Property Buying Process
Will we buy a property from you? A quick check…
We buy properties that do not need any/much work doing before it can be let. So, we are not buying properties that, for example, need new kitchens, bathrooms, re-wiring, roofs, heating/hot water systems etc. We can however look at properties that only need redecoration or other cosmetic improvements, minor jobs etc.
We can only buy properties that enable us to keep future rents affordable (at or around current Local Housing Allowance/Universal Credit rates). That means if the asking price is too high, we will not be able to purchase. So, we always say, be realistic in your asking price if you want to sell to us!
The above will usually be the main reasons why we cannot buy a property.
What properties are we looking for?
Largely, we are looking for properties with 1-3 bedrooms, comprising of flats and houses. If you have a 4-bedroom property, we may look at this if the price is realistic, it’s in the condition stated above, and in a suitable area. We may also look at some HMOs, subject to the same conditions.
What areas are we looking to buy properties in?
Redcar and Cleveland, Middlesbrough and Stockton. In some cases, we will be buying in areas where properties struggle to sell, that means we will reflect this in any offer price we make. Over time, we aim to extend beyond these areas.
Our process for buying properties
Here at The Ethical Housing Company, we strive to make buying your property simple and fair, and to keep you informed throughout the process. A member of the Ethical Housing Company team will be responsible for ensuring the following steps are taken and manage the relationship with you.
Stage 1 – Property Identification and Inspection
When we identify a potential property to buy (whether we have found one or you have come to us) we will arrange for a preliminary property inspection attended by ourselves and possibly a third-party advisor. This is to determine whether or not the property is suitable for us to let.
If the property is not suitable, we will notify you asap with the reason/s.*
If the property looks to be suitable, we will give you a price bracket for a purchase price. We will ask you to confirm in writing that you agree to this price bracket. If you do not agree, the process will terminate here with no fees incurred by either party.
*If you are able to address the reason(s), for example, you offer to complete some repairs/maintenance that we require, then we may then be able to proceed.
Fees/Charges: None at this stage.
Stage 2 – Survey and Conveyancing (for all properties)
Upon written confirmation that you accept the price bracket, as above, we will then instruct our qualified surveyors and solicitors to conduct survey/s and conveyancing.
We will also ask you to confirm in writing that you don’t know of any reason that would prevent us from buying your property, for example a major structural/legal issue etc., before commencing.
Upon results of the survey and conveyancing, we will confirm in writing one of the following:
A definite offer to purchase your property, within the price bracket; OR
A definite offer to purchase your property, outside the price bracket, with reason why; OR
A rejection of the property, with reason why.
We will be open in our discussions with you and will always strive to make a purchase wherever possible.
If we have made you an offer, we will require you to accept this in writing.
Stage 2 – scenario a) for properties where there are tenants living in the property…
Where there are tenants living in the property, we will require a copy of the tenancy agreement, inventory, and we will need to meet with the tenant/s to determine some information from them during this stage. If we identify any restrictions on the tenancy agreement, or any other tenant-related matter that would prohibit us from buying your property, we will notify you asap explaining the reason.
Stage 2 – scenario b) for properties where you as owner are living in the property…
Where you are living in the property, we will require you to agree to a provisional date that you will vacate the property and to confirm that you do not know of any reason why you could not move within/by this time.
Fees/Charges: If you pull out of the process during stage 2, for example you change your mind, we will charge you £495. This will contribute towards our surveying and conveyancing costs. It is at our sole discretion not to charge this. We make offers to purchase, and instruct surveyors/solicitors, in good faith and ask you to act in good faith at all times too.
Stage 3 – Exchanging Contracts and Completion
Once we have received written confirmation that you accept our offer to purchase your property, we will then instruct our solicitors to draw up the necessary papers etc. You must use your own solicitors at your own cost to avoid any conflicts of interest.
Fees/charges: there is a £495 fee to pay when we purchase your property. This will be deducted from the monies to purchase your property upon completion. That means, the monies we transfer upon completion will be the agreed purchase price, minus £495. We believe this is notably cheaper than estate agents and so offers good value for money.
If you pull out during Stage 3, we will charge you £495, to contribute towards our costs. It is at our sole discretion not to charge this. As above, we expect all parties to act in good faith during the process.
If for any reason we are unable to proceed with the purchase, we will notify you asap with the reason, and will pay up to £250 towards any costs you have incurred upon receipt of valid proof.
We will aim to purchase a property within 6 weeks following our initial property inspection.
To do this we require you to cooperate in the process and ensure your representatives (e.g. your solicitors) act in a timely manner at all times to prevent unnecessary delays to the process. We ask you to notify us in advance if you cannot meet this timeline so we can plan accordingly. We will do the same.
Where we are buying multiple properties from you, we will look to reduce/waive fees wherever possible.
We may alter this process over the coming months, in order to improve and quicken our processes.