Reluctant LL's....

daleigha

We are coming to the end of our lease, and have seen a lovely property to rent. It was originally up for sale, and is now to rent as the owner couldnt find a buyer and had already bought another house.

Im sure the rental market is flooded with LL's like this, and i am just wondering how long you want / expect to rent your property out before trying to sell it again?

we are keen to stay in this property for about four years, until we have hopefully saved up a deposit for a house, and i would really be disappointed if we had to start looking yet again next year - i am totally fed up of moving, and really want to settle somewhere. so are you planning on renting until the market improves, and then sell, regardless of whether or not you have good tenants, or if you had good tenants would you consider continuing to rent until they decided to leave, and then try to sell up?

i know that anything could happen when renting, and the rug could be pulled from under our feet, but i just fell at the minute, although there are plenty of rentals about, and rent is negotiable, when a lot of rentals belong to people trying to sell, i just dont know what sort of security we would have.

TIA!!

x

daleigha

Bump!! Anyone want to share their opinions?!?!

p00hsticks

Personally I'm not in this position but I guess it would depend on whether the rent being charged is sufficient to meet the outstanding mortgage payments - if it was, then they may jump at the chance of getting someone in to cover the mortgage for a long period during a slump ...

Gorgeous_George

I fear that there nmay be trouble ahead. Covering the mortgage interest is only one of the costs involved with letting.

A poor quality house or poor quality tenants can add a significant sum to the overall running costs. Voids, marketing costs, LA fees, tax, insurance and repairs are just some of the aditional costs taht many reliuctant LLs will have failed to budget for. Most don't even have an exit plan. What if the lender makes a margin call (however unlikely)?

In the beginning it looks like a good idea. I'll rent it out until the market recovers. Who believes that the market will recover? Not me.

If the house is what you want, rent it by all means but, make sure you have a plan just in case the LL goes bankrupt. Try to confirm that the LL has permission to let. Try to nrgotiate a low deposit.

GG

melski09

Im a landlord and also worked in a lettings office for many years. Even if you rent in a "normal" economic climate, a landlords personal circumstances change, and you may be evicted for any reason anyway, but u r right, theres so many owners in the position whereby they are renting as they cant sell, hence reduction in current rents. best bet is to haggle with him/her for a min 2 year agreement with the rental amount stated in the agreement, maybe with a small increase in year 2, and NO break clause, then you can stay for 2 years, just be aware that if for any reason your circumstances change, you are stuck to the agreement unless you find someone else to renew the agreement, works both ways. On your side, though, is the fact that not a lot is selling, so your owner may be up for a longer agreement so they know the
mortgage will be covered which is so important at the moment, though its scary being a landlord, hoping your tenants wont call you to say theyve been made redundant and cant pay the rent and the council will only pay part of it..Im hoping my tenants wont leave, if they do i will search for more tenants as I know the house wont sell at the moment and it may not for a few years to come.

silvercar

I'm sure the rental market is flooded with LL's like this, and i am just wondering how long you want / expect to rent your property out before trying to sell it again?

If you have a happy tenant paying your mortgage, I doubt you would risk having an empty property for months while you hope to sell.

Certainly while the housing market is so bad it would be madness to turf out a decent tenant to try and sell.

daleigha

thanks for the comments guys!!

i do agree that im concerned that the LL will default on the mortage - i asked the EA how long the LL had lived in the property for.... of course they didnt know :rolleyes: i thought it would have given me some kind of rough idea of his mortgage costs - if he had lived there for 30 years then it would be a safer bet that living there for one year!!

im also worried about the LL managing the property - on one hand, its in his interest to keep it well maintainted as he is presumably hoping to sell it at some stage, and as its his only property (i assume) then he may be good. but, he also may be totally clueless!!

melski09 - i totally know what you are saying about a longer lease - that would probably be preferable for me as im happy with the area and the house and would just live to live somewhere longer than a year!

we are good tenants, pay on time, dont make noise and take care of the house, so hopefully if he is happy with us he will let us stay for a bit longer!!