Buying the property you rent as a tenant

lizards

Obviously it very much depends on individual circumstances and so on, but -

Is it a fairly acceptable thing for tenants to buy the property they're renting? I'm assuming, of course, that they want to and are in a position to do so and the landlord is happy to sell!

I'm thinking of both scenarios of putting in an offer even though it's not for sale, or offering to purchase if it is put on the market for whatever reason.

Do landlords in general try to avoid selling to their tenants? They'll already presumably have to pay a fee to the letting agent if they do, so no financial advantages of bypassing an estate agent. I'm aware of the other obvious downsides for the landlord e.g. house not on the open market for starters or tenants theoretically discouraging other viewers. However do many landlords overlook those issues for the sake of convenience, or maybe even the human aspect because on a personal level they'd rather see their property go to the people who have made it their home? Does that even happen??

It's all theoretical for us right now, but in an ideal world we'd love to buy the house we're in one day, and there is a chance it may eventually come up for sale anyway (rent paying care home fees situation) I'm just wondering if offering to buy the place ourselves is something we could possibly have a chance of succeeding with or if it's likely we'd be flat out refused. Not that I'd pin all our hopes on it if it was a reasonable possibility, but I'd like to know if I'm wasting my time even thinking about it!

anselld

It happens.

For the LL it avoids the issue of trying to sell with vacant posession but not wanting to leave a long void period.

For the T it avoids the timing issues of giving notice and not wanting an overlap between renting and owner-occupying.

The main difficulty is establishing the market value, depending on how many similar properties have sold in the local area.

lizards

Thanks! That's true, I hadn't thought of the void period. That would probably offset a small (or even large) part of the letting agent fees so there is some financial advantage at least.

Obviously the advantages to us would be immense for so many reasons, and we have been really good tenants over the last two years since we moved here, but I know business is business and we'd never take it personally.

It's not a particularly unique house in the local area by any means, so hopefully there would not be too many issues working out a fair price if they were open to it.

stator

It does happen fairly often, no harm in asking.

If there is a letting agent involved don't ask them. They will have a motive for stopping the sale and they also may demand fees from the sale (Although they shouldn't) Go direct to the landlord.

lizards

Thanks! That's interesting - I kind of assumed the LA would take a fee (or be able to sue for one) Fairly sure from what I remember it's in our contract (I should dig it out and have a look) but I realise in some cases some clauses are worthless.

Fees or not, that's an excellent point about it not being in their interests to let the sale go through. I imagine they enjoy a nice little easy earner from our rent every month for very little work as we have hardly contacted them for anything over the last few years since we moved in, and the inspections have been annual at best!

[Deleted User]

As you have said, a lot depends on the personal circumstances of the LL. Right now, they probably won't want to sell as they still have the value of the house, and can pay nursing home fees out of the rent (assuming the house is mortgage fee). Once sold, the fees will come out of the capital which will eventually be gone.

If they did agree to sell at some point, u avoid a lot of the difficulties being in a chain would cause, and may be able to negotiate and get a small deduction in price (but no guarantee of this). I know with the property I am living in, that the LL wants to sell, he wants about £10k too much.

But you can only ask when you think its a good time. They can only say no at worse. You know the property, and will have a better idea than most buyers what needs to be done to the property (which will affect what you are prepared to pay). But don't be surprised if you LL is completely illogical. Don't expect anything lol.

buttonmoon

I've just bought the house I was renting. I was saving up for a deposit and planning to buy next year, but then got a phone call from my letting agent telling me that my LL wanted to sell. He was happy to sell to us as presumably it avoided and chain and a void period. We were happy to buy for the right price and avoid the hassle of moving!

Better_Days

The first house we bought we had previously rented.

The timing was right in that the LL wanted to sell and we were looking to buy. Worked well for both sides. LL didn't have to bother marketing and we were in a 'try before you buy' situation.

Never regretted it and all went smoothly for us.

AnnaLMLH

id sell the house we rent out to my tenants if they paid the right price no problem, may be worth approaching them

agrinnall

I would certainly approach the LL if I was renting, liked the property, and wanted to buy somewhere. If the LL says no then you can look elsewhere, if they'll consider it then you have a chance to make life a little easier for yourself.

malcolmffc

If I was a tenant buying then I would insist on the following:

- Rent is only payable up until the day of completion of the sale
- If exchange is delayed through action (or inaction) of the landlord such that the lease will expire before completion, then the lease to be automatically extended with no change in rent
- The deposit to be returned in full regardless of the condition of the property
- All agency fees to be covered by the landlord
- Landlord maintains building insurance up until exchange