No idea if this will work..will it??

notlongnow_2

Hi, Ill try to keep this short..lol.

I live with my OH in his house...there is no mortgage on this property but there is a secured loan with 17months left to run.

I am half owner in the house where my ex lives. He has realised that this house is far too big for him and is in the process of finding somewhere else to live. I have paid towards this house since I left with the children.

Myself my OH and the children are going to move into my house.

We dont really know what to do with OH's house..do we sell or rent?? I know the housing market is pants at the mo and wonder if it has a chance of selling.It is a 3 bed mid terrace, ideal for family or first time buyer due to it only being worth approx £90k. It does need some work doing to it, mainly cosmetic.

We have been approached by a couple we know who want to rent OH's house as they have had their rent increased by a silly amount and dont want to pay it. Our dilema is that we have no idea how to go about renting this house. We dont want the rental charge it would be worth, as it would be just left standing and as long as it pays the secured loan on it then we are happy with that.

What do we need to do re: private renting?? will we need to finish the work that needs to be done on the house or is it 'rented as seen'?? Do we need to safety check everything ourselves or is that up to the tennants?

The rent will be declared and everything will be above board but we are wondering if it is possible to just rent it to this couple as it stands or will it be too much hassle and shall we just put it up for sale, even though no one knows how long it will take to sell?

This is complicated..lol

Any help will be gratefully received.

Premier_2

You may need to get permission from the lender before you can let the property.

You can attempt to let the property in any condition you want ... as long as it meets the requirements that tenants can legally expect. e.g. if 'cosmetic' means it need repainting that's fine. If 'cosmetic' means it has a broken electrical switch that is postentially dangerous, that is not ok.

Remember, there's a lot more to letting a property than just covering the loan secured on it. What happens if the boiler blows up the day the tenants move in? Can you afford to replace it if necessary?

I suggest if you don't know how to go about letting the property or what your responsibilities are, you should use a reputable letting agent ... who of course will want paying for their expertise & services they supply.

notlongnow_2

Premier wrote: »

You may need to get permission from the lender before you can let the property.

You can attempt to let the property in any condition you want ... as long as it meets the requirements that tenants can legally expect. e.g. if 'cosmetic' means it need repainting that's fine. If 'cosmetic' means it has a broken electrical switch that is postentially dangerous, that is not ok.

Remember, there's a lot more to letting a property than just covering the loan secured on it. What happens if the boiler blows up the day the tenants move in? Can you afford to replace it if necessary?

I suggest if you don't know how to go about letting the property or what your responsibilities are, you should use a reputable letting agent ... who of course will want paying for their expertise & services they supply.

Thanks for that. Re: the boiler, I was thinking similar today about if something went wrong and would be a lot to repair is it up to my OH to get it done. (the boiler and heating are only 18months old..serviced recently)

Ive been reading about letting and to be honest, it does seem a lot of hassle for not a lot of money a month. Is there a way to let it out on the understanding that *if* anything goes wrong then its the tennants who pay??

In an ideal world id like the potential tennants to come look around the house, me point out everything that needs doing(and it is minor things...painting some rooms, no tiles on the bathroom floor, just boards-same in utility.) id like them to say, 'yes we will take it for 6 months, heres £XXX amount' then for me to contact tax people or whoever it is, and find out how to declare it.
Thats not going to happen is it..lol.

Maybe sale is better.

socrates

notlongnow wrote: »

In an ideal world id like the potential tennants to come look around the house, me point out everything that needs doing(and it is minor things...painting some rooms, no tiles on the bathroom floor, just boards-same in utility.) id like them to say, 'yes we will take it for 6 months, heres £XXX amount' then for me to contact tax people or whoever it is, and find out how to declare it.
Thats not going to happen is it..lol.

errrm let me think ...... NO!

moongarden

notlongnow wrote: »

Ive been reading about letting and to be honest, it does seem a lot of hassle for not a lot of money a month. Is there a way to let it out on the understanding that *if* anything goes wrong then its the tennants who pay??

I'm sorry but I think you are right, its not going to happen. Have you looked online for rental properties in the same area at the same size to get an idea of the rental value and the same for properties for sale to give you an idea of the sale value?

