Can you sell an unfinished house?

Picture demonstrating if you can sell an unfinished house?

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If you have asked the question, “can you sell an unfinished house?” then you have found the right article. While the idea of selling an unfinished house may not be straightforward, it is certainly possible. Indeed, there are many people struggling to acquire traditional property that may welcome the idea of finishing your house to their taste. Whatever stage of building you are at, the key to maximising the selling price is to sell the dream. If you can sell the dream and get buyers interested, you have a pretty good chance of selling your property.

Lack of finance is always a common problem

Running out of Money Before Selling an Unfinished House

One of the main reasons those with ambitious plans to build their own house sell before they are finished is a lack of finance. There are numerous ways in which to raise finance for a self-build, such as:-

  1. Savings
  2. Family and friends
  3. Self-build mortgage
  4. Sale of existing home

As a rule of thumb, many people believe that you should work out your budget and then times by 1.5. While this comment may be rather flippant, it probably won’t be too far wrong with many people struggling to finance their self-build homes. We will now look at the stages of building a house which will demonstrate the many challenges.

Stages of building a house

Stages of Building a House

When building a house from scratch, there are numerous different stages to consider. While many unfinished houses may have previously been acquired, at various stages of the development, the process is the same. Consequently, you may be forced to sell an unfinished house as early as the land acquisition or as late as the snagging process.

When you see the various stages in isolation, this gives you an idea of where and at what stage you may experience difficulties. It is vital to beware of potential challenges so that you are as prepared as you can be.

  1. The design of your home
  2. Purchase of land
  3. Preparation of land
  4. Lay foundations
  5. Building the house superstructure
  6. Adding the roof
  7. Exterior and interior fittings
  8. Electrical and plumbing runs
  9. Drainage and external works
  10. Prepare ceilings and walls
  11. Internal carpentry
  12. Wire up electricals and connect plumbing
  13. Decorating
  14. Landscaping
  15. Snagging

We have simplified the process – each section includes many different activities – but it does put the challenges into perspective.

Stages of renovating a property

Renovating a Property

As the cost of houses continues to rise, many people are now looking at renovating their current homes. Unfortunately, what can often begin with a relatively affordable budget can sometimes quickly spiral out of control. Consequently, homes with unfinished renovations tend to appear on the property market fairly regularly.

When looking at renovations, there are several stages to consider, which include:-

  1. Acquiring the right property
  2. Planning permission
  3. Gathering trustworthy tradespeople
  4. Funding
  5. Timetable
  6. Begin the renovation
  7. Snagging

While a new build/self-build is a much larger project, it is essential to realise that renovating a property can also be challenging. Of course, funding is crucial, but there are many other issues to consider. You may have to sell an unfinished house unless you retain control of timing and budget.

Common reasons why people don’t finish their home

Reasons why Property is Unfinished

If you ask anybody that has built their own home whether they would do it again, the vast majority would probably say no. What often begins as a romantic pipedream can, for many people, turn into a financial nightmare and leave them stranded. In theory, selling an unfinished home should be challenging, but this does not mean you can’t maximise your return.

Before we look at maximising the sale income of an unfinished house, it is worth reminding ourselves of the most common reasons why people don’t finish their homes:-

Substandard planning

If you have limited experience in building or renovating a home, you must take advice from the experts. While the TV property shows might make it look easy, those appearing on these shows likely already have a degree of experience. The key to any successful project is planning, planning, and more planning.

Poor planning puts the quality of work at risk, and it would likely put at risk the budget. Any increase in the funding may be challenging to finance, and you may suddenly realise you are in over your head. A slight increase in expenditure at the start of the project could signify a sign of things to come. The last thing you want to do is sell an unfinished house!

Lack of project management

There is no excuse for poor project management today; we have smartphones, email, and other electronic devices/services. Whether a complete rebuild or a renovation of an existing house, it is vital everyone knows the chain of management. It is also critical to ensure that all parties are kept abreast of the overall situation with particular emphasis on their area of speciality.

Electronic communication is also helpful in the event of disagreements and potential legal action further down the line. All communication needs to be clear, concise and focused on the particular issues.

Expansive scope

While many self-build/renovation projects will involve a degree of change further down the line, the initial criteria must leave participants in no doubt. Very often, disagreements will emerge between builders/suppliers and the homeowner concerning what had been agreed. It can be difficult to prove that a specific party was at fault unless there is evidence.

