Advise Please: Should we rent while waiting?

zain

Ok, Heres the situation. We had our property on the market for one week and had an offer at the asking price. The buyers are very keen to get on with this ( as they are due to get married in June) and would like things to be sorted by end of April/ beg May. We haven't found anything to buy and unlikely to find something which is not in chain and indeed will delay the process.

We have suggested that we may consider renting while we find something to to keep the buyer from pulling out. What shall we do? Are there any advantages to renting? Also, we probably would have accepted 5k or so below the asking price so don't feel we lost out financially. Also would we be able to get interest of the sold property? And how does capital gains tax work etc?

Any thoughts would be much appreciated?

BusyLizzie_3

Advantage of renting is that it buys you time to find your ideal property, and puts you in a strong position when you do come to put in an offer on a property (no chain).

Disadvantages as I see it are that you will end up moving twice (and paying two lots of moving costs), you may be tied into a six-month or even a 12-month rental contract, and that house prices could increase in the time you spend in rented property. This happened to some friends of ours recently - they sold their house very quickly and moved into rented property so as not to lose their buyers. They thought they would find a property very quickly, but in fact it took them a year (lost out on three properties in that time through sheer bad luck) and they estimate it cost them £20,000 more than it would have done the previous year.

Doozergirl

You don't pay Capital Gains Tax on your main residence. The proceeds from the sale, minus the mortgage are yours to invest until you buy again, so will get interest.

Most contracts are six months. Even though you do have to move twice, you have more luxury of not having to do it all in a day so you don't necessarily have to pay a proper removal company. I 'sort of' stepped off the ladder and rented because I couldn't hack being in a chain any more. It's not buying and selling that's most stressful, it's being in a chain and trying to cope with egos from both directions!

If you decide that renting isn't for you, then I implore you you make a decision quickly and inform your buyers because I cannot count the number of upset buyers that come to this board very unhappy because their vendors 'lied' about moving into rented accommodation. It actually takes some of the trust out of the deal and makes things more difficult for everyone.

Do think about how excited your buyers are to be moving into their own home before their wedding and how much added stress they will no doubt be under. 'Tread carefully for you tread on my dreams' and all that

vansboy

We sold our place back in August, took the offer, as they were in a good position, their buyer was in rented & keen to not spend any more £$£$ to pay his landlords mortgage!

We moved into, another place we already owned, which was empty, fortunatly, but we're still here.

I've posted a couple of threads about the difficulties we've had in finding somewhere & the one place we DO like, is empty & has been for couple years. You'd think the owner would be so pleased to find someone ready, willing & prepared to take on the huge task of renovating his place & not worry about a loooooong chain....

NOPE!! We're still nowhere near getting it - or anywhere else either!!

So think how long you'd be prepared to put up with & pay for 'temporary' accomodation!!

VB

zain

Many thanks for your responses I don't beleive in messing buyers around so we will probably rent if it comes to that. One question: My partner doesn't work so when we sell the property would it make sense to transfer the money to her account so we can claim back any tax on the savings? Are we allowed to do this?

vansboy

Think you'll be unlucky on the savings side of things, but good luck with your sale!

VB

Voyager2002

zain wrote:

Many thanks for your responses I don't beleive in messing buyers around so we will probably rent if it comes to that. One question: My partner doesn't work so when we sell the property would it make sense to transfer the money to her account so we can claim back any tax on the savings? Are we allowed to do this?

If you trust her enough to put all your (joint) money into an account in her sole name, then you can indeed do so. She must then fill in a form (I think it is called R85) that allows the bank to pay interest without deducting tax. She is then responsible for contacting the revenue and paying tax if her total income (including interest) for the tax year comes to more than her personal allowance.