The Investor Advantage: Why landlords opt for property investors instead of residential buyers

05 Jun 2023

There's no denying that the number of landlords selling their properties is on the rise. The cost of owning a rental property has gone up significantly in recent years, due to rising property prices, increased regulation, and higher taxes. As a result, many landlords are finding it difficult to make a profit on their investments.
 
One option for landlords who are looking to sell is to sell to other investors. This can be a good option for a number of reasons:
  • Investors may be a more reliable channel to sell your property through. This is because there is less chance for the sale to fall through with no chain involved. Investors have often gone through the process before and overall have more of an understanding of how it works.
  • Investors are more likely to be able to finance the purchase of a rental property. This is because investors typically have access to more capital than residential buyers. As a result, they may be able to offer a cash purchase, which can be more attractive to sellers.
  • Investors are more likely to be able to handle the costs of owning a rental property. This is because investors typically have more experience in property management than residential buyers. They are also more likely to have the resources to deal with unexpected repairs or maintenance issues.
  • Investors are attracted to properties with tenants in situ. This is because investors will look to minimise additional costs by securing a property with rental income from day one. Purchasing a property with no tenant puts you in a void period from day one, stacking up the outgoing costs.
 
In addition to the reasons mentioned above, there are a few other factors that landlords should consider when deciding whether to sell to an investor or a residential buyer. One factor is the location of the property. If the property is located in an area that is popular with investors, such as a major city or town, then it is likely to be a more desirable investment opportunity. Another factor is the condition of the property. If the property is in need of repairs or renovations, then it may be more difficult to sell to a residential buyer. In this case, an investor may be more willing to take on the cost of repairs or renovations.
 
Ultimately, the decision of whether to sell to an investor or a residential buyer is a personal one. However, landlords who are considering selling their properties should carefully consider all of the factors involved before making a decision:
 
  • Your financial goals. What are you hoping to achieve by selling your property? Are you looking to get a lump sum of cash to invest in other things, or are you hoping to generate a steady stream of income from rental payments?
  • Your time constraints. Are you looking to sell the property quickly? There's never a guarantee of a quick sale but you may find that investors are more likely to snap up a property that comes to market as an investment opportunity, rather than a place to call home.
  • Your comfort level. Are you comfortable with the idea of selling to an investor? Some landlords may feel more comfortable selling to a residential buyer because they know the buyer will live in the property. However, investors can be just as good stewards of properties as residential buyers.
 
If you are still unsure about whether to sell to an investor or a residential buyer, you should consult with a property professional who can help you weigh the pros and cons of each option.
 
Here are some additional considerations to make when it comes to selling your property:
  • Do your research. Before you start marketing your property, it's important to do your research and understand the current market conditions. This will help you set a realistic asking price and avoid overpricing your property.
  • Talk to a professional investment agent. A good investment agent can help you market your property to the right investors and negotiate the best possible price.
  • Be prepared to negotiate. Investors are typically looking for a good deal, so be prepared to negotiate the price of your property.
  • Be patient. It may take some time to find the right investor for your property. Don't get discouraged if your property doesn't sell right away.
 
Selling a rental property can be daunting, but it doesn't have to be with the right support. Our expert Investment Team are on hand to give you impartial advice to help you find the best buyer for your property, or guide you toward the best method of sale that works for your strategy.
 
If you'd like to have a commitment-free conversation with our team, give us a call at 01482 562 562 📞 Or connect with our Investment Consultant, Liam Dunn at liam@ultralets.co.uk or via his LinkedIn

Posted By

Ollie Potten


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