Page 3 | Advice on (trying) to sell flat in London

kleto · 2021-05-15T08:43:30+00:00

This is the first time I've tried to sell a property, and my head is spinning! I've had my 2 bed, zone 2, victorian terraced flat on the market for two months now. Dropped the price £50k, changed estate agents, done everything I can think of. Had one offer that fell through and maybe a total of 8 viewings. I know the market has changed dramatically since i bought it in 2015, but I'm not sure what else I can do to sell it. I keep hearing the market is really good and people selling up super quick, but not happening at all for me. I Really want to sell as my partner and I are moving out of the country, but at this point I'm trying to decide if I should just drop the price even more or rent. Wondering if others are having similar problems? If so, are you trying to wait out out and rent the property or dropping the price more?

Bloomsburyreader · 15/05/2021 23:12

I own a flat in London that I used to live in but I am not putting it on the market right now. Instead I am remortgaging it and taking out some of the equity and then just renting it out again.

These are the things I am doing/have done and I recommend you do the same so that when you do come to sell you get a decent price,

Right now on a 95 year leasehold you can extend without too much expense. Do this now. The standard leasehold granted is now 999 years and so when selling at 998 years or whatever when the flat market has bounced back, you will be able to advertise this and this will be a selling point. Leave it and your leasehold will reduce in rate Ans the flat will lose value/appeal.

When these tenants move out, get those kitchen cabinet doors spray painted/vinyl wrapped/replaced. They are dated and prospective buyers are young professionals who are going to be putting everything on a deposit and won't have money left over for a new kitchen so the state of the current one will put them off.

Before new tenants move in get decent photos done by your preferred agent and get them to keep them on file or just do them yourself! Stage it for being lived in but not cluttered.

When renting out a flat, unless you are paying very small mortgage payments each month then there is not a huge profit so the income thing is not normally a big issue so shouldn't be too much of a problem re the foreign income thing

Bloomsburyreader · 15/05/2021 23:14

Agree with living in the clouds re the boiler!

hyperbole001 · 16/05/2021 00:14

@Livingintheclouds

Ha - if you don't live in zone 2 or closer you can't comment on the value of the flats or size! This flat is slightly bigger than my two bed, and mine is worth over £700k, and if I was a mile east it would be over £1m. It's all location.

Surely you've just contradicted yourself with the above comment when you followed up with the below:

I don't know that area, but it seems looking at the other for sales, under offers and sold comparables they are under £400k, except for two. And the sold ones over that all have nice outside space.

And good luck trying to sell a two bed flat no larger than 600sqft for £700k in this market! Would have to be something special indeed.

korawick12345 · 16/05/2021 01:04

[quote hyperbole001]**@Livingintheclouds

Ha - if you don't live in zone 2 or closer you can't comment on the value of the flats or size! This flat is slightly bigger than my two bed, and mine is worth over £700k, and if I was a mile east it would be over £1m. It's all location.

Surely you've just contradicted yourself with the above comment when you followed up with the below:

I don't know that area, but it seems looking at the other for sales, under offers and sold comparables they are under £400k, except for two. And the sold ones over that all have nice outside space.

And good luck trying to sell a two bed flat no larger than 600sqft for £700k in this market! Would have to be something special indeed.[/quote]
'And good luck trying to sell a two bed flat no larger than 600sqft for £700k in this market!'

I just have to assume you are not familiar with London! @Livingintheclouds is pretty much on the money IMO

OnceUponAThread · 16/05/2021 01:31

I disagree with people saying it's really small - I think it's a pretty standard size for two bedrooms in London. It's a nice flat and a decent area.

BUT. One thing worth considering is the LISA house price limit is £450k, so at £495k you've priced out any first time buyers with LISA savings.

So you're looking at landlords (tricky market ATM) or people moving up the property ladder.

Unfortunately I think most people moving up the ladder who have equity will be looking for bigger (more expensive) properties with outside space.

So that means you're basically only looking at landlords. With that in mind, a two-bed is tricky for prospective landlords (not big enough for house shares, lots of single people can't afford a two-bed, who are they marketing it to?).

Still. It's not impossible. I think the fact you have tenants in place will be holding you back and it will be more likely to sell when they are gone. And you probably want to strip back the decor in line with standard landlord aesthetics (less for tenants to damage).

squee123 · 16/05/2021 08:08

Bear in mind that the rental market is pretty rubbish in London atm because lots of young renters have moved back to their families during covid to save money. Quite a few of my friends have had their tenants negotiate a lower rent over the last 12 months or had to relet at a loss

squee123 · 16/05/2021 08:09

Sorry meant lower rent

howtocomplain · 16/05/2021 08:20

The biggest issue is the tenants, second is the lease. Solve these and it'll be a very different prospect for buyers. I wouldn't touch a place with tenants with a bargepole.

