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Can I sell and let out my house at the same time?

Hi
I'm looking to sell up but feel it may take some time. I'll be moving out anyway but rather than pay mortgage payments for nothing I was considering letting my house out.

Does anyone know if it's possible to have the house up for sale at the same time as renting it out?

Also, when letting a property out, if I use an agent do they do absolutely everything for their fee? ie market the property, responsible for rent collection, all the legal stuff?

Anything to help?
Thanks in advance
«1

Comments

  • Doozergirl
    Doozergirl Posts: 33,982 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    In a word? No.

    Firstly, I doubt you will find a tenant that will happily live in a house that is up for sale, have viewers traipsing through etc.

    Secondly, your tenant is there for at least six months, so it makes it incredibly difficult to time a sale. The amount an agent takes makes it not such a great option to have tenants in for a period of only six months. They will take an amount that usually comes out at around an entire rents month, more if you ask them to manage, collect rent etc. And a bad tenant can quite easily cause more damage and cost you much more than your few months rent.

    You have no guarantee that the tenant will leave when you ask, so they have to be out before you can even exchange contracts. As a landlord the notice period you give works out to be between 2-3 months and if they refuse to leave, they can stay for often another few months before you can get a court order to remove them. Buyers will be put off if you can't be flexible with move in dates.

    If you sell a property already tenanted to another landlord, your market is suddenly reduced and the value of your property will be reflected by rental yield instead of the open sale market. A professional Landlord will pay you about 10x the yearly rent you receive, whereas a usual property in my area could be worth more than 20x the yearly rent.
    Everything that is supposed to be in heaven is already here on earth.
  • ruggedtoast
    ruggedtoast Posts: 9,819 Forumite
    doctor-dee wrote: »
    Hi
    I'm looking to sell up but feel it may take some time. I'll be moving out anyway but rather than pay mortgage payments for nothing I was considering letting my house out.

    Does anyone know if it's possible to have the house up for sale at the same time as renting it out?

    Also, when letting a property out, if I use an agent do they do absolutely everything for their fee? ie market the property, responsible for rent collection, all the legal stuff?

    Anything to help?
    Thanks in advance

    Somewhere out there, in this enormous and cold world, is a clue floating around with your name on it...
  • G_M
    G_M Posts: 51,977 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    doctor-dee wrote: »
    Hi
    Does anyone know if it's possible to have the house up for sale at the same time as renting it out?
    Possible. Very hard.
    Also, when letting a property out, if I use an agent do they do absolutely everything for their fee?Depends on the contract you agree with them ie market the property, responsible for rent collection, all the legal stuff?

    Anything to help?
    Thanks in advance

    Ultimately the landlord is responsible. If the agent fails to protect the deposit or renew the gas safety certificate, the LL ends up in court. YOU are the landlord. YOU are responsible.

    What will you do if those nice tenants you find turn round and refuse access when you want to show buyers round? Or shut the door in the face of the buyer's surveyor? It's their home, so they can you know.

    No buyer will make a serious offer until you've got the tenants out because the tenants might refuse to go and be there for another 6 months.......
  • franklee
    franklee Posts: 3,867 Forumite
    Part of the Furniture 1,000 Posts Photogenic
    edited 7 February 2011 at 11:01PM
    If you look at this from a tenant's point of view, would they wish to spend money (referencing fees which can be several hundred pounds, removal fees etc.) to move into your property for only a short time and pay rent whist having the inconvenience of viewers traipsing round (will they be present for viewings or let the agent loose unaccompanied, keep the place tidy etc.). Doesn't sound like a great deal does it unless you offer a well below market value rent.

    You could, like often seems to happen in threads here, "decide" to put the property on the market after tenants move in but then I wouldn't expect any co-operation from the tenants over viewings of their home.

    As mentioned above there is also the hassle of needing them to vacate before you exchange contracts on a sale.

    Frankly I don't think letting out and selling mix.
  • If your still paying a mortgage on the property why not still reside their ?

    Like the others have said putting the property on the market and letting out is a major headache to achieve !
  • tbs624
    tbs624 Posts: 10,816 Forumite
    If you have a standard resi mortgage on the property you would need your lender's consent to let. You'd need LL insurances, gas safety checks/certification, an EPC and you'd need to declare your rental income to HMRC. You'd have legal repairing obligations, and you'll be at the mercy of the Ts on viewings. Even if Ts do consent to viewings being conducted, they are under no obligation to keep the property in a state of cleanliness/tidiness conducive to attracting buyers.

    As the others have said, from your own POV the main issue is likely to be that fact that you'd have no certainty over vacant possession. Many potential buyers are aware of this and would be put off buying your property.

    Add to this that anyone can set up in business as an LA - they aren't subject to mandatory regulation despite handling thousand of ££s worth of other people's property and money. As has been pointed out, the LA acts on your behalf and the buck would stop with you so using an LA does not always mean that being a new LL will prove to be straightforward.

    Put it on the market at the right price and it will sell, with far less hassle.
  • danothy
    danothy Posts: 2,200 Forumite
    Part of the Furniture Combo Breaker
    Somewhere out there, in this enormous and cold world, is a clue floating around with your name on it...

    I'd say the OP has more of a clue than those that don't bother to seek advice before they do something like this ...
    If you think of it as 'us' verses 'them', then it's probably your side that are the villains.
  • Somewhere out there, in this enormous and cold world, is a clue floating around with your name on it...


    That actually made me laugh!

    Thanks for the helpful advice folks. I have the answer I am looking for!
  • Brb
    Brb Posts: 472 Forumite
    Up and down the country though there are plenty that are doing exactly this.

    To be quite frank I find it abhorrent. It is using tenants as a commodity, someone to merely pay your mortgage and when you've sold up it's a case of ... well off you pop tenant.

    I wouldn't have a problem if these LLs were upfront about their plans and accepted less than market rate for rent. All too often though LL/LA are not up front and promise long term rent and charge full market rate. Oh that S21 ? don't worry about that, it's just to protect the LL blah blah blah

    :(
    Inside this body lays one of a skinny woman
    but I can usually shut her up with chocolate!

    When I thank a post in a thread I've not posted in,
    it means that I agree with that post and have nothing further to add.
  • Yeah...I found our flat on a local EA's website after we'd moved in (the whole building is up - it's 3 flats with the LL living in the top maisonette). We even allowed a couple of viewings. The asking price was 1.25m, and unsuprisingly there weren't any takers and it got taken down in the summer.

    Landlady has been super nice to us since she hasn't been able to sell...funny that. I still think she was out of order to let us sign a contract when she knew she wanted to sell.
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