An unusual "want to give notice to tenant" situation.

ProDave

What would you do in this situation, I will try and keep it brief.

in 2014 we had just started building our new house and we put the old house on the market.  It was for sale for 3 years with only a handful of viewings and no offers.  Where we are then had not started to climb out of the 2008 housing market crash (there are still parts of the UK where the market is still slow and prices are still below 2008 levels)  We had lowered the price as much as we could, but if we went any lower then the sale price of our old 5 bedroom 4 bathroom detached house could well have ended up less than the build cost of our new 3 bedroom house, and there is no way I was going to pay to downsize.  The asking price was already lower than a surveyors valuation.

The only interest we had was someone that wanted to rent it with the goal of buying it. It was all to do with them being self employed and needed a certain period of trading before the could get a mortgage.  Reluctantly we agreed and it is let on a Scottish Short assured tenancy.  There is no written agreement about eventually buying it, but initially we talked about buying it after 2 years.  That later got extended to 3 years another deadline that has passed.

Earlier this year just before Covid appeared we had a brief communication about the third year accounts being almost complete and she was going to see the mortgage adviser again. but covid has killed all that for now as her income has plummeted and she is now unable to even afford full rent so we are accepting half rent at the moment.

In the mean time while she has been renting it, the property market here has finally woken up.  At the start of the year houses were selling fast, and prices were rising. Who know what the market will be like when it re starts.

Now we still have not finished the new house.  The build has been much slower than expected due mainly to the lack of sale and us constantly being short of money building as we earn it.  And the final factor is in just over 2 years I plan to retire and we REALLY need the equity locked up in the old house by then as we have a number of purchases we want for things we want to do in retirement.

My inclination is to give her until next spring, which would then have been 4 years renting the house, and if she still can't buy it then, to evict her and put it back on the market.  Subject of course to the market not having crashed again.

So I am wondering how to approach this?  I find she is a very hard person to talk to about her plans, she does not want to reveal any real details to us just wooley comments like she still wants to buy it, she is dealing with a mortgage broker etc, but nothing certain.  My concern is there is a big gulf between wanting to buy it and being able to buy it.

So if you serve notice to quit, does it have to be a fixed term in law, i.e. the tenancy states 3 months.  I guess my question is would it be possible to serve notice now, to vacate on 1st April 2021?  That would make the situation entirely clear, give her 8 months to make an offer to buy or prepare to move out somewhere else.

Would that best be achieved at this stage serving a formal notice?  indeed can you serve a formal notice that long?  Or would it be best served with some form of "letter of intent" that we need the sale tied up somehow soon and if there is no progress with her buying it that we will serve notice to quit with the due notice later on.

greatcrested

So in brief:

* you let a property in Scotland in 2014 using the now out-dated SAT

* you have presumably complied with all Scottish tenancy regs eg LL registration etc?

* you had vague and legally meaningless discussions about a future sale, which we can ignore

* you are considering ending the tenancy and don't know how.

As I'm not familiar with Scottish tenancy law, I'll simply point you a Shelter Scotland:

https://scotland.shelter.org.uk/get_advice/guides/renting_privately

ProDave

Yes the tenancy is all legal, we are registered etc.  I know how to serve notice.  So it is more of an ethical question. Would you give her more time in case she does come good on her verbal claim to want to buy it? or would you have lost all patience already.

Yes it is under the old form of Scottish SAT and i understand that remains in force. But even if it came under the new version, wanting the property back for your own use or to sell it, remains a valid reason to serve notice.  I am not wanting to evict her for any other reason, we need it sold fairly soon.

I want to avoid making a legal own goal.  For instance if I could, and did, serve notice to quit but not until next April, if she then stopped paying rent would that stop me serving another notice to evict her sooner?

My inclination is an informal letter stating that if there is no progress on her intention to buy by next April then we will be serving notice to end the tenancy so the house can be sold on the open market.

NewShadow

I'd suggest at this point it's more a letter to communicate your intent to your tenant:

Dear X,
As you know, we did not intend to become long term landlords and therefore wanted to give you notice that we intend to place our property back on the market in April 2021 with vacant possession.

Do you still intend to make us an offer for purchase? If not we will be issuing you notice on X date.

[optional] We are aware of your current financial difficulties and so would be happy to discuss early surrender if that would facilitate your move.[/optional]

Kind Regards,

ProDave

theartfullodger

Your SaT is, because no paperwork, actually an AT (as no AT5 served prior to signing SaT) so you have no "no fault" option to serve notice and would need to go with breach of tenancy eg rent arrears.

