property investment company want my HMO

snickpan

and have suggested taking it over, with a view to buying at todays price, in a few years time. In the meantime, he said he'll cover my mortgage, and I could have a lump sum if I fancy...
What's in it for him, and why wouldn't I just want to sell it today? What system is this?

anselld

Well obviously he gets all the profits plus the capital growth for the next few years at zero capital cost (or the cost of the lump sum which he will probably take out of the selling price anyway).

The real question is what's in it for you? If you want to sell, sell on the open market.

theoretica

If the value rises he gets the profit, if the value falls he finds a way to back out?

tom9980

Is it really not obvious?

no risk for him at all, gets to make a profit while hoping to lock you into a price that he will make a lot of money on if prices rise and he can easily back out of should prices fall.

I am genuinely annoyed that you haven't worked it out yet you run a HMO.

kuratowski

Last time someone asked this it was suggested the "buyer" wanted to use the property for illicit purposes (cannabis farm, before you get any wild ideas!) and would leave the owner with a wrecked property...

snickpan

:rotfl:
:rotfl:
:rotfl:

snickpan

tom9980 Obviously I'd done some of the maths, just fishing for more info. Hard to google, as I didn't know if this method had a name, or any good or bad experiences from my peer group.

tom9980

snickpan wrote: »

tom9980 Obviously I'd done some of the maths, just fishing for more info. Hard to google, as I didn't know if this method had a name, or any good or bad experiences from my peer group.

It is honestly shocking that you and your peers together cannot see all the pitfalls and immediately say no, you are all running a business and between you not one of them told you to run a mile?

It makes me wonder what else you all are not doing.

oddjobbpb

.....run, Forrest, run.....

davidmcn

kuratowski wrote: »

Last time someone asked this it was suggested the "buyer" wanted to use the property for illicit purposes (cannabis farm, before you get any wild ideas!) and would leave the owner with a wrecked property...

Or simply collect the rent from the tenants, not bother passing any of it on to the OP, and leave the OP to deal with the fallout from their mortgage not being paid.

gld73

Speaking from experience, I'd say avoid like the plague. I rented my house in Gloucester to a (one man) company who then let out individual rooms as an upmarket HMO (personal circumstances meant I needed a fast sale or hands-off rental of my house as I was moving a few hundred miles away). He had an option to buy at a very good price for the next 7 years.  He did pay rent for a couple of years, but stopped last year, and now I've defaulted to being the landlord. He does seminars as a property guru and 'mentors' others according to his social media profile, but given he couldn't even buy my house and make an instant £30k profit on the option price, he's not got much property expertise as far as I can now tell.
I'm now stuck having to get the 4 current tenants out as they stopped paying rent on the change of landlord despite me employing a solicitor and well established local letting agency to try and ensure everything was done smoothly if they wanted to carry on living there. So no rent and thousands of pounds going on costs.
Avoid, avoid, avoid!!!