Rent before you buy

nattyb1982

Weird situation, we are selling our house and someone is interested in buying it, they cant buy until May (long story but i currently live away from my husband and our house has been on the market for 2 years so im desperate to to sell our house so he can move up here with me) - has anyone ever rented their house out to someone knowing that they will buy it when they can?
Surely this couldnt be a legality it would only be good faith?
We would be in the same position, we would rent the one we like (currently unoccupied) and buy in May.
This is just a suggestion so please no answers around just waiting until May, its just an option i would like to explore.

Thanks

dimbo61

Sorry this is not a good idea so you would become a landlord and would have to give them a tenancy agreement and do all the landlord things!!!
Gas Safety check, tenant checks, credit checks, Landlord insurance, Consent to Let from Lender ETC
Better to sell and move when house sold
Good Luck

Lucy_Lastic

I rented my present house for 3 months before the sale went through. It worked fine, no tenancy agreement, checks, etc etc.

We had the agreement drawn up by a solicitor that I would buy the house at £x on a certain date and they would sell it to me at £x on that date.

nattyb1982

oh wow thanks Lucy, so you can legally ask someone to buy your house after you have rented it to them!?
Can you remember if there we any penalties for them if they decided they didnt want to buy after renting as im sure they couldnt be forced into it if the worst was the worst and they really didnt want to or their circumstances changed etc?

Errata

I think a vendor can legally rent a property to a buyer, but sensible people ensure contracts have been exchanged with a watertight completion date first.

nattyb1982

ah of course so you can exchange then beforehand, makes perfect sense.

JimmyTheWig

What's the reason for the delay?
If they are happy to move and rent then it can't be a reason that they don't want to move until May.
If it is, for example, them waiting for a default to drop off their credit file, seeing out a probation period at work, etc then they won't be able to exchange contracts until that is all sorted.
So you'd end up in the situation where they were renting your house and might then not buy it. You'd then, potentially, need to evict them before selling to someone else.
Which means you'd be in the situation of renting someone else's house and not be in a position to buy it.

If you could exchange before hand then I think it could work. But I can't see why they would be able to exchange soon but not complete until May when they are happy to live there soon.
Unless they are waiting for a policy to mature to use as deposit, maybe?


The other thing to point out is that whenever I've bought anywhere it has taken longer than 3 months from offer accepted to exchange anyway. I know the average is shorter than this, but that's how it has been for me.
So I'm not sure that May is a terrible deadline anyway, is it?

nattyb1982

hes waiting for a private pension to pay out so he doesnt have to have a mortage and that wouldnt pay out until May. Not a terribly long time to wait but ive lived away from my husband for 10 mths now and this will take us over the year, not awful but a long time! plus we could have someone come in before that and offer before May. Difficult situation

kelpie35

Lucy_Lastic wrote: »

I rented my present house for 3 months before the sale went through. It worked fine, no tenancy agreement, checks, etc etc.

We had the agreement drawn up by a solicitor that I would buy the house at £x on a certain date and they would sell it to me at £x on that date.

I did that many years ago without any problems too.

I know that a lot of things have changed since then but would think your solicitor would be able to advise you.

Good luck :beer:

AlexMac

I'd be a bit cautious as JimmyWig suggests, just in case anything goes wrong, as you'd then be an involuntary landlord, and if (perish the thought) it turned out that his pension lump sum was lost or reduced in a company collapse, a stock-market crash or a meteorite strike (or he'd just got his facts wrong!) you'd only be able to get get him out with a court order and any alternative purchasers would be really deterred.

I assume you've already identified a competent solicitor to act for you on the sale, and that you'd be getting them do draw up any short term tenancy or licence to occuppy if you do go through with this plan? In which case, what do they say about the proposal? I know that our solicitor doesn't like anything out of the ordinary like this, and would advise against.

But thinking more positively- May is only 3 months away and many conveyances take 3+ months anyway. If your buyer is confident they can complete in May, why don't you just start the process now? They make an offer, you accept it and get the agent to issue the memorandum of sale to the two sides' solicitors, his solicitor starts the standard searches, you and yours replies, the local council takes weeks to reply, the buyer puts down a deposit (if he can raise the deposit?) you exchange contracts and before you know it two+ months gave passed. All he's risked is £500-£1k in legal fees, and when his ship comes in you complete.

You could move out ahead of completion if you wish, but is 1-2 month's rent saving really a deal-breaker?

If on the other hand, your buyer is saying that he's not even prepared to confirm his offer and instruct a solicitor until he gets his wad in May, I'd be having second thoughts about his bona fides!

Yorkie1

Irrespective of Lucy's answer, if you accept money from them in rent you must abide by the laws relating to EPC, gas safety certificate, consent to let, landlord's insurance, deposit protection, inventory, etc. And you must declare the income for tax purposes.

If you haven't exchanged, and they change their minds, then you cannot evict them until the end of the fixed period (or six months if that is longer). They have no duty to let you show others round the property while they are in residence, which means you are likely to have a void period after evicting them while you put it back on the market and wait for a new buyer.

As others have advised, better to just prolong the purchasing process without complicating it by letting them move in.