You might well be happy living there, but if your property lacks certain services, such as running water or drainage, or if it has significant issues, such as damp or leaks, then chances are it would be deemed unsuitable for human habitation, or ‘uninhabitable’.
When it comes to selling an uninhabitable home, you will inevitably run into problems, especially if you try to sell on the open market. Few, if any, mortgage lenders will be prepared to offer a mortgage on an uninhabitable home, so you’ll need to start by either fixing the problems, or finding an alternative way to sell.
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In this article, we’ll show you your options for selling an uninhabitable house and help you to decide on the best way forward so you can sell your home and move on, leaving all those problems behind you.
What happens when a house is deemed uninhabitable?
The first thing that will happen if your house is deemed uninhabitable is that mortgage lenders will stop offering loans on the property. That means that even if you can find a buyer who’s prepared to look past the problems and see the potential of your home, they won’t be able to get the money they need to buy it.
Unfortunately, there’s no formal definition of an uninhabitable home amongst mortgage lenders. Different lenders will use different criteria to assess whether or not to lend. The closest thing there is to a definition of an uninhabitable home is the UK Government’s Homes (Fitness for Human Habitation) Act 2018. This act applies to rented property, but it does give some indication of what makes a home uninhabitable.
A house may be deemed uninhabitable if it lacks a separate kitchen or bathroom, if it has structural issues such as damp, water ingress or significant subsidence, or if it doesn’t have a reliable supply of fresh running water. Any or all of these issues will make your home uninhabitable and make it very difficult to sell for its full market value through an estate agent.
Tempting though it may be, you can’t just stick your head in the sand and try to hide the kind of problems that make a home uninhabitable. Even if they’re not immediately apparent to potential buyers, they’ll be quickly spotted during a survey. You also have a legal obligation to accurately declare the state of your home on the TA6 Property Information form. If you don’t declare a problem and it is later discovered, you could be sued by the buyers for misrepresentation.
Common difficulties with selling an uninhabitable home
Just the phrase ‘uninhabitable’ will be a huge barrier in selling your home. The very least that most homebuyers want is a home that’s fit to live in and having this label attached to your home can be a real stigma. Here are some of the common difficulties that you may encounter:
- Difficulties in finding a buyer – wherever your property sits in the market, there will always be lots of competition from similar sized homes in your neighbourhood. This means that problem properties will struggle to attract buyers, even if they’re in a good location and have a good-sized plot. Whatever your estate agent may tell you, viewers will be few and far between, and those that are brave enough to view will soon be put off by the issues.
- Difficulties for buyers in getting a mortgage – as discussed above, most mortgage lenders will not offer a mortgage if a property is deemed uninhabitable. This means that buyers will not be able to proceed unless they have their own independent funds.
- Difficulties with surveys and EPC ratings – the kind of problems that make a home uninhabitable will always come up on a survey or affect your EPC rating. This will only serve to emphasise the problems and put buyers off.
- Problems with getting a fair price for your home – even if you do find a buyer, you can expect to get a very low offer for your home, often well below asking price. Even if you have ‘priced in’ the problems, or arranged to have repairs done, buyers will expect to pay much less than they would for a ‘normal’ home.
- Assumptions about other issues – simply getting quotes for repairs, or fixing the problems yourself, may not be enough. Buyers will often make assumptions about other areas of your home based on the established problems. Even if there are no other issues, most buyers will be wary of the possibility and assume that the whole house is in a similar state.
- Long selling time – a lack of potential buyers will inevitably mean that it takes longer than usual when selling an uninhabitable house. Even a standard property in good condition takes around five months or more to sell, and selling an uninhabitable home on the open market will often take much longer, if it sells at all. The longer a problem property takes to sell, the worse the problems will get, and you could find the value dropping further and further as time goes by.
- Repairs may not be worth it – once your home has the label of uninhabitable, it will carry that stigma for a long time, even if you spend time and money repairing it. However well the work is done, buyers will always choose a home that didn’t need fixing in the first place over one that has had to be fixed. That means that if you invest in repairs, you may not get your money back.
Considerations for selling an uninhabitable property
So, what are your options for selling an uninhabitable property, and what should you consider when thinking about your sale?
You need to think about what is most important to you: the speed and simplicity of the sale or the price you get for your home. This will help you to decide the best way forward when selling an uninhabitable house.
You have a number of options for an unliveable house sale, including:
- Repairing and renovating an uninhabitable house – If you have the time and the money, you could consider fixing the problems before selling an uninhabitable house. However, you need to be sure that you’ll get your money back in terms of increased value. You may also struggle to throw off the stigma of the property needing such repairs, and some buyers may see repairs as an indication that there may be other problems to come.
- Selling an uninhabitable house on the open market – as discussed above, selling an uninhabitable house on the open market can be extremely difficult, if it’s possible at all. Estate agents don’t tend to attract the kind of cash buyers who are prepared to take a risk on a run-down home. You could wait a long time to sell this way and have to accept a very low offer when you do.
