Completion of vacant possession BEFORE tenants leave?

DVardysShadow

Ulfar wrote: »

The landlord needs to give notice and get the tenants out before you exchange contracts.

I really don't see this. All that is required is a conditional exchange, subject to Vacant Possession within a specified period plus a mortgage offer valid to the end of the period. Additionally, tenants could be asked to sign contract.

silvercar

DVardysShadow wrote: »

I really don't see this. All that is required is a conditional exchange, subject to Vacant Possession within a specified period plus a mortgage offer valid to the end of the period. Additionally, tenants could be asked to sign contract.

Only if the buyer is prepared to be flexible on completion date, even then most solicitors would advise the seller to wait for vacant possession before exchange. Reduces the risk of tenants holding seller to ransom.

DVardysShadow

silvercar wrote: »

Only if the buyer is prepared to be flexible on completion date, even then most solicitors would advise the seller to wait for vacant possession before exchange. Reduces the risk of tenants holding seller to ransom.

With a conditional exchange on this all the problems are on the seller's side.

franklee

maa299 wrote: »

The tenants are aware of what's going on, and they've been there for 7 months (break clause may be invoked). It's not an AST, by the way.

Perhaps you'd better tell us what it is then, as most comments here will have been referring to an AST.

maa299

franklee wrote: »

Perhaps you'd better tell us what it is then, as most comments here will have been referring to an AST.

Common Law tenancy applies, as gross annual rental is over £25k.

maa299

The tenants are being cooperative and already are actively looking elsewhere.

I'm flexible on the completion date.

Is the vendor taking a risk by accepting an exchange subject to vacant possession? Should we exchange and complete on the same day? Again, I have no mortgage and the vendor has no mortgage to redeem...no lenders are involved.

franklee

maa299 wrote: »

Common Law tenancy applies, as gross annual rental is over £25k.

These may be of use so give an idea what's involved in giving notice etc:

http://www.landlordzone.co.uk/forums/showthread.php?t=21122&highlight=common

http://www.landlordzone.co.uk/forums/showpost.php?p=157548&postcount=6

What does your solicitor advise?

zzzLazyDaisy

Presumably you have instructed a solicitor, so use him to do the job you are paying him to do. S/he should be advising you on this.

You are buying a property with vacant possession. It is therefore a condition of the contract that the property is vacant on the day of completion. However, as others have said, simply serving notice on the tenants does not ensure they will leave on expiry of the notice.

Personally I would not exchange until the seller is in a position to give vacant possession. the solicitors can have all the documents signed and all the paperwork in place, and then once the tenants have left and the seller is in a position to give vacant possession you can go ahead and exchange and complete on the same day, if you wish.

maa299

My solicitor is just starting work on this, but she's experienced in both residential conveyancing and residential landlord & tenant law. I'm inspecting a copy of the lease now.

I think the vendor understands that my solicitor might act defensively and advise exchange & completion on same day once the tenants leave, so he asked for a non-refundable holding deposit from me to safeguard his own position.

In other words, if I withdraw, he'll have lost his tenants. I think I see his point.

DVardysShadow

maa299 wrote: »

... I think the vendor understands that my solicitor might act defensively and advise exchange & completion on same day once the tenants leave, so he asked for a non-refundable holding deposit from me to safeguard his own position.

In other words, if I withdraw, he'll have lost his tenants. I think I see his point.

I see his point too. But with a non refundable deposit, you are at risk to the extent of the deposit - effectively you need to be in the position where you would exchange but for vacant possession prior to handing over the non-refundable deposit. Subject to what you know about your own position, my preference in your shoes would be to make a conditional exchange with a drop dead date rather than handover a non refundable deposit

zzzLazyDaisy wrote: »

... You are buying a property with vacant possession. It is therefore a condition of the contract that the property is vacant on the day of completion. However, as others have said, simply serving notice on the tenants does not ensure they will leave on expiry of the notice.

Agree thus far

Personally I would not exchange until the seller is in a position to give vacant possession. the solicitors can have all the documents signed and all the paperwork in place, and then once the tenants have left and the seller is in a position to give vacant possession you can go ahead and exchange and complete on the same day, if you wish.

I agree about not exchanging unconditionally, but a conditional exchange can be given, giving vendor confidence to obtain vacant possession. This could lead to unconditional exchange and completion on the same day.