Just being vacant might be enough, if you have time to play with maybe see how it goes once the tenants leave and extend the lease only if it doesn't sell then.

EverythingRuined · 16/05/2021 09:46

I wouldn't buy any leasehold flat at the minute. I'd wait until the new legislation about extending lease terms kicks in. (I'm not sure if it has already or not) I'd want a 990 year lease.

GOV.UK INFO

"Government reforms make it easier and cheaper for leaseholders to buy their homes"
"Millions of leaseholders will be given a new right to extend their lease by 990 years"

YellowFish12 · 16/05/2021 11:21

Yah it’s just a difficult type of flat to sell in this market.

On the small side for a 2 bed
No outside space
Slightly dated
Cluttered
Difficult price point above LISA savers threshold
Tenanted
Quite standard and mundane - nothing ‘wow’ about it

If you want to sell ASAP you could drop to. 450.

My advice would be to take it down, wait until the tenants have left and go in there and give it a bit of a face lift and stage for selling. Or just re-let.

Pinkdelight3 · 16/05/2021 12:42

It looks like you're on with two agents, which always makes me a bit suspicious about a property. Just stick with one if possible.

WombatChocolate · 16/05/2021 13:57

I would actually take it off the market now and wait u til the tenants have gone. Then do the small amounts of sprucing up, have the photos re-done, check prices at that point and re-list.

As a LL, I know that you shouldn’t try to sell a tenanted property unless to another LL and you know you’ll easily find one. Here, it’s the worst of all worlds, it’s tenanted, so there’s no certainty the tenants will actually move out (have you given formal notice or are you just expecting them to go...they don’t need to go until 6 months after S21 issued and even then if they choose not to go, they aren’t obliged until the legal process to evict them has been completed...can take a year) so I would never offer in a tenanted property, even when the owner said the tenants were about to go....you just cannot know this.

So as a LL I need vacant possession before trying to market it. Yes, this can mean lots of months of no rental income, but you have to know that is the reality before becoming a LL.

The flat itself looks okay to me and the size isn’t especially small. It is very cluttered which is often the case with pics in tenanted properties, so when they go, get new pics taken of it either empty or ideally staged with a few carefully selected pieces to show there’s room for a table and also a desk etc as well as beds, but without all the ‘stuff’.

That lease isn’t terrible. You can include in the particulars that an extended lease will be provided on completion as currently you need to have had the property 2 years before extending but a current owner can launch the process and pass it new owner. What is your ground rent and is it escalating? These will determine how much it costs to extend. Even if you don’t intend to extend the lease, put the ground rent on the particulars, as people want to know this stuff. Also put the lease remaining length on particulars.

Nice flats still will sell, but you need to remove all obstacles to sale and the tenants are a BIG obstacle.

smallgoon · 16/05/2021 14:19

@EverythingRuined

I wouldn't buy any leasehold flat at the minute. I'd wait until the new legislation about extending lease terms kicks in. (I'm not sure if it has already or not) I'd want a 990 year lease.

GOV.UK INFO

"Government reforms make it easier and cheaper for leaseholders to buy their homes"
"Millions of leaseholders will be given a new right to extend their lease by 990 years"

Can somebody explain whether having a 990yr lease effectively means that you own the property (as the from that link seems to assume so)? What if you're in a block of flats and have a share of the freehold, does it mean you'll just continue to have a share or own your flat outright? And if you own the flat outright, what would that mean in turns of a service charge and obligations that are set out in the lease? The government reforms specifically refer to the ground rent, which for many of us is actually nominal (mine is £100 a year).

Porridgeislife · 16/05/2021 15:32

A 990 year lease is a virtual freehold when the ground rent is a peppercorn amount. The government back-pedalled this week & it appears that the proposed reforms don’t cover existing leaseholds - only new leaseholds in the future so wouldn’t apply to this flat.

Whether leasehold, common hold or share of freehold, you’d still need to pay a proportionate share of service charge to cover communal running costs & repairs.

Share of freehold can be a bit of a nightmare in a Victorian house as when one owner doesn’t want to spend money on repairs or redecorating, you’re at their mercy. On my street it’s fairly obvious which buildings are held share of freehold as their external decoration is long overdue, front steps in need of re-tarring, etc.

mobear · 16/05/2021 17:01

I don't see the point arguing about London property prices. They're all over the place and vary so much area to area. My small 1-bed with a garden in Zone 4 is worth a little over £400k. Intellectually, a larger 2-bed in Zone 2 should be worth a lot more but that's not how it works.
The best thing to do is look at recent sale prices in your area to determine what your property is likely worth, adding and subtracting for plus and minus points.