- Selling an uninhabitable house at auction – auctions are a good place to sell an uninhabitable home. Auctions attract cash buyers, property developers and others in the market for a cheap property that they can fix up to either live in themselves or flip fast for an easy profit. However, auction sales take at least a couple of months, the fees are high, the sale prices are low and you may not even attract a buyer.
- Selling an uninhabitable house direct to a developer – you may be able to sell an uninhabitable property directly to a property developer, and often they will approach you to express their interest. However, you need to be prepared to take a very low offer, as the developer will want to cover their costs and make a profit when they resell your home.
- Selling an uninhabitable house to a cash house buyer – often, selling an uninhabitable property to a cash buyer is your best option. Cash buyers will buy any home in any condition as-is, including uninhabitable homes. Rather than waiting months and months on the open market, or hoping to attract a bidder at auction over two months or more, a cash buyer will give you a fair price for your home, with a fast and fuss-free sale in as little as 14days.
- Selling an uninhabitable probate property – if you have inherited an uninhabitable home, then you need to dispose of it fast before it starts costing you money to maintain it. You can sell a probate house to a cash buyer, but you need to get written agreement from all beneficiaries before you do, or they could sue you for not getting the best price.
Why would a cash buyer want to purchase an uninhabitable property?
Cash home buyers do not discriminate. The ‘we buy any house’ style companies will do just that, buying any house in any condition. But why would a cash buyer want to buy an uninhabitable house?
The simple answer is that in many cases, they are property experts. This means that they can see potential in even the worst homes, and they will have the tradespeople needed to bring the property up to scratch. Some cash homebuyers even have their own, in-house teams who can fix up a home for far less than it would cost to bring in contractors.
However, you need to understand that cash homebuyers are not charities, and they will want to do a deal that covers their costs and provides a little profit along the way. As a result, a cash buyer will always offer less than market value for your home. The standard offer is around 80% of the market value, but if your home is uninhabitable, you should expect significantly less than this.
This may not seem like a very good deal, but as we discussed earlier in this article, if you’re trying to sell an uninhabitable property, your options will be severely limited. At least a cash home buyer will give you a guaranteed sale, in a very fast timeframe, so you can cut your losses and start again somewhere else, without the problem property hanging round your neck. At the end of the day, getting something for your uninhabitable home is better than nothing. To see how much you could get, click the button below:
Expert Insight from Kelvin Elliott
Kelvin Elliott, founder and buying director of myhomebuyers.co.uk explains why uninhabitable homes are such a problem:
“Unless your uninhabitable home has something unique about it, such as a truly stunning setting or a remarkable history, then there’s simply no incentive for the average buyer to take it on, even if they can afford it. Add in the problems with getting a mortgage on an uninhabitable home, and selling on the open market becomes almost impossible.
“As a cash buyer, we don’t have to worry about securing a mortgage, so we can consider any home, in any condition, even uninhabitable ones. We understand the risks and rewards involved in this sort of property, and we can make a fair and reasonable offer for your home based on this.
“We’ve helped many customers who thought they were stuck with a home they would never sell. We’ve taken the problem off their hands, leaving them free to get on with their lives without those worries.”
To see what a cash buyer could offer you for your home, despite its current problems, click the button below for a free, no obligation estimate:
What makes a house uninhabitable?
There is no formal definition, but a house will be considered uninhabitable if it’s not watertight, if it lacks a separate kitchen or bathroom, if it has no running water or if there are major structural issues that make it unsafe.
Can you get a mortgage on an uninhabitable house?
No. Most mortgage lenders will not offer a mortgage on an uninhabitable house. You may find a specialist that does, but their interest rates will be extremely high.
Can you sell an uninhabitable house through an estate agent?
In theory, yes you can. However, without access to a mortgage, you’ll have a very limited pool of potential buyers. A traditional sale could take a very long time, with your property deteriorating further and losing value with every passing month.
What is the best way to sell an uninhabitable house?
The easiest way to sell an uninhabitable home is to sell to a cash homebuyer. These companies will buy any property in any condition and they have the experience and expertise to look beyond the issues. You could sell your home and be free of the problems in as little as 14 days.
Do cash buyers buy uninhabitable homes?
Yes, uninhabitable status will not put them off buying your home, in a fast, fuss-free sale. However, you should expect a lower offer than they would normally give for a standard property.
Conclusion
Selling an uninhabitable home can be a complete nightmare, with very little interest from buyers. What’s more, the longer it takes to sell, the worse the problems will get, making a sale even harder to achieve. This can feel like a vicious circle.
In many cases, it’s better to cut your losses and sell fast to a cash homebuyer. They will buy any property in as little as two weeks, so you can say goodbye to your uninhabitable home and all the problems that go with it.
To find a reputable cash house buyer, read our independent reviews here. To find out what you could get for your home in its current condition, click the cash offer calculator button below: