Buying 'pre-let' property?

coolasacucumber

My wife and I rent a house that we like, and are soon to be inheriting enough to buy a cheap property in the town we live in.


We have thought about buying somewhere for ourselves to live, but we aren't sure if we will be staying locally for a long time.


There are local properties for sale with current tenants - an option we are only just considering, but we have no idea about it.


Can anyone provide any guidance, advice or tips - positive or negative please?


Thanks in advance.

macman

No problem if you don't want vacant possession, and you don't need a mortgage.

G_M

So you want to be landlords? Read

* New landlords: advice, information & links

* Letting agents: how should a landlord select or sack?

If buying a property with tenants in situ, check carefully
* what type of tenancy they have]
* when they moved in
* what deposit they paid (this needs transferrig to you), when it was paid, when /where it was registered
* what rent payment record they have? Arrears? Now or in the past
* their incomes, references, credit history from when they moved in
* whether the property has a GSC? EPC?
* what correspondance exists to/from them regarding repairs etc
* whether, after meeting them, you will feel comfortable having them as tenants, and what their longer term intentions are
* what the neighbours think (this applies to an empty property too!)

audigex

If they have a sitting tenant, you need to either wait for the tenancy to end or buy their tenancy out.

If you want to buy it as a rental investment, while also allowing you to buy a property (good for security, as you can move back in on reasonably short notice) then it's a good bet, but it's no good if you want to buy a home.

What are you actually trying to achieve?

eddddy

G_M's list is fairly exhaustive. But also check that the current rent is realistic (and obviously that the purchase price is realistic).

Occasionally, you see scams where an LL wants to sell an investment property, so gets their mate to sign an AST with an unrealistically high monthly rental. That inflates the yield, and hence inflates the selling price.

Then once sold, and the tenant leaves (or you have to evict them), you find that you can only re-let at a much lower rent.

coolasacucumber

Thank you for the suggestions & advice, a few bits for us to look into there.


What we want? Basically to invest this sum of money in the best way, my current thoughts being property. We aren't ready to commit to a house or area yet due to work potentially changing locations, but the thought of having a house in an area that we know well and have friends & family to come back to at some point seems like a good plan.