expect the typical process to last just a handful of weeks from beginning to end when using a cash only buyer, although complications are always possible. This compares favourably to using an auctioneer that might take at least a month to market your home and then a further month to finalise any sale, and estate agents who might take many months or even longer.
Typically, cash buyers and sellers do not impose any fees, and that’s another of the main attractions of selling this way. That’s particularly true of quick property buying companies, because they aim to distinguish themselves from estate agents and auctioneers who will not only charge you fees, but also usually take much longer to sell your home.
Although there are many benefits of selling your property to a cash buyer, there can be some possible cons. Perhaps the biggest problem is that some cash buyers might make offers on your home that are below its true sale price, hoping you’ll accept it in exchange for a fast sale.
If you have decided to sell your home on a cash buyers only basis, you must then ask the person or entity attempting to buy your home for proof that they have the cash for the transaction. This is typically done through the buyer producing a bank statement that shows they have the funds to purchase your property.
Ask if the company belongs to The Property Ombudsman (TPO), an independent organisation that publishes regulations to protect homeowners against fraud in the quick buying industry. Companies that are registered with TPO must follow those rules, which offers you extra comfort. Don’t sell your home to a fast buyer that cannot prove it is a valid member of TPO or the equivalent.
No. Although a fast sale is one of the top benefits of using a cash buyer, it’s not the only reason why an owner might be selling their home this way. Their property could have a defect, such as subsidence, which makes it all but impossible to find a buyer using other methods. Cash buyers might be more open to a speedy and simple sale, which is good for the homeowner.
