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Our friends at Property Road, who have featured in The BBC, The Guardian, Forbes and more, have written a helpful guide for our members highlighting their top 5 tips for buying a repossessed property in 2023.
As many people know, property prices in the UK have shot up over recent years. While there is often talk of prices stabilising or coming down, for many people, the average cost of a home is still way too high, relative to their income.
Rising living costs and inflation have also made it difficult for many to buy property these days, but one of the things that you can consider is buying a repossessed property.
When interest rates shoot up after a long period of being at rock-bottom levels, such as in what happened in 2022, many people find that they can no longer afford their mortgage repayments.This is a sad situation and leads to many homes being repossessed as a result. However, it does provide buyers and investors with the opportunity to purchase a property at a much lower price, and this is something that many may be planning to do in 2023 given the forecasts relating to repossessions.
In this article, we will provide some of the top tips for buying a repossessed property in 2023.
As with any property purchase, buying a repossessed house is a big step. This is why you need to ensure you do your research before you take the plunge.
There are many key factors that you need to bear in mind, and you need to remember that some repossessed properties might need a huge amount of work, which means more money. Finding the right repossessed property can, however, provide you with many benefits.
Some tips that can help you if you are considering buying a repossessed property in 2023 are:
One of the things you need to do is to look at the options for finding repossessed properties. The more options you consider, the better your chances of finding the ideal property for your needs whether it is for yourself or as an investment.
Traditionally, people have bid at auctions for repossessed properties, but looking through the listings on multiple auction sites can become time-consuming.
These days, some estate agents also hold lists of repossessed properties for sale, but they do not advertise them on the open market. So, if you want to consider this as a means of finding the ideal property, you need to keep in close contact with the agencies to find out what they have available.
One of the other simple solutions you can consider is to use an online portal, as these generally bring repossessed properties from a range of platforms onto one portal. This then makes the process far easier and quicker for those who are keen to buy a repossessed property.
Another thing you need to think very carefully about is whether you want to spend a lot of money after making your purchase to bring the property up to scratch.
Many repossessed properties need to have extensive work carried out on them, and often this is not carried out pre-sale because the aim is to sell the property as quickly as possible. While the condition of the property is often reflected in the much lower price, you need to ensure you consider how much more you might have to spend to carry out renovations.
So, it is important not to be swayed and tempted by the low price of the property without first looking at how much you might have to spend after making the purchase.
You also need to look at your finances if you are considering buying a repossessed property in 2023. This will help to determine how much you can spend, whether you will be able to afford the type of property you want, and how quickly you can make a purchase.
If you are an investor or you have the available funds, you might be in a position to make a cash offer. This is fairly common with repossessed properties because the price tag is far lower than standard properties and the seller is usually looking for a quick, uncomplicated sale. Some might even specify cash buyers only, so this is something you need to look out for.
This is particularly true when buying from an auction where you’ll need to have the funds to buy the property already in place at the time of the auction.
The property industry moves very fast, and houses can be snapped up before you have even had a chance to make an enquiry.
With repossessed properties, competition can be fierce, so you need to ensure you are in a position to move quickly if you need to. With this in mind, you should do as much preparation as you can beforehand so you are ready to hit the ground running if the right property comes along.
This means planning ahead in terms of thinking about the type of property you want, how you will raise the finances, and how much work you are prepared to do on the property, among other things. If you’re buying at auction, always read the legal pack to ensure you understand exactly what you’re committing to if you’re the successful bidder
One of the other things to think about if you are buying a repossessed property is the location you wish to buy in. The values of properties in some parts of the UK are significantly lower than in other parts. This means that you may find it easier to get repossessed properties within your budget in some areas compared to others.
If you are buying a repossessed property to rent out, you have more flexibility with regard to where you purchase the property. However, if you are buying the property as a home, you need to consider whether you are prepared to move to another area in order to access lower prices.
There is no doubt that buying a repossessed property in 2023 will give you the chance to snap up a bargain whether it is as an investment or a home.
However, it is crucial that you do not rush into decisions, you are properly prepared, you are aware of the risks, and that you do as much research into the market as possible. Always consider your options and think carefully about the type of property and the area you want to invest in.
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