We’ve been featured in the September issue of Show House magazine, giving our thoughts on how PX can bring multiple benefits to developers.
Below is an extract from the interview we gave but the full story can be read here.
- What service do you offer the housebuilder in terms of part exchange?
Our PX schemes are extremely straight forward and transparent. We will consider any property type at any value, and we can typically provide a firm offer within 24 hours. We normally exchange contracts within 28 days and are extremely flexible on final completion dates. We can also take the stress out homeowner’s move by delaying vacancy for up to 2 weeks after completion.
In many instances, we have become an extension of our clients’ sales and marketing teams; working hand in hand to help them transact as many deals as quickly and efficiently as possible. Some of our developer clients are happy for us to deal direct with their customers, while others prefer to ‘white label’ our services.
It’s also important that we operate and structure deals in tune with our customers own commercial objectives, so we need to be flexible and adaptable. Most importantly of all though is the way they appreciate our responsiveness – it’s often said that we’re very easy to do business with.
- How does the housebuilder benefit by offering part exchange?
As soon as new properties are completed, developers need to secure sales on the plots as quickly as possible, and so one of their biggest frustrations is the delay in waiting for their new customers to sell their existing properties. This is compounded when the housing market is sluggish, as it currently is, and so Part Exchange becomes an essential tool for them to unlock sales – and without having to sacrifice their margin.
It also provides their customers with the certainty of knowing that the purchase of their new home is secured, without the hassle and stress of having to sell their existing property on the open market and the associated delays and fall-throughs that are all too common.
Developers also know, that by working with us, we will hand-hold their customer through the whole process, with the assurance of a successful outcome for all parties.
- Are housebuilders not opening themselves up to risk by offering PX? If the owner couldn’t sell the house, why would a housebuilder fare any better?
The beauty about working with Silverbridge Properties is that there are no risks at all for the developer. Once their customer has agreed to consider PX, we handle all the negotiations with them and, if they agree to the valuation price, we then purchase their property. When the sale completes, we then transfer the monies to the developer, often much quicker than if their customer had to sell on the open market.
It then becomes our responsibility to re-sell that property, working in partnership with our long-standing network of estate agents and private investors nationwide. And because there is no forward chain, the property becomes extremely attractive and far easier to sell on. It’s often the case that we are able to also complete on the sale around about the same time of the purchase.
- Are buyers now more receptive to part exchange? For example, do they feel like they are getting a fair price?
I think most people now understand that they will receive a lower price for their property from a PX sale compared to that on the open market, but we believe that there are far more positives than negatives. One of the major benefits is the promise of a guaranteed sale, which provides the homeowner with a quick, stress-free transaction without any delays or fall-throughs, giving them certainty on their next move. Selling through us also means that they pay no legal fees, nor estate agents fees either. It might even surprise many people to know that the difference in price, between a PX sale and through an estate agent, is just 7% (based on the current UK average house price) which is a very small price to pay for the certainty that PX provides.
- Is there a certain demographic that PX is more popular with?
The common denominator amongst our PX customers is that they are all adverse to uncertainty and stress when it comes to selling property. We find that they value the guaranteed sale that PX brings even if it does mean receiving a lower asking price. A large proportion of our customers, however, are in the 60+ bracket, since the majority of our clients are retirement developers but, as we’re now beginning to expand into the mainstream housing market, our customers are wide and varied in age and demographic.
- Are all properties suitable for part exchange? If not, how do you vet them?
We will consider any property type, at any value, and in any location. The only properties that we won’t deal with are those that have been condemned or deemed uninhabitable. Properties that have no mortgage attached to it, are naturally much simpler and quicker to transact but, first and foremost, were just guided by the needs of our developer clients.