Have you bought (or inherited) a derelict property?
Perhaps you’re worried or excited about what to do with it.
After all, can you sell it? And if so, where can you sell it?
Read on to find out.
What is a derelict house?
A property is classified as derelict if it meets the local council’s specific criteria, such as:
- Being vacant for an extended period
- Falling into a state of disrepair through neglect
- Being considered unsafe and uninhabitable in its current condition
- Having tax or mortgage arrears owed against it.
They might have broken windows, crumbling walls, leaking roofs, and overgrown gardens.
Derelict properties can vary from small cottages to larger houses. Sometimes they are even former commercial buildings.
They have one thing in common: the cost of fixing them up is high.
Derelict properties vs fixer-uppers
Houses in a bad condition (often called ‘fixer uppers’) are not the same as derelict properties.
Houses in bad condition are habitable and in need of decoration or minor repairs. By contrast, derelict properties are not.
What causes a house to become derelict?
The owner dies without heirs
If the owner of a home passes away and no next of kin exists, the property may remain vacant.
Without someone responsible for its upkeep, the elements will take their toll.
The owner goes into long-term care
Elderly homeowners entering residential care sometimes leave properties empty and unmanaged for years.
Companies may shut utilities off. Without maintenance, houses can become damp, decayed, vandalized, and at risk of squatters.
The owner suffers financial problems
Recession, job loss, or debt can force homeowners to abandon their properties.
These houses often then get repossessed.
Structural issues make the property uninhabitable
Serious structural problems include subsidence or flooded foundations. These can make a building too costly and dangerous to repair.
The owner may strip it of fixtures and fittings and abandon it.
Serious structural problems like subsidence or flooded foundations can make a building too costly and dangerous to repair.
The owner may strip it of fixtures and fittings and then walk away.
Over time, the cumulative effects of abandonment and neglect take an immense toll on any building.
Can you sell a derelict property?
You can sell a derelict property in the UK.
However, it’s unlikely to be as straightforward. Extensive renovation will be needed – not only the simple things you can do to sell your house faster.
Given the amount of work necessary, you should be prepared to sell at a sizeable discount.
But you can do it if find the right buyer or make essential repairs.
Finding a buyer who sees potential magic amidst the derelict property you want to sell may take up to a year.
Below are some other issues to consider.
You may need planning permission
Derelict buildings often need significant structural repairs. And planning permission is usually required before work can begin.
This brings costs and delays for buyers.
It can be challenging to get a mortgage
The scale of work combined with low valuation makes it a struggle to get a mortgage for a derelict property.
Most lenders shy away from them altogether. This restricts your market to cash buyers only.
The work costs could easily exceed the property value
Renovations required on derelict properties often outweigh the property’s value.
Buyer will need large budgets to take on this kind of project. They would be relying on adding value through refurbishment.
But because derelict buildings are high risk, listing prices can be negotiated.
For the right cash-rich buyer, this creates an opportunity to snap up a bargain.
However, they may still bargain for a large discount to account for the costs and risks involved.
How long does it take to sell a derelict property?
Selling regular houses usually takes around 25 weeks from listing to completion.
But finding a buyer brings additional challenges. On average, you can expect the process to take:
- It takes at least 3-6 months to prepare the property for sale. This includes asbestos surveys, checking for protected species, maximising curb appeal, etc.
- 6-12 months of being on the market before securing an offer. This factors in the time buyers need to cost up works, liaise with architects, and put financing in place.
- A further 2-3 months is needed to exchange, carry out surveys, and complete the sale.
So, you could be looking at anything from eleven months to almost two years to sell a derelict property.
The key here is being prepared for a lengthy sale process and having enough funds to cover:
- Maintaining adequate property insurance
- Securing, clearing and maintaining the site
- Paying your mortgage payments while empty
- Paying agent fees.
In short, selling derelict buildings requires patience and deep pockets…
Types of derelict property buyers
Cash-rich developers
The most likely buyers are specialist property developers. They are often experienced and carrying out extensive repairs and renovations.
Most extensively remodel derelict properties, maximise value, and sell them quickly.
Owner-occupier DIY renovators
Some brave owner-occupiers take on a derelict place as the ultimate DIY challenge.
They may eventually plan to live there, sell it or rent it out after completing renovations.
Finding a buyer with sufficient time, skills, and spare capital can take time and effort.
And they will still expect a bargain price to account for the significant work involved.
Investors are looking for demolition sites
When a derelict property is beyond repair, the land holds investment potential.
Some buyers might purchase to demolish the ruins to construct a new home from scratch.
Overseas investors
There is reasonable demand from overseas buyers looking for UK renovation projects.
For example, they may want derelict rural cottages to turn into holiday homes.
Sell your derelict property with We Buy Any Home
If you need to sell your derelict property quickly, We Buy Any Home can help.
We are a chain-free cash house buyer who can purchase your property up-front and quickly, without hassle or stress.
Using our funds, we will purchase your property at a set price by your chosen date and fully manage it from beginning to end.
Fill in our enquiry form below if you want a cash offer for your house.
