Should I sell to my tenant?

PasturesNew

If you used an agent to find a tenant, read that agreement carefully, they might still sting you for the 1% commission (or whatever their usual charge is) if you sell to your tenant.  It is usual for a tenant finding agency to have that in their contract "just in case".  

There was a couple on these boards about 10 years ago who'd bought from their landlord.  They did it 'secretly' by handing in their notice and going through the entire moving out procedure with the agent.  On the day they 'moved out' they had already owned it a week or so.... they loaded all their stuff into a van that then sat round the corner; their garden furniture was handed over the fence to a neighbour for 2-3 hours.  Once they'd handed back their keys and left... and the agent had locked up and gone ... they moved back in.  Got away with it!

franklee

Lottir said:

I didnt really think about it in terms of lost rent. I assumed people would look round while people were still there and then maybe I'd have one month with no rent coming in. But I can see how it could be a factor.

OK well walk through the logistics of marketing with the tenant in place.

A few things to consider, obviously there are more than this.

Appointments have to be with the tenant's agreement so that may limit appointment times.

There is no requirement for them to present the property in pristine condition. So dirty dishes in the sink, unmade beds etc. etc.

You have to give them at least two months notice. Even then they aren't guaranteed to leave so you may have to follow through with court to get a possession order etc. which can take several more months.

You would be mad to exchange contracts before the tenants have vacated, although some landlords take this risk, unless you are selling to another landlord who doesn't require vacant possession on completion.

You would need a buyer who is happy to wait while all that happens.  If they are in a chain you need the whole chain to wait.

The above may limit the buyers who are interested in spending money on surveys etc. before the tenants have left.  In short I would not expect to get top price while the tenants are still there.

Alternatively the tenants may be anxious to secure their new home and find somewhere to rent giving their own notice before for sale has progressed.

AnotherJoe

Another vote to sell at 193k 

dinkylink

Is there any harm in saying to your tenants you'd like to sell to them and would split the difference between 200k and 193k? Worst case they won't budge and you say oh go on then, 193k it is...

Doozergirl

PasturesNew said:

If you used an agent to find a tenant, read that agreement carefully, they might still sting you for the 1% commission (or whatever their usual charge is) if you sell to your tenant.  It is usual for a tenant finding agency to have that in their contract "just in case".  

There was a couple on these boards about 10 years ago who'd bought from their landlord.  They did it 'secretly' by handing in their notice and going through the entire moving out procedure with the agent.  On the day they 'moved out' they had already owned it a week or so.... they loaded all their stuff into a van that then sat round the corner; their garden furniture was handed over the fence to a neighbour for 2-3 hours.  Once they'd handed back their keys and left... and the agent had locked up and gone ... they moved back in.  Got away with it!

Phirefly, I remember well.  True story!    We're still internet buddies.  🙂

babyblade41

Snap their hands off and sell..you'd be mad not to, and they know the little foibles the flat has so not a lot on nit picking 

I wouldn't entertain buying somewhere with tenants in situ so your limited if you sell on the open market.  Tenants don't always leave when you want to ..Some even come on here and are told to sit tight until eviction from a court ..your choice, but know which way I would go 

Skiddaw1

Another vote for selling it to them.

Mr S and I got onto the housing ladder that way (we bought the flat we'd been renting). Worked for the LL and worked for us.

warby68

In the same way as a few k doesn't matter when buying a house you really really want because it fades over time, then a few k less for a sale that is convenient has its own intrinsic value.
The void period could easily be lengthy - sales fall through all the time.
Also your tenants are invested now and could easily not be overly cooperative if you try and sell elsewhere.
If 193k is their new 'first' offer after you suggested £200k, there is no reason why you couldn't try a bit more negotiation to split some of the difference, especially if you tell them you really want them to have it. How about £195k and its yours ? You can still say 'oh, go on then' if they don't bite.

franklee

This thread is worth reading for how tenants look from the buyer's point of view:
https://forums.moneysavingexpert.com/discussion/6106335/vendor-hasnt-given-the-tenants-notice-to-vacate