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Can I Sell a House with Negative Equity?

Negative equity is the term used to describe a home that is worth less than the mortgage secured on it. If you’re in this position, selling your home at a good price on the open market wouldn’t raise sufficient money to pay off your mortgage.

If you don’t have the means to pay the difference, there’s a good chance you’re stuck in your property indefinitely. That’s why we’ve put together a list of potential options. Yes, you can sell a house with negative equity — but is it the right move?

Speak to your mortgage provider

If you’re happy to remain in your home and can afford the mortgage repayments, negative equity might not be a major short-term concern for you. However, if you want to move, you might need to take a proactive approach.

Reach out to your mortgage advisor and ask about transferring your mortgage to another home. A lot of lenders will transfer the mortgage to a more expensive property if you sign up to a larger balance.

Sell a house with negative equity Sell a house with negative equity

Alternatively, you might be able to make overpayments on your mortgage without incurring penalties. This is usually the quickest way to get yourself back into positive equity. You should be allowed to pay off at least 10% of your balance early without incurring penalties. So if you can unlock savings or investments elsewhere, this is a good option.

Stay at home

The simplest and cheapest option is to ride things out. If you’re in negative equity, it’s probably because of a sudden decline in the local property market. These things tend to right themselves over time.

If you’re happy in your property and have no problem paying your mortgage, wait until the market recovers. If you don’t have to worry about repossession, you can ride out the storm and wait for local house prices to recover.

Negative equity only becomes a significant problem when you can’t afford repayments, or you need to sell your house fast.

Increase the market value of your home

Three things get you out of negative equity: debt reduction, rising house prices and an increase in the market value of the property.

Take a look at the houses for sale in your area. What do they have that your home doesn’t? In many cases, you’ll be able to improve your house without a huge cash outlay. A few enhancements or repairs might add a couple of thousand to your home’s market value.

Rent out your property

So, you can’t afford to move home, but you need to leave as soon as possible. Perhaps you’re struggling to keep up with mortgage repayments. Or maybe you need to relocate for a new job. In either case, negative equity could be holding you back.

In these circumstances, the most logical decision is to rent out your home. You can use the income to pay off your mortgage or any debts secured on your home. You might even be able to turn a profit. Renting gives you breathing space. House prices always recover eventually; you just need to be patient.

Take out a loan

Sell a house with negative equity

If the negative equity in your home is relatively modest, an unsecured loan might be enough to make up the difference. Make sure you get a good rate of interest, and that you can comfortably afford the repayments. But beware: this type of borrowing is always more expensive than securing a loan against your property.

Sell as quickly as possible

Check with your mortgage provider about the best way forward. But if you’re in serious financial difficulties, you might need to ask about selling your home as quickly as possible. Some lenders will accept repayment programmes after the property is sold.

If you need to sell a home quickly to alleviate financial problems, Flying Homes can help. We buy homes directly from owners for up to 100% of their market value. If the circumstances are right, you could have the proceeds of the sale within just a few days.

Can I Value My Home Accurately?

You don’t have to hire an estate agent to sell a house in the UK. But remember: a local agent brings an array of skills to the table — including experience in valuing homes.

Are you asking yourself “can I value my home accurately”? You can certainly value your property with a degree of accuracy, but you’ll need to know what you’re doing.

We’ve broken down the steps to valuing homes in the UK. But bear in mind this isn’t an exact science. And even the most talented and experienced estate agents get it wrong from time to time.

Is the house in a good state of repair?

Most homes can be valued according to their location, size, facilities, number of rooms, floor space and nearby amenities. But all of this data could mean very little if the property in question is suffering from serious structural issues. Before you do anything else, establish if any of the following issues are present:

  • The quality of construction is low
  • There’s damage due to subsidence
  • There’s damage or warping on the roof
  • There’s visible structural degradation
  • The windows are in a state of disrepair

Value a home that needs repairs

Are the house’s facilities fit for purpose

Every home relies on power and water. And when these essentials are interrupted or disrupted in any way, the consequences on the property’s market value can be devastating. Among the most common issues to look for include:

  • Unusually high water and energy bills
  • A malfunctioning boiler or central heating system
  • Restricted access to cut-offs and stopcocks
  • Outdated wiring and gas piping
  • Badly heated rooms

Your property might be in a fantastic area in high demand among buyers. But if it’s afflicted by some of these issues, you’ll need to address them if you hope to maximise your home’s price potential.

