Understanding Immediate Real Estate Purchases: Avoiding Common Pitfalls

Many of you who are considering selling your real estate may have conflicting requests: "as high as possible" and "as fast as possible. In a normal real estate sale, while it is possible to sell at market price, it generally takes an average of 3 to 6 months to complete the sale. However, by utilizing the immediate purchase option , it is possible to complete the sale in as little as seven days to one month.

This article will provide detailed information on how immediate purchase of real estate works, its advantages and disadvantages, and even how to choose a specialized purchase company to achieve an early sale of real estate. We hope you will find this information useful for those who are in a hurry to make funds and those who wish to avoid complicated sales procedures.

What is immediate purchase of real estate? Understanding the difference from agency

Basic concept of immediate purchase of real estate

Real estate immediate purchase is a method in which a real estate company directly purchases a property, unlike the usual method of sale through a real estate brokerage. In a general agency sale, the real estate company acts as an intermediary between the seller and the buyer, and plays the role of searching for a buyer. On the other hand, in immediate purchase, the real estate company itself becomes a buyer and purchases the housing directly.

The greatest feature of immediate purchase is, as the name suggests, quick completion of transactions. Since it is necessary to look for a buyer in agency, it takes time from putting on the market to the conclusion of a contract, but in immediate purchase, since it becomes a direct deal with a real estate company, it can proceed quickly from an appraisal to a sales contract.

Difference between immediate purchase and guaranteed purchase

Although "immediate purchase" and "guaranteed purchase" are often confused, there is a definite difference between them.

Immediate purchase is a method in which the purchase by the real estate company takes place immediately after the request is made. On the other hand, guaranteed purchase is a system in which normal agency sales activities are first conducted, and only if no buyer is found within a certain period of time, the property is purchased at a pre-determined price.

The main difference between agency and purchase

Understanding the difference between "agency" and "purchase", which are the main methods of real estate sales, is important in selecting the best sales method. The following table compares the main differences.

As described above, although purchase is inferior to agency in terms of price, the shortness of the sale period and thesimplicity of the procedure are great charms. When you want to sell off real estate early, or when you want to sell off surely without taking time and effort, it is a promising option.

Merits and demerits of immediate purchase

Merit: Early funding and simplified procedures

The greatest merit of selecting real estate purchase is, after all, the speed of sale. While a sale by intermediary takes 3-6 months or more, an immediate purchase can be cashed out in as little as 7 days to 1 month. This is a great advantage for those who have deadlines for mortgage repayment or inheritance tax payment.

Another major advantage is that no brokerage fee is required; since a brokerage fee of approximately 1 million yen is incurred for a 30 million yen property, this cost reduction is a major advantage.

In addition, immediate purchase greatly reduces the time and effort required for sales activities. This is a great advantage for busy people or those who live far away from the property, as it eliminates the need for complicated tasks such as handling previews and cleaning and tidying the property.

Disadvantage: Difference from market price

On the other hand, the biggest disadvantage is that the sale price will be lower than the market price. Generally, the immediate purchase will be priced at 70-80% of the market price. This difference takes into account the real estate company's risk hedging and renovation costs after the purchase, as well as the interest burden during the period until resale.

For example, for a property with a market price of 30 million yen, the purchase price will be about 21 million yen to 24 million yen, which may be about 6 million yen to 9 million yen lower. Therefore, it is not a suitable option for those who want to sell at the highest possible price.

People and situations for which immediate purchase is suited

Immediate purchase of real estate is particularly suitable for the following people and situations.

Those who need funds quickly

• Those who have difficulty repaying their mortgage.
• Those whose inheritance tax payment deadline is approaching (less than 4 months before the tax payment deadline)
• Those who have an urgent need for funds and need to cash out as soon as possible
• Those who want to expedite the division of property due to divorce

Those who want to avoid the hassle of selling

• Those who are too busy to take time to respond to viewings
• Those who live far away and have difficulty managing the property
• Those who are elderly and wish to avoid the burden of selling activities
• Those who value privacy and do not want their home to be seen by viewers.

When it is advantageous to purchase the property due to its characteristics

• Old or dilapidated properties
• Properties that cannot be rebuilt
• Properties with psychological defects such as accidents
• Property that needs to be demolished (land with an old house)
• Property with complicated rights

Check the table below to see if your situation is suitable for immediate purchase.

If there are many "yes" answers to the above items, immediate purchase is likely to be suitable.

How to Select a Specialized Buying Company

Selecting a buyer by property type

Real estate buyers specialize in different types of properties. To select the appropriate buyer, it is important to first choose a company that is strong in your property type.

Below are our recommendations for buyers by property type.

Companies Strong in Buying Single-Family Homes

1. Kachitas - Nationwide and specializes in the purchase of single-family homes

Companies strong in purchasing condominiums

1. Daikyo Anabuki Real Estate - Track record in large-scale condominium development
2. Intellex - Pioneer in used condominium revitalization and resale

Companies with a strong track record in land purchases

1. Tokyu Livable - Track record in land utilization and redevelopment
2. Mitsui Rehouse - Wide range of support through nationwide network

Key Points for Selecting a Buying Agent

When selecting a real estate buyer, you can receive higher purchase price and reliable service by paying attention to the following points.

1. Take assessments from multiple companies.
   Compare and consider assessments from at least three to five companies. Price differences can amount to millions of yen.