What would you do with the money if you sold it?

zaksmum

my neighbour rents out houses, he buys them at auction, does a few cosmetic jobs on them, decorating etc., gets a gas safety check then advertises in the local paper for tenants. For the poor quality properties he says he'll accept DSS and gets killed in the rush.

He selects the best of the bunch, requires a deposit of a month's rent upfront as security deposit, takes out landlord's property insurance and checks references and then lets the tenant move in for an initial period of 6 months. The tenancy agreement can be purchased for about £5 from a legal stationers.

One drawback now though is that rent paid by DSS used to go direct to the landlord's bank account - now it has to go to the tenant, who then - in theory - pays the landlord...!!!

Might be worth checking out.

notlongnow_2

moongarden wrote: »

I'm sorry but I think you are right, its not going to happen. Have you looked online for rental properties in the same area at the same size to get an idea of the rental value and the same for properties for sale to give you an idea of the sale value?

What would you do with the money if you sold it?

Hi, the rental value is £450 and we would be happy with £300 from this couple. and the sale value of the house is around £90k.

We are quite reluctant to go through an agency as we would prefer to rent out to someone we know but keep it legal, we have no intentions of defrauding with tax etc.

If we sold the house then the money would go towards lessening the mortgage on my house when the tie-in period is up, in which we would then take off my ex's name and add my OH's name.(Ex is happy with this), in approx 2 and a half years. So we wouldnt be desperate to sell it until that time but we both have some debt so a small part could pay off now.

notlongnow_2

zaksmum wrote: »

my neighbour rents out houses, he buys them at auction, does a few cosmetic jobs on them, decorating etc., gets a gas safety check then advertises in the local paper for tenants. For the poor quality properties he says he'll accept DSS and gets killed in the rush.

He selects the best of the bunch, requires a deposit of a month's rent upfront as security deposit, takes out landlord's property insurance and checks references and then lets the tenant move in for an initial period of 6 months. The tenancy agreement can be purchased for about £5 from a legal stationers.

One drawback now though is that rent paid by DSS used to go direct to the landlord's bank account - now it has to go to the tenant, who then - in theory - pays the landlord...!!!

Might be worth checking out.

Now thats more like what I was thinking. The couple(middle aged) who want OH's house are both working and have lived in their current house for 8yrs (not DSS)so I know they arent complete muppets. Im sure references wont be a problem. We toyed with the idea of an initial 6month lease and if it wasnt working then they leave and we sell.

The gas system was serviced less than a year ago and is less than 2 years old. It has smoke alarms, carbon monoxide alarms but there is no door on the attic staircase leading to the attic room so I suppose its classed as 2 bed not three??

Thanks, you have been very helpful.

barnaby-bear

notlongnow wrote: »

Thanks for that. Re: the boiler, I was thinking similar today about if something went wrong and would be a lot to repair is it up to my OH to get it done. (the boiler and heating are only 18months old..serviced recently)

Ive been reading about letting and to be honest, it does seem a lot of hassle for not a lot of money a month. Is there a way to let it out on the understanding that *if* anything goes wrong then its the tennants who pay??:eek::eek::eek:

In an ideal world id like the potential tennants to come look around the house, me point out everything that needs doing(and it is minor things...painting some rooms, no tiles on the bathroom floor, just boards-same in utility.) id like them to say, 'yes we will take it for 6 months, heres £XXX amount' then for me to contact tax people or whoever it is, and find out how to declare it.
Thats not going to happen is it..lol.

Maybe sale is better.

Being a LL is running a business. Do you want to run a property management business, do you have the skills/resources?

National Landlord Association has lots of sample contracts and advice forums - if you want to try at least join them and learn quickly...

Entertainer

As it sounds like it is in a perfectly lettable condition then it seems a complete waste to have it left idle when it could be earning you a much needed income.

Don't worry too much about potential expenses, think of it this way- you will have £2400 of rent you wouldn't otherwise have (at £400 a month) to pay for anything. You could always have some work done while they are in there.

£300 seems too low, that's a yield of 4% on 90k!! Look for 350/375 at least.

franklee

Why not do the cosmetic work, say if you did the floor tiling and asked the tenants if they wish to paint. If not why not paint too perhaps when it's empty after you've moved out? Seems odd to lose value on the rent due to the lack of a little work.