Rent out temporarily after buying?

ElleB80

Hi everyone,

My partner and I are looking to buy our first place. We currently live in London but cannot afford to buy here and so we are planning to buy in Glasgow. We want to buy as soon as possible so that our deposit doesn't devalue, but we may not be able to move to Glasgow immediately because of our jobs and family circumstances, although we would hope to be in a position to move within a year of buying.

If we were to have a residential mortgage, would there be any possibility of renting out before we move? One option we were considering is whether a lodger type arrangement might work, rather than renting out the whole place (we're looking for a 2-3 bed).

Any advice would be greatly appreciated. Thanks in advance.

Money_maker

If you have a lodger then you would need to be living there too.

McKneff

You would need a buy to let mortgage at the very least. Then Google 'being a landlord'
The money you could lose, or have to pay out, or non payers could maybe far outweigh what you would lose if you invested your money till you buy.

bruich76

Well... problems galore with what you are proposing. Mortgage company wont let you put a tenant in because they will want to change the product to a buy to let mortgage - if they even lend on that basis.


Plus there's the obvious concerns about whether the tenant would actually pay the rent, treat the place with respect, or leave when you want them to or, not. All are big ifs and buts.


Gone are the days when serving a notice to a tenant to leave on X day is a given and likewise, the condition you find the property in afterwards would be another concern.


At the end of the day if you rent it out (even if you decide not to tell your lender) he or she might not pay the rent for 6 months, trash the place and refuse to leave. Meaning that you would be needing to come up to Glasgow without access to your own house and needing to go to Court to re-gain possession.


Tread carefully is my advice.

Pixie5740

I think you'll struggle to get a residential mortgage when living and working so far away from Glasgow never mind immediately being granted consent to let. Have you spoken to a mortgage broker about this?

Do you know Glasgow at all and the areas/types of property you want to live in?

To have a lodger (common law tenant in Scotland) you would need to be sharing your only or main home with them. What you are describing does not sound like your only or main home. If you went the whole hog and let the entire property you could need to register with the council as a landlord, letting the property without this registration is a criminal offence. You'd also need to comply with a heap of other legislation such as gas safety certificates (which incidentally you also require if you have a lodger), deposit protection, electrical safety, etc.

pandy19691

It all sounds very problematic to be honest, you might be better off just delaying purchasing until you're actually ready to move.

Renting out a property doesn't actually come cheap when you factor everything in. You can't let on a standard mortgage so you'd need a buy-to-let which would more than likely be higher interest. Estate agent fees can be high, a delay in finding a tenant might mean you have to pay rent where you are now and mortgage. Also, consider any damage a tenant may cause.

And, it's not actually that easy to get a tenant out when you're ready to move in.

theartfullodger

If you are thinking of renting out - lodger or tenant - then only do so after joining SaL
https://www.scottishlandlords.com/
& learning a bit about landlord/tenant law in Scotland.

Even if you live there, genuinely, with a lodger you still need a court order to evict lodger... see
http://scotland.shelter.org.uk/get_advice/advice_topics/renting_rights/common_law_tenancies

You won't be living there.. so they won;t be lodgers/common-law-tenants: To have any chance of evicting legally they would need to have Short Assured Tenancies:
http://scotland.shelter.org.uk/get_advice/advice_topics/renting_rights/renting_from_a_private_landlord/short_assured_tenancies
These must be for AT LEAST 6 months and require an AT5 to be served before tenancy signed: If not they are Assured Tenancies & tenant almost impossible to evict (I know, I failed to get AT5 served when I started: Painful, long-drawnn-out, expensive).

Anything shorter than 6 months, it's an AT, almost impossible to evict if tenant keeps paying rent.

ElleB80

Thanks for the replies everyone. It doesn't seem like a feasible plan but this has been really helpful as discounting options is at least progress in deciding what to do!

theartfullodger

The new Scottish tenancy (yet to be enacted, see...
http://www.landlordzone.co.uk/forums/showthread.php?73142-The-Private-Housing-(Tenancies)-(Scotland)-Bill-2015-completes-Holyrood-process
- is basically a day-by-day tenancy, no minimum period: Tenant can give notice after 28 days: Landlord doesn't have the "no fault" eviction any more (like s21in Engerland) but needs to evict for a reason: Life as a landlord may become interesting in Scotland

AnotherJoe

ElleB80 wrote: »

Hi everyone,

My partner and I are looking to buy our first place. We currently live in London but cannot afford to buy here and so we are planning to buy in Glasgow. We want to buy as soon as possible so that our deposit doesn't devalue, but we may not be able to move to Glasgow immediately because of our jobs and family circumstances, although we would hope to be in a position to move within a year of buying.

If we were to have a residential mortgage, would there be any possibility of renting out before we move? One option we were considering is whether a lodger type arrangement might work, rather than renting out the whole place (we're looking for a 2-3 bed).

Any advice would be greatly appreciated. Thanks in advance.

I suspect your deposit will devalue far more with the additional costs of being a landlord for just one year.

Aside that, as said, with the most likely possibilities that you won't get a mortage buying so far away from where you work,and that you wont get consent to let on it and that you won't get a BTL mortage either.

Just wait until you have jobs there, rent for a while to find a good area and get out of probationary periods and have several months payslips from the new job,