Are "We Buy Any House" Companies a Scam?

If you need to sell your house quickly, you might have come across the "we buy any house" companies and wondered whether they're genuine or a scam. It's a fair question, because these companies have one of the worst reputations in the whole property industry.

I've worked in and around this part of the industry for nearly 15 years though, I ran my own house-buying company and competed against nearly all the major players, so I've seen exactly how they operate from the inside. Here's the honest answer.

Genuine "we buy any house" companies are not a scam, but they are one of the most expensive ways to sell, paying around 80% of your home's value. The bigger danger is that genuine companies are rare. The industry has no real regulation, and some use tactics like last-minute price drops that leave sellers out of pocket.

But there's more to it than that, and the detail is what keeps you safe...

If you want to cut right to the chase and see whether a "we buy any house" company is right for you, I've designed a short quiz to help with exactly that. It takes about 60 seconds and you get your results straight away.

If a house-buying company is the right fit, I'll introduce you to the one company I know and trust on your results page. And if it isn't, I'll point you towards the route that fits you better. Hit the button below to get started:

Why "we buy any house" companies exist in the first place

Before we get into the scams, it helps to understand why these companies exist at all. The demand for them is real, and it comes from a real problem.

"We buy any house" companies exist because selling a house the normal way is slow, stressful and uncertain. Whenever a market has serious problems like that, people look for an alternative, and a company promising to buy your house for cash today has obvious appeal.

Selling through an estate agent can be a real slog. Three things in particular push people towards these companies:

1. It's slow.
   According to Rightmove, the average house sale currently takes about 7 months from start to finish. And that's the average, so half of all sales take even longer than that.
2. Sales fall through.
   A sale can collapse at any point right up to exchange. Nationally, around 1 in 3 house sales fall through, which means a lot of wasted months for a lot of sellers.
3. People are unhappy with their estate agents.
   You pay a fee for a service, and a lot of the time it doesn't feel like you're getting one. It's one of the reasons estate agents are consistently ranked among the least trusted professions in the UK. I've written about why people dislike estate agents separately, and the list is long.

Put all that together and it's a whole mess. So you can see the appeal of a company that says something like: "We'll buy your house for cash today." The demand is there. That's why they exist.

But do they actually deliver? Well, here's the first problem...

The bad: even genuine "we buy any house" companies cost you around 20%

Even an honest "we buy any house" company only pays around 80% of a property's value. Buying houses is expensive and risky, so a genuine company needs that 20% to cover its costs and make a profit. For most sellers, giving up a fifth of their home's value is a massive hit to take.

So if someone's home is worth £250,000, a genuine company will typically offer them around £200,000 for it. That's £50,000 gone. And it's why even the honest, genuine companies can feel like a scam. You lose so much.

I know those amounts look crazy. But that 20% disappears really fast...

You can look up the accounts of some of the biggest genuine house-buying companies in the country on Companies House, and their profit margins are razor-thin. All that's left from their 20% chunk is just 1-2% profit.

The rest goes on the cost of buying the house, holding it, selling it again, covering salaries for the teams that value the properties and manages their sales, covering the purchases that go wrong, cover their advertising costs, and so on.

Now, you shouldn't feel sorry for them for that! But it does explain why no genuine company ever comes along offering 85% or 90% of market value. They simply can't, because they'd be making a loss.

So the verdict on the genuine companies is simple: they're not a scam, they're just horrendously expensive. If you want the full breakdown of the numbers, I've covered how much house-buying companies really pay in a separate guide.

Fair warning: If a company offers you 90% or 95% of your home's value, treat it as a red flag rather than good news. A genuine company can't afford to pay that. So either the offer is going to drop later, or the company isn't actually planning to buy your house at all.

And that begs the obvious question: are all these companies genuine? Well, this is where the real problem starts...

The ugly: why the "we buy any house" industry attracts scammers

The "we buy any house" industry attracts scammers because its customers are often under pressure and there is a lot of money at stake. A company's profit comes directly from how little it pays for your home, so its incentive runs against yours from the very first conversation.

Most people don't want to lose 20% of their home's value. So when a home seller does entertain it, it's usually because something is pushing them. I see it all the time, and it's often things like:

• Financial difficulty.
  Money worries where the sale has to happen before a real deadline, not just "some time next year".
• Health problems.
  An illness, or a move into care, that means the house simply has to go.
• Some other pressure.
  A separation, a job move, a chain that's collapsed. Anything that puts a clock on the sale.