Of course, you may not have the time, money, or inclination to update your property. You might simply want to find a willing buyer as quickly as possible. And that’s where Flying Homes can help.

We buy houses directly from buyers without fuss or delay. There are no negotiating on price, marketing, property viewings or protracted conveyancing issues to deal with. If you accept our offer, we take care of everything. And in many cases, we’re able to release funds within just four or five weeks of making an initial offer.

Research recent house sales

The internet has made valuing UK homes easier than ever. Using the Land Registry website, Zoopla and Rightmove, you can search for recent house sales in your area. You can even search for homes that are similar in size and style to your own. This gives you a clear idea of what people are prepared to pay.

Recent house sale prices affect the value of your home

But there are many variables at play, and it’s impossible to be wholly accurate with your valuations. For example, a similar home that sold recently may have had a slightly larger garden. Or it might have newly-fitted windows. Any information you glean from these sites will only ever give you a rough valuation.

Can I get a more accurate valuation?

The tips listed above are used by the vast majority of estate agents in the UK. The current condition of a property together with recent sales data (and maybe a little intuition) are the key components of any valuation process.

If you need something more accurate, however, there is an alternative. Approach a surveyor and ask for a “standard valuation”. They’ll use all the data available to you online, but they’ll cast an expert eye on structural issues, too.

Valuing a home isn’t rocket science, but doing it with a high degree of accuracy is very difficult. If you’d rather skip the traditional house selling process altogether, get in touch. At Flying Homes, we buy houses fast, directly from their buyers. We’ll make you a fair offer based on market conditions. And if you accept it, we’ll take care of the entire transaction.

4 of the best ways to sell a house in the UK Today

We look at the best ways to sell a house in the UK today.

The best ways to sell a house in the UK are usually via a traditional estate agent, privately yourself, through online estate agents (cheaper) and of course, selling fast for cash to a property buyer.

Selling a property in the UK can be a complicated process, and is further complicated further if buying another simultaneously.

The different ways to sell a house

We look at the various methods below:

1. Selling a property via an Estate Agent

The traditional process of the sale of your home in the UK involves appointing an estate agent on the high street. However, with the growth of the major property portals such as Rightmove & Zoopla, purchasers look online to source a home to buy. Therefore it’s no longer necessary to pay an expensive high street agent. Cheaper online-only agents are available allowing people to sell their home without the expense of hiring an agent.

2. How do you sell your house privately?

Do you want to know how do I sell my house privately, is it a good idea? Selling a home yourself is a gamble, but could be an excellent way to sell. However, going it alone then the process requires knowledge of how the housing market works, knowledge of the local market, negotiating skills, a network of contacts and lots of time. If you possess these attributes then take this course of action and go it alone, this is usually the best way to sell a house yourself – otherwise, you run the risk of achieving a disappointing sale price.

3. Sell your home using online estate agents

How to sell your house via an online agent. If you want the expertise of a property professional without the fuss, there are online estate agents that manage the sale of a home remotely. While these services lack the personal touch, they are useful for getting the word out about your house to a large target audience very quickly. If you decide to take the estate agent route, you should research the track record and suitability of the agents considered, and you will also have to decide whether to stick with a single agent or use several. Check online, google ‘how to sell your house – online estate agents’ and you’ll get plenty of results.

4. Sell your home quickly via property buyers

It is also possible to bypass the UK property market altogether by selling your home to a property buyer –  house buying specialists. You will get an offer based on current market conditions, and you can leave the sale of your home in the hands of others. This way of home selling cuts out the need for marketing, advertising, property viewings and price negotiations so that you can save both time and money. Then there is also the opportunity value of you able to purchase another home with the certainty of a guaranteed sale in the bag enabling you to compete with other cash buyers when bidding on another property. Selling to a cash buyer is the fastest way to sell a house.

4 ways to sell a house - Infographic

If you’re in any doubt about the best ways to sell your house, then it’s probably best to at least consult with a professional and read reviews before making a decision.

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