Can I live in a BTL property temporarily?

Melaniep101

Hello folks

I wondered if someone could help with some advice.

To condense a rather long story into a short one:

- Sold our house - buyers keen as mustard
- We've had an offer accepted on a property - vendor being very difficult and has lied to his onward purchase and told them he is chain free. The onward purchase is now not happening and vendor has not found another property (limited and sought after specific area)
- Our buyers are putting us under pressure to chain break and rent - we are reluctant to do this as it means 2 x moving and additional cost for us in rent.

So my question is, if I purchased a cheap BTL property (which is what I have been wanting to do for a number of years), could I live in that property temporarily to a) tidy up the place in prep for tenants b) enable the current chain to happen c) not pay for a rented property?

Not sure if this is even doable, but would appreciate advice.

Btw - we are looking for other houses, but not much coming on the market at the mo...

Thanks in advance.

mgarl10024

I think the tricky bits will be your mortgage (assuming you need one) and the insurances.

re: the mortgage - you might have to buy it with a residential mortgage and then apply for consent to let. Or you might be better buying it with a BTL mortgage but some have conditions about you living in the property and not tenants.

Insurance wise the same. You might need residential insurance which you then cancel (could be expensive) and replace with landlord insurance when the property becomes BTL. I doubt you could get landlord insurance from the start if it was you in the property.

Some investigation required. An independent mortgage broker might help?

Guest101

Why would a BTL be quicker than you finding your own home?


In reality there'll be tenants in place and you wont be able to evict quickly.

Pixie5740

If you require a BTL mortgage for the BTL then living in the property will be against the terms of your mortgage.

I'm not sure why you think it will be faster to find the right BTL property than the right home though. If anything I would have thought that finding an investment property to give the best returns would take a little longer.

Cornucopia

Have a look at let-to-buy mortgages. These are intended for these kinds of situation (although I'm not 100% sure about this exact scenario). My LTB mortgage with BM Solutions was very flexible in respect of waiting for the purchase of another property to go through. Other providers are available.

You need proper advice from a Broker, really, as the numbers also have have a bearing on whether this is doable, and also the underlying question as to whether the scenario works. You will struggle if you need more than 75% LTV on the "BTL" property.

WRT insurance, either get a pay-monthly policy, or go with a large insurer (Direct Line?) who are known for both residential and LL insurance. They should easily be able to flip the policy at the appropriate time. Bear in mind that your Mortgage provider may have their own preference for LL's insurer, which may or may not suit you. (For BM it is L&G).

Cornucopia

Guest101 wrote: »

Why would a BTL be quicker than you finding your own home?

Presumably, they do not want to lose the house they are buying.

In reality there'll be tenants in place and you wont be able to evict quickly.

I think you may have misunderstood the scenario. The OP wants to purchase a second home to live in to break the chain. Once the purchase on their original intended house goes through, they plan to let the second home.

Guest101

Cornucopia wrote: »

Presumably, they do not want to lose the house they are buying.

I think you may have misunderstood the scenario. The OP wants to purchase a second home to live in to break the chain. Once the purchase on their original intended house goes through, they plan to let the second home.

"Btw - we are looking for other houses, but not much coming on the market at the mo..."

I don't think that's quite right?






Anyway my point still stands. Buying a BTL takes longer than a normal purchase. Primarily as the BTL would likely have tenants in who could have months or years left on the lease.


there's due diligence to consider, such as yield, market rates etc. On top of the 'normal' house buying procedures.

Melaniep101

Cornucopia wrote: »

Presumably, they do not want to lose the house they are buying.

I think you may have misunderstood the scenario. The OP wants to purchase a second home to live in to break the chain. Once the purchase on their original intended house goes through, they plan to let the second home.

Thank you Cornucopia - that's exactly right. We just need more time to either complete on the current house or find an alternative. Our next purchase is intended as a forever home (hate that term) so we are looking for something quite specific. If we could find a <£125k chain free BTL to temporarily live in, it might well be quicker than waiting for the dream house.

Melaniep101

Guest101 wrote: »

"Btw - we are looking for other houses, but not much coming on the market at the mo..."

I don't think that's quite right?






Anyway my point still stands. Buying a BTL takes longer than a normal purchase. Primarily as the BTL would likely have tenants in who could have months or years left on the lease.


there's due diligence to consider, such as yield, market rates etc. On top of the 'normal' house buying procedures.

We are looking for alternatives to the one we have offered on as back up really. We don't have much confidence in the vendor.

There's lots of 2 up 2 downs on the market in the area we want to move to, that are chain free and without sitting tenants (theres also lots with sitting tenants too btw).

Agree that theres lots of du diligence to be done, but its just in the idea phase at the mo.

xylophone

Could the vendor of the house you want not move into rented accommodation?

Cornucopia

Guest101 wrote: »

Anyway my point still stands. Buying a BTL takes longer than a normal purchase. Primarily as the BTL would likely have tenants in who could have months or years left on the lease.

Clearly, they want an empty house to live in, as opposed to one with sitting tenants.

Obviously, they would be buying that from the open market, with vacant possession, and are interested in the "BTL" angle as a future investment and to help them through these chain difficulties.

there's due diligence to consider, such as yield, market rates etc. On top of the 'normal' house buying procedures.

Indeed. Although in some areas, these would be trivial. Where my LTB house is, the rent is 329% of the (originally 50% LTV) mortgage payments, for example.