Whether as a consequence of confusion, or a change from the original plans, many people find it difficult to raise additional finance to fund these new expenses. Consequently, having maxed out all available avenues, unfortunately, there is often only one solution remaining, selling that dream home before it is even finished!

Lacklustre productivity

When obtaining an initial quote for building/renovation work, an assumed level of productivity will be factored in. Consequently, holidays, sick days, and inexperienced employees can very quickly make a difficult situation even more challenging. Reduced productivity will ultimately mean that the project takes longer to finish, often at great expense to the homeowner.

Again, this is one of those areas where many people will try to cut costs to the bone, often using inexperienced tradespeople instead of a more expensive experienced specialist. However, it is also important to remember that substandard work would likely be rejected by the property inspector and could put you in a tough situation.

Burying your head in the sand

The idea of building your own dream home is romantic and can, in many cases, be financially rewarding. But unfortunately, history tells us that far too many people ignore the challenges while focusing on the positives. Yes, there is no problem in being positive, but you also need to take a balanced view of different opinions.

If red flags emerge during your project, you must address them sooner rather than later. As many will testify, it is unlikely that they will go away without intervention.

Change in personal circumstances

While many couples strive to create their dream home, this can impact their living environment and finances for some time. This added pressure has created friction within relationships on numerous occasions, and families, unfortunately, can fracture. In this scenario, where the combined finances of both parties are separated, it can lead to a forced sale of an unfinished house. It is difficult to understand the pressures that can often follow until you begin such a project.

Running out of money

As we touched on above, it is scarce for any building project to come in under budget and on time. Consequently, if you want to build a new house or renovate an existing property, you must leave yourself some headroom. This means that if additional funding is required, it is available. Those who push the limits of their finances from day one are unlikely to finish the project. So expect the unexpected, and you probably won’t be disappointed!

Valuing an unfinished house

Valuing Before Selling an Unfinished House

If you spoke to 10 people, they would likely give you various opinions on how to value and sell an unfinished house. However, the consensus seems to be:-

Potential finished value – Cost of work to be done – Less a discount (time, inconvenience, etc.) = Purchase price

A quick perusal of similar properties in the area will give you an idea of the potential finished value, and obtaining two or three quotes will confirm the cost of work to be done. It is the discount which is difficult to pinpoint as it can be impacted by an array of issues such as:-

  1. Amount of work left to do
  2. Quality of work done so far
  3. Outlook for the housing market
  4. Funding

While buyers may be able to obtain a self-build mortgage, those who have had to call a halt and sell their homes unfinished will likely be running short of capital. Consequently, sellers may well prefer a cash buyer, which can again reduce the possible purchase price. Opinion seems to indicate a range of between 15% and 40% for the discount to adjusted finish value. While everything is negotiable, there are several issues in theory against the seller.

How to sell an unfinished house

How to Sell an Unfinished House

If you have been forced to finish your project early and are looking to sell an unfinished house, you may be relatively downbeat about the situation. Some of those undertaking such projects are just “happy to see the back of them”, but there is hope. Switch your position to the potential buyer; try to see your vision for the house when you started the project. That is what pushed you to take the chance and invest time and money even if, unfortunately, it was not ultimately successful. So what can you do?

Curb appeal

While curb appeal may be the last thing on your mind when selling an unfinished house, it is essential. Even though there may be limited improvements you can make to the house, can you improve the garden? Can you make any improvements to the outside of the house?

The key is to ensure that the project does not look like a building site, even though that is precisely what it is!

Virtual tour

We live in an era when the Internet is a part of everyday life, video technology has improved dramatically, and costs are being pushed lower due to competition. This has led many people to create a virtual tour of how they believe their unfinished home would look completed. Don’t automatically assume this is expensive because, in relative terms, it could add a significant amount to the sale price.

In effect, you are selling the dream, giving people a visual of how you see the property and the potential. While buyers will negotiate the best price possible, they may be a little more generous and determined to buy the property if they can see the potential. After all, you bought into the dream and took a chance, so why wouldn’t somebody else?


It may be difficult to contemplate achieving a reasonable price when looking to sell an unfinished house. If forced to sell due to financial problems, or personal issues, you will likely be downhearted. Many will quite literally sell for any price to “get rid” of the project, that financial millstone around their neck. However, there is hope, and there are ways to extract the best price possible.

If you find yourself in this situation, take a deep breath, relax, and look at the project as a buyer. Highlight the positives and potential for the property and try to sell the dream.

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