Be very very nice and generous to tenant as they can pretty much guarantee you can't evict if they keep paying rent. (I made similar mistake when I started as a Landlord, thinking I knew what I was doing.  Ah, Hubris)

Artful:. Scottish Landlord since 2000

davidmcn

theartfullodger said:

Your SaT is, because no paperwork, actually an AT (as no AT5 served prior to signing SaT)

I think it's just no written agreement about the purchase option, not no written tenancy agreement.

In which case they can serve notice, it's legally valid to serve it earlier than needed, and it doesn't preclude taking action if there's a breach by the tenant.

AdrianC

ProDave said:

So it is more of an ethical question.

Ethics is a long way south of Scotland.

This is business. She is not your friend, she is your customer, your tenant. You are not her friend, you are her landlord.

She is on a certain type of tenancy, and the notice rules are X. Comply with them and then you can start to regain possession if required.

Simple fact: She's had six years of the two, maybe three, that you initially discussed.

It may be that the notice gives her the kick up the chuff to get things moving on the purchase.
It may indeed be that she wants to purchase, but simply can't afford to. Oh, dear, that's a shame. Next.
Or she may just be quite happy as she is, and is stringing you along.

ProDave

theartfullodger said:

Your SaT is, because no paperwork, actually an AT (as no AT5 served prior to signing SaT) so you have no "no fault" option to serve notice and would need to go with breach of tenancy eg rent arrears.

Be very very nice and generous to tenant as they can pretty much guarantee you can't evict if they keep paying rent. (I made similar mistake when I started as a Landlord, thinking I knew what I was doing.  Ah, Hubris)

Artful:. Scottish Landlord since 2000

It is most definitely a legal SAT with form AT5 served prior to signing the SAT the tenancy and all the paperwork was drawn up by a Scottish Letting agent.

The only "informal" bit is anything about making an offer to buy the house.  It was only the hope that she would buy it that persuaded us to enter a SAT otherwise it would just have remained for sale.

The suggestion above just to give notice of the date we intend to put the house on the market with vacant possession, perhaps with a not that we hope she will be able to make an offer for the house before then so so we don't have to serve notice to end the tenancy.

theartfullodger

ProDave said:

theartfullodger said:

Your SaT is, because no paperwork, actually an AT (as no AT5 served prior to signing SaT) so you have no "no fault" option to serve notice and would need to go with breach of tenancy eg rent arrears.

Be very very nice and generous to tenant as they can pretty much guarantee you can't evict if they keep paying rent. (I made similar mistake when I started as a Landlord, thinking I knew what I was doing.  Ah, Hubris)

Artful:. Scottish Landlord since 2000

It is most definitely a legal SAT with form AT5 served prior to signing the SAT the tenancy and all the paperwork was drawn up by a Scottish Letting agent.

The only "informal" bit is anything about making an offer to buy the house.  It was only the hope that she would buy it that persuaded us to enter a SAT otherwise it would just have remained for sale.

The suggestion above just to give notice of the date we intend to put the house on the market with vacant possession, perhaps with a not that we hope she will be able to make an offer for the house before then so so we don't have to serve notice to end the tenancy.

Apologies I'd misunderstood your post #####Reluctantly we agreed and it is let on a Scottish Short assured tenancy.  There is no written agreement ..#####

OK, good, so as long as you can PROVE AT5 was served prior to SaT signing great: If you can't prove it, tenant (who may be viewing, this is a free & open forum) may well be able to prevent eviction.  The way SaL 

https://scottishlandlords.com/

- handled that was having date & times of the signing the many documents with signatures.

Just serve the standard "no fault" SaT notice and hope the FTT is sitting by the time the notice expires.  Suggest you join SaL and use all their excellent paperwork.

FTT as you no doubt know are not currently sitting..

https://www.housingandpropertychamber.scot/home

Slàinte mhath!

ProDave

I hope the tenant does read this and joins the dots, and realises we are losing patience.  Perhaps she will come and have a more meaningful conversation with us about how her plans to buy it are progressing rather than being so evasive and non committing.

[Deleted User]

Believe you me, if she wanted to buy and could afford it anytime within the last six years, she would have done so.  Six years is long enough.  Personally, I'd just serve notice and act on it as soon as its legally possible to do so, so you can get on with the rest of your life.  As an up, you had a rental income when it was difficult to sell the property but it seems you feel this should be able to happen now, so time to make it so you can sell.