Buying a House with Tenants in situ?

sammibo

Hello helpful people of the MSE forums!

My partner and I will be viewing a property that is an excellent fit for us on paper. However there is one major issue for us as FtB - it currently has tenants in situ. 
These tenants, according to the estate agent, are happy to 'play ball' and move on when the house is sold. Husband and I have a bad feeling because, well, what if they don't? 

I've done some research and we'd have to become landlords, get a BtL mortgage etc etc, and that is not something we want if they did not move out. 

However, having been evicted ourselves, we're not really cool with booting someone out of a house, and that'd take 6 months anyway with the c19 eviction rules.

Does anyone have any ideas on how this could positively work out for us? Any experiences that might inform us? Should we just move on?

Thanks in advance!

davidmcn

How it works (if you want to buy the house) is that you wait until the tenants have moved out before you do much about it at all. You don't progress the sale and start preparing for the tenants being your problem. Or you just look for properties which don't have tenants in them.

AdrianC

Simply put, you won't exchange and complete until there's vacant possession. Your solicitor is also your lender's solicitor, and they won't do it.

To give them notice legally, the landlord will need to give the tenants six months section 21 notice.
If they don't play ball, it could take a LOT longer before the court grants possession.
If something isn't right about the notice, including any one of several prerequisites not being in place, then the notice is void and the court will not grant possession.

The landlord could come to a mutually-acceptable agreement for an earlier move-out with them - probably by paying them...

Doodlebugs

We’re currently buying a house with tenants in place. We weren’t told about them until after we’d offered and decided to go ahead. We were told all sorts by the estate agent about them leaving. None of it true, so don’t believe anything they say. Though notice had already been served via the letting agents which we have a copy of. 

You don’t exchange until they leave. Our solicitor has asked us to view again once they’ve left so we can confirm we are happy with how it has been left and they have in fact vacated the property. 

It’s a gamble, they may be perfectly happy to leave and you’ll have no issue. Or you could get further down the line, having spent out for surveys, mortgage fees etc and they decide not to leave. Depends how much you want the house. 

sammyjammy

Classic case of landlords wanting their cake and eating it, could turn into a very expensive mistake, I wouldn't even consider it unless it was vacated.

MovingForwards

My home had tenants / family in it, when looking around I was chatting with them, asking things about the property and getting a feel for how the answers were, then I asked what their plans were if I offered and had it accepted. They moved out before I exchanged.

greatcrested

There's a search function for the forum, and this is a very common query. See less than a week ago:

https://forums.moneysavingexpert.com/discussion/6231557/buying-a-house-with-sitting-tenants/p1

steampowered

The tenants must vacate before you exchange contracts. Make that clear when you put your offer in.

Your mortgage company will not lend to you while the tenants are still there - unless you are a cash buyer or buying with a BTL mortgage, you don't have the option of buying with tenants in situ.

You have no guarantee that the tenants will leave when asked, so you are taking the risk of spending legal costs/conveyancing costs, only to