Diamondnights · 16/05/2021 17:18

I'm looking to buy a flat in London (though a bit further east). This looks a nice flat and it seems the right sort of price. The only thing I would say is that it looks very cluttered which to someone who doesn't know the circumstances, suggests lack of space/ storage. If you can, wait until your tenants move out and then remarket it a bit more minimalisticly?

TakeYourFinalPosition · 16/05/2021 17:26

(and I hate exposed boilers - put a cupboard around it)

I’m not the OP but we and our boiler changed by Worcester Bosch last year and they told us this was not allowed anymore. They wouldn’t fit the boiler unless we let them remove the cupboard, and when we checked this, we were told we could put a cupboard around it if we lived here but we’d need to remove it for every service, and we couldn’t put a cupboard round it if we let the flat out... so we haven’t bothered.

To be honest I’ve got used to it, and it’s a small, new boiler so it looks fine, but I’m not sure cupboards are allowed round them anymore!

DeadHouseBounce · 16/05/2021 18:40

@earsup

If you can drop the price to make it the most cheapest then it will sell...i would also extend the lease to a longer period....its early days with the flats and houses property cycle....i would maybe let it out for another year and see what happens.... lots of new build flats near me are all unsold yet loads more going up...some one must buy them eventually !

Drop the price, that is the sticking point.

howtocomplain · 18/05/2021 10:40

I don't think the OP should drop the price until she's tried to sell it empty.

I mean, I'm sure there is a price point at which a tenanted place becomes attractive because it's so cheap, but it's not the smart move if the OP wants to make money!

First, she should get rid of the tenants (and re-list with less cluttered pictures) as the tenants will be putting loads of buyers off.

Meanwhile she should look up the cost of extending the lease, and then if it hasn't sold without tenants, decide if her next move is to pay to extend the lease or drop the price.

Twiglets1 · 19/05/2021 08:29

@kleto

Thanks for the responses so far! A bit more information .. I currently rent out the flat - i have for 2 years, but my tenants are moving out. Here's the link - www.rightmove.co.uk/properties/105793751#/

I think the photos are ok, but shows it furnished with their things and they have a lot of stuff! So not sure that's helping matters.

No cladding issues for me, but i don't have a garden which I know is a problem.

Just really want to sell and move on, but it's not looking like a great option.

Thanks for your help!

I think it looks like a lovely flat and have seen quite a few as currently viewing flats with daughter looking to buy in Hackney.

Turn offs will be the tenants and lack of outside space. We have found that with tenants in situ they don't tidy up for viewings like owners would do. And sometimes they have made viewings difficult for us or cancelled at last minute as said they have work calls - a problem is a lot of people are working from home at the moment.

I think you will sell easily when the tenancy comes to an end. It really does look like a nice flat with plenty of natural light and close to public transport.

UpTheJunktion · 19/05/2021 08:55

Take it off the market and te-market once the tenants are gone.

You don’t want a long date since it was listed and reductions showing so best to start afresh tenant and clutter free.

I only viewed tenanted properties where the tenants had exchanged contracts in their first bought flat and were in the process of moving.

GETTINGLIKEMYMOTHER · 19/05/2021 09:05

As someone who’s fairly familiar with the London flat market, IMO for that sort of flat, it looks very nice, OP.

I do agree that the blurb should include length of lease, assuming it’s not share of F/H, which should be stated anyway. It’s very irritating when EAs don’t include such basic info. Adding the ground rent and maintenance charges (if any for this type of flat) would be good - usually considerably cheaper than for flats in blocks.

Personally, apart from decluttering and obv. any necessary cleaning to shiny spotlessness and touching up of any paint chips etc., I wouldn’t bother with anything more - it’s unlikely to be worth the cost and hassle.

Plus, as pps have said, waiting until tenants have left would be preferable. Some people (not to mention mortgage lenders) will always be put off by the worry that they will refuse to leave.

There’s nothing you can do about lack of outside space, but there will always be some people who aren’t bothered. Given the state of the market at the moment, I’d think it’s down to price - so a lot will depend IMO on how much you’re prepared to drop, and how quickly you want it sold.

kirinm · 19/05/2021 09:57

I can't tell from the photographs if there is a lot of storage but having rented two bed flats with no storage, we chose not to underestimate how important storage is and had built in storage added in the alcoves. The difference it has made to the flat is immense. It really has changed the way it looks and it feels so much more spacious.

I think the size of the flat is fine - ours is pretty much the same. I own share of freehold and won't ever buy leasehold if at all avoidable as we've had enough issues with the other freeholders to be put off leasehold for life but 95 years isn't bad either.

I don't know the area but is it priced to reflect the work that buyers are going to want to update the kitchen and bathroom?