If you’re having a hard time trying to sell your commercial property, this guide will explore the key reasons why it has remained unsold.
Whether you are dealing with commercial estate agents or selling it yourself, selling a commercial property is much more difficult than selling a residential property, as there are numerous legal obligations to fulfil.
We list the top 3 reasons your commercial property may be struggling to sell:
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You can market the property with a commercial estate agent of your choice, but it is important to make sure that your agent understands exactly what you are looking to achieve.
It can be useful to provide your commercial estate agent with the initial relevant facts to assist in marketing your commercial property. Your agent will normally add detailed descriptions and photographs. However, bad-quality photography and inaccurate descriptions are unlikely to interest potential buyers, and you may find your business property doesn’t sell as quickly as you expected.
Unrealistic asking price
The amount your commercial property is worth is dependent on a range of factors, including:
The price of recently sold properties in the surrounding areas
If the commercial property you want to sell is in a run-down or unappealing area, it will be valued at a similar cost to the buildings that surround it. Buyers, investors and developers looking to build on the plot would consider the overall potential profit before committing. Your business premises may, therefore, remain unsold.
With Brexit taking over the news in recent years, a buyer may not be interested in your commercial property until there is more clarity on the market share and the growth or decline that the market may face. A buyer wants the lowest possible offer, so if you want to sell now – and fast – you may see little interest. If you are trying to sell an office building, it might be tricky because of the lack of demand from buyers, as office workers are now working from home. Have you considered whether to rent your commercial property instead of selling it?
Availability of similar properties
If competition is fierce and there are many similar commercial properties that aren’t selling in the same location – what are the chances of your property selling?
Condition of the property
If there are issues with the condition of your commercial property, estate agents won’t be able to make it right for you. To get a higher price and successful sale, you’d have to fix the damage, spending more money on the building to make it look appealing to a buyer.
When a commercial property is run down and dilapidated, it can be hard to shift. Many buyers won’t want to move into a shop of office and have to do extensive structural renovations as their initial investment may only cover cosmetic improvements, furniture, signage and shop fitting.
Is it legal to live in a commercial property if I can't sell it?
Some sellers have asked us if it’s legal to live in a commercial property or on the land, but this can cause real problems and leave you with very limited options.
If a building is still a registered commercial property, you may need to obtain planning permission before converting it into a residential space. You will need to apply to your council’s local planning authority (LPA). The approval may be granted subject to a limited time frame to complete all the building works. This depends on the type of commercial property you are converting.
Beware: if you go ahead with any building work without having permission, you may find yourself facing the financial and legal repercussions of a planning breach.
If you intend to convert a commercial property to live in, make sure you know exactly what the law stipulates before beginning renovations. There are guidelines covering electrical safety, heating and ventilation, plumbing, drainage and sanitation.
Local Authority Building Inspector
You should also seek prior approval from your council’s Building Inspector (part of the Local Authority Building Control team) before completing any major building or electrical works, even if they ultimately reaffirm that you are safe to go ahead.
Can I sell my commercial property for cash?
Many commercial property sellers skip the traditional method completely – cutting out legal costs, lengthy written contracts and time-consuming processes.
In 2023, sellers are moving towards commercial property-buying companies to save money and sell their businesses fast for cash.
Benefits of selling commercial property to a cash buyer
Here at Property Saviour, we guide you through the selling process and continue to stay in touch day to day. We have strong values – firmly believing that selling a property should be hassle-free and efficient, and we aim to get you the best price possible.
Although you must always make an informed decision based on your own personal and financial circumstances, the advantages of selling commercial property to a cash buyer are many:
- No long waits for commercial agents to find you a buyer
- You save on rent, business rates and utilities by disposing of the asset quicker
- We advise you on legal issues such as structural defects, squatters and lease irregularities
- You are free to move on with your life without the ties of property you can’t manage.