2. Choose a firm that is familiar with the area.
   A vendor who has extensive experience in the area and is familiar with the local market can expect to receive a high price.

3. Check the purchase record
   Check the number of purchases per year and purchase cases, and choose a vendor with a wealth of experience.

4. Compare service contents
   Ancillary services such as support for removal of leftover items and flexibility in delivery dates are also important.

5. Check reliability and screening
   Check the reliability of the builder by the builder's license number, year of establishment of the company, and word-of-mouth reputation.

Flow and Duration of Immediate Purchase of Real Estate

8 Steps of Immediate Purchase

This section describes the general flow of using immediate purchase of real estate and the points to note at each stage.

1. Market price survey (1 day to 1 week)
   Grasp the purchase market price in the area (approx. 70-80% of the agency market price).

2. Collection of necessary documents (1 day to 2 weeks)
   Prepare identification, personal seal and seal registration certificate, certificate of residence, certificate of title, etc.

3. Request for valuation (1 day to 1 week)
   I apply for a desk valuation → visiting valuation to several companies, and compare assessed values.

4. Selection of a vendor (1 day)
   I narrow it down to one company based on an assessed value, a purchase track record, and a word-of-mouth reputation.

5. Negotiation of conditions (1-3 days)
   Decide detailed conditions such as purchase price, delivery date, disposal of unwanted items, and payment date.

6. Conclusion of purchase agreement (1 day)
   Confirm all details of the contract and receive the deposit.

7. Settlement and delivery (1 to 2 weeks)
   Receive the sale price, hand over the keys and documents, and pay the judicial scrivener's fee.

8. Final tax return (February 16 to March 15 of the following year)
   Declaration and payment of transfer income tax.

The following table compares the difference in time periods between an agency sale and an immediate purchase.

Points to achieve a higher purchase price

Here are some points to make your real estate purchase more expensive.

1. Compare assessments from multiple companies.
   Competing with each other may increase the purchase price.

2. Choose a firm that is strong in the property type.
   If the property is in your specialty, you can expect a higher purchase price.

3. Determine the timing
   Aiming for a period when the real estate market is strong is also effective.

4. Communicate the good points of the property
   Show the appeal of the property, such as sunlight and good facilities.

5. Leave room for negotiation
   Tell the minimum asking price from the beginning and leave room for negotiation.

Conclusion

Immediate purchase of real estate is an effective option for many people as a speedy method of selling a property. Here is a summary of the main points of this article.

• Immediate purchase is a method of sale in which the real estate company becomes the buyer directly, enabling sale in as little as 7 days to 1 month
• The sale price is about 70-80% of the market price, but no brokerage fee is required and procedures are simplified
• Particularly suitable for those with urgent financial needs and those who want to avoid the hassle of selling
• It is important to choose a specialized purchase company that has strengths in each property type.
• By obtaining assessments from multiple companies and comparing them, the possibility of an expensive purchase is increased.

If you follow these points, you will be able to sell your real estate quickly and at a fair price. Selling real estate is a major life decision. We recommend that you choose the best sales method for your situation and make a transaction that you will not regret.

Frequently Asked Questions

Q1: Can an immediate purchase really be completed in as little as 7 days?

A1: Yes, it is possible to sell the property in as little as 7 days with a process such as immediate appraisal and next-day contract. However, if procedures such as ownership transfer registration are included, it usually takes two weeks to one month. If you are in a particularly urgent situation, you should inform the buyer of this.

Q2: How should I distinguish between a purchase and a guaranteed purchase?

A2: If you are in a hurry to get funds, we recommend immediate purchase. If you have time to spare and want to sell at the highest possible price, we recommend guaranteed purchase. With Guaranteed Purchase, the property will be marketed through an intermediary for a certain period of time (usually about 3 months), and only if no buyer is found will the property be purchased, leaving the possibility of selling at market price.

Q3: Can the purchase price be negotiated?

A3: Yes, negotiation is possible to some extent. In particular, it is effective to request assessments from multiple buyers and compare the assessments of each company as a bargaining chip. However, since it is difficult to purchase at the market price, it is best to consider 80% of the market price to be the realistic upper limit.

Q4: Can you purchase old properties or properties in poor condition?

A4: Many professional buyers actively purchase old properties, properties in poor condition, and even properties that cannot be rebuilt. Although these properties are easily avoided by ordinary buyers, they can be purchased under certain conditions, as buyers assume that they will be renovated or remodeled. In fact, it can be said that such properties are often suitable for purchase.

Q5: Can properties with accidents or psychological defects be purchased?

A5: Yes, many buyers will purchase properties that have been involved in accidents or have psychological defects. Even in cases where it is very difficult to find an ordinary buyer through an intermediary, a specialized buyer can be expected to purchase the property at a fair price. However, be sure to declare in advance that the property is an accidental property.

Reference information

For more detailed information on immediate purchase of real estate, please refer to the websites of the following public institutions and organizations.

• Ministry of Land, Infrastructure, Transport and Tourism, Real Estate Transaction Information Providing Website - Real Estate Transaction Price Information
• Organization for Promotion of Proper Real Estate Transactions - statistical data and notes
• Center for Real Estate Information and Promotion - Information on real estate sales

If you are considering an immediate purchase of real estate, we recommend that you first request a free appraisal from several specialized purchase companies to get a sense of the market value of your property. We hope this article will be of assistance to you in the sale of your real estate.