And sadly, whenever you have that sort of vulnerability alongside this much money, you will get predators.

Here's the thing that's genuinely uncomfortable about this industry. These companies are not like estate agents, and the difference matters:

With an estate agent you're paying for a service. They only get paid when your sale gets done, so you're mostly aligned. With a house-buying company though, it's the opposite. They make their money by taking it from you. Literally, the less they pay for your home, the more they make.

That creates a horrible incentive to exploit exactly the situations I listed above. And that, again, is why this industry feels so scammy. (And in a lot of cases, why it is.)

So what do the scams actually look like in practice? There are a few, but two come up far more than any other...

The 2 most common "we buy any house" scam tactics

Having competed against these companies for years, and speaking with sellers every week who are dealing with them, these are the two tactics I see most often:

1. The high offer that gets cut later.
   A company makes a strong initial offer that they already intend to reduce further down the line. You take your house off the market, you start packing, and then the price drops right before completion. And there is nothing to stop them doing it.
2. The "quick sale" that isn't a sale at all.
   A company acts like it will buy your property quickly. But instead of buying it, it locks you into a long contract and then goes looking for a buyer, exactly like an estate agent would. They'll often dress it up as an exclusive sale to a private list of hungry investors...
   
   But in reality, every company I've seen pitch this just puts the property on Rightmove. Meanwhile, you've signed away months of your time for a service that was completely missold.

So why would anyone ever sign up to a service like that? The obvious answer is you wouldn't. So how do they get customers? 

Simply get, they get people to sign by over-promising and misrepresenting what they actually do, and how they work.

There is absolutely a ton of awful behaviour among a lot of these companies. And I know a lot of people hear that and think: "It can't be that bad. Maybe there are some dodgy backstreet outfits, but the big companies, the ones at the top of Google with all the good reviews... they must be legit."

Not quite the case though. Which brings us to the third and final problem with this industry...

Why the biggest "we buy any house" companies aren't automatically the safest

The "we buy any house" industry is not regulated, so the biggest companies are not necessarily the most trustworthy. In a normal industry the best companies rise to the top. In this one the most aggressive and least trustworthy companies rise to the top, because there are no real consequences for bad behaviour.

In a normal industry you'd be right to trust the big names. Size usually means reputation. But this industry isn't normal, because nobody regulates it. So the opposite happens. It's upside down.

Now, to be clear, these companies will all point to the badges on their website, showing how highly regulated and well-behaved they are...

But here's what those badges actually mean:

• The Property Ombudsman.
  Many companies are members. But in the Ombudsman's own words, it is not a regulator. It "does not have the authority to take regulatory or legal action against a company, to impose fines, or to dictate the way companies conduct their business." - source.
• The National Association of Property Buyers (NAPB).
  Many are members of this too. Let's quietly ignore the fact that the industry set this organisation up itself, and wrote its own rulebook... But even in its own words, the NAPB is "not in itself a redress scheme or regulator, it can provide information to anybody who feels that they have been unfairly treated." - source.

That's it. Information. After you may already have been scammed. That is what I mean when I say this industry isn't regulated, and that is the full extent of the protection you have.

The Ombudsman and the NAPB give the illusion of safety without actually doing anything to keep the industry clean or properly protect sellers.

And don't let a wall of five-star reviews settle it for you either. Reviews in this industry need a careful eye of their own.

Fair warning: Unfortunately, you can't trust online reviews for house-buying companies either. Many companies post fake reviews, campaign to get bad reviews removed, and saturate their page with reviews from clients who made an enquiry and had a pleasant initial interaction... but never actually used the service. Some even pay customers to take bad reviews down.

I explain how to spot it in my guide Can You Trust House Buying Company Reviews? [How To Avoid The Scams].

Let me show you a story from a while ago that illustrates all of this...

A real example: the seller from Leeds

A while ago I spoke with a lady from Leeds. She was in a pretty tough situation financially and she needed to sell fast, so she'd gone down the "we buy any house" route.

Here's what happened to her:

1. The first company cut its offer from £200,000 to £170,000.
   She'd been going through the process with them for a few weeks when the price suddenly dropped by £30,000.
2. So she went to a second company.
   She still really needed to sell. This time she got all the way to moving day, and then they dropped their offer from £202,000 to £160,000. That's when she contacted me.
3. Both companies were members of The Property Ombudsman and the NAPB.
   One of them was even a founding member of the NAPB...

