Can a landlord take a holding deposit on a property he doesn't yet own ?

PoloPonyHampshire

I went to view a property back in July. It was advertised on Gumtree as being available mid August which suited us fine. After looking at the property and both the landlord and I saying we thought it would work well for us both he then told me it was a buy to let investment property and they had not yet completed on the sale but that it should all be sorted by mid August.

I said I that would be okay as we were in no huge rush to leave and paid him £500. It has now dragged on and on and we are at the 18th of September with no completion date in sight am I now in my rights to pull out and get my holding deposit back as I have given notice where I am after the landlord repeatedly assured me that all should be sorted by the middle of September, only to be told that it wont be this week definitely and they still haven't completed and transferred the monies across,

Can I get my deposit back or am I out of luck as I knew the situation and agreed to it initially ?

TIA

eddddy

PoloPonyHampshire wrote: »

Can I get my deposit back or am I out of luck as I knew the situation and agreed to it initially ?

It depends on what you and the LL agreed.

For example,

• If you agreed that it was a holding deposit for a flat that you could move into in mid-August, then it sounds like the LL has breached the agreement, and claim the £500 back.

• If you agreed that it was a holding deposit for a flat that you could move into whenever the purchase completes, then it sounds like the LL hasn't breached the agreement.

(But are you sure that you're not being scammed? Do you have any proof of the LL's identity and/or home address?)

davidmcn

No reason in principle why you can't agree things in principle or place deposits with landlords before they complete their purchase - but what were the terms of the holding deposit other than "this is a holding deposit"?

Pixie5740

PoloPonyHampshire wrote: »

I went to view a property back in July. It was advertised on Gumtree as being available mid August which suited us fine. After looking at the property and both the landlord and I saying we thought it would work well for us both he then told me it was a buy to let investment property and they had not yet completed on the sale but that it should all be sorted by mid August.

I said I that would be okay as we were in no huge rush to leave and paid him £500. It has now dragged on and on and we are at the 18th of September with no completion date in sight am I now in my rights to pull out and get my holding deposit back as I have given notice where I am after the landlord repeatedly assured me that all should be sorted by the middle of September, only to be told that it wont be this week definitely and they still haven't completed and transferred the monies across,

Can I get my deposit back or am I out of luck as I knew the situation and agreed to it initially ?

TIA

Gumtree? How sure are you that the person you paid £500 to is even buying the property in the advert?

Assuming this isn't a scam then the return of the holding deposit depends on the terms you agreed to when you handed the money over. There's no law saying a landlord can't take a holding deposit for a property they don't yet own. In fact a landlord doesn't even need to own the property to be let at all, for example in the case of subletting.

Cakeguts

How could you have viewed a property that the person didn't own? If he hadn't completed on the sale he would not have been able to get access.



It sounds to me as if you have been scammed. Was the property cheap for where and what it was?

PoloPonyHampshire

Thank you all for your replies.

From what you say he was perfectly within his rights to rent the property before he completed.

I think then that it is just unfortunate that I have run out of time and have given notice so have to be out of our current home by the 2nd of October and I will have to hope that he can complete before then.

I did check him out before I paid the deposit, he lives in the next village and runs a local business.

Thank you all again.

theartfullodger

Stronger than that, you don't even have to own a property to be the landlord. Just have authority to rent it out. Very common with "guaranteed rent" schemes/scams letting agents operate....

Cakeguts

PoloPonyHampshire wrote: »

Thank you all for your replies.

From what you say he was perfectly within his rights to rent the property before he completed.

I think then that it is just unfortunate that I have run out of time and have given notice so have to be out of our current home by the 2nd of October and I will have to hope that he can complete before then.

I did check him out before I paid the deposit, he lives in the next village and runs a local business.

Thank you all again.

He could only let it before he completed with the permission of the owner. I still don't understand how he got access to someone else's property to show you.

PoloPonyHampshire

Hi all, I honestly don't know how he was able to obtain the keys, the vendors were away on holiday so maybe they left him the keys? I just don't know.

Comms69

Taking a holding deposit is obviously fine 99/100 times. A landlord will want someone to move in straight away so makes sense; but I would only ever agree to this if contracts had been exchanged and he could prove this

Margot123

I know he has said 'a buy to let' but it may not be that. He may have used the term to simplify things.

He could be transferring an inherited property into his name (hence having access)/letting out as an Attorney for a relative or friend in a care home (and waiting for formal registration of POA). Perhaps he is Executor of an estate and is awaiting the Grant of Probate.

There could be any number of reasons............