And yet that seller had no protection, and no compensation. She just had to pick up the pieces and figure things out from there.

If you're weighing up an offer right now, please don't sign anything until you know whether this route even makes sense for you. You can book a free call with me here to see if a house-buying company is really the right fit for you. If it is, I'll point you to the one company I actually trust... if it's not, I'll help you put together a plan to sell for more.

So, are "we buy any house" companies all scams? Let's pull it all together...

So are "we buy any house" companies a scam? The good, the bad and the ugly

Here's the real summary, having worked in and around this industry for nearly 15 years:

• The good.
  A genuine company can buy your home way faster than you'd sell with an estate agent. Done properly, it's easy and stress-free, and you know the sale is actually going to happen.
• The bad.
  Even with a genuine company, it's going to cost you around 20% of your home's value. That's the price of the speed, and no genuine company can get round it.
• The ugly.
  There are very few genuine companies. It's a shark-filled industry with no real regulation, no oversight, and no consequences for the companies that behave badly.

So the genuine companies aren't a scam. But finding one, and knowing whether it's even the right route for you, is where most sellers go wrong...

Should you use a "we buy any house" company at all?

A "we buy any house" company only makes sense if speed, certainty and convenience matter far more to you than the price you get. That is a much smaller group of sellers than the adverts suggest. For most people, there are ways to sell quickly that keep far more money in their pocket.

Just so you know, I spend most of my time talking people out of using house-buying companies. When someone books a call with me looking at this route, I end up suggesting a different one around 97% of the time. One where they still sell in the timeframes they need, but get way more money doing so.

Those alternatives usually look like one of these:

• A well-run estate agent sale.
  Priced right and marketed properly, a normal sale can be much faster than average.
• Auction.
  Still a fast, certain sale, and for the right property it beats a house-buying company's offer by a long way. I cover whether selling your house by auction is worth it in a separate guide.
• A genuine house-buying company.
  If speed and certainty genuinely are everything to you, I can connect you with a genuine company. I've been working with them for over 10 years now.

If you want to compare every fast-sale route side by side first, my guide to how to sell your house quickly does exactly that.

Related: House Buying Companies: The Ultimate Guide [My Honest Advice & Tips]

So if you want a quick, easy sale but you're nervous about dealing with these companies,  I've built a quiz you can take. In 60 seconds you answer a few questions, and it tells you whether this route makes sense for you.

If it does, you can connect directly with the only company I personally recommend. If it doesn't, I'll show you the best alternatives and help you with a free tailored plan. Thanks for reading, be careful out there, and hit the button below to get started:

Common questions about "we buy any house" scams

1

Are "we buy any house" companies a scam?

Genuine "we buy any house" companies are not a scam, but they pay around 80% of your home's value, which makes them one of the most expensive ways to sell. The real risk is that genuine companies are rare, the industry is unregulated, and some companies drop their offer at the last minute or lock sellers into long contracts.

2

How much do "we buy any house" companies pay?

Genuine, well-funded "we buy any house" companies pay around 80% of market value. Buying houses is expensive and risky, and the accounts filed at Companies House show many of the biggest companies make only 1 to 2% profit. That is why no genuine company can offer 85% or 90% of your home's value without making a loss.

3

Are "we buy any house" companies regulated?

The "we buy any house" industry has no regulator in the UK. The Property Ombudsman says in its own words that it is not a regulator and cannot fine companies or dictate how they operate. The National Association of Property Buyers was set up by the industry itself and describes itself as neither a redress scheme nor a regulator.

4

Can a "we buy any house" company reduce its offer at the last minute?

A "we buy any house" company can reduce its offer at any point before exchange, and some do it deliberately right before moving day. Nothing in law stops them. Your protection is to deal only with a genuine company, insist on a guarantee-backed offer, and have the survey done at the start of the process rather than the end.

5

Does Property Ombudsman or NAPB membership make a "we buy any house" company safe?

Membership of The Property Ombudsman or the NAPB does not make a "we buy any house" company safe. Neither body can fine a company, stop it trading, or force it to compensate you. Both of the companies that cut their offers on the Leeds seller in this guide were members of both schemes, and she had no protection at all.

6

Who should sell to a "we buy any house" company?

A "we buy any house" company suits sellers who value speed, certainty and convenience far more than getting the best price. That is a small group. For most sellers, a well-run estate agent sale or going to auction still meets a tight timeframe while keeping far more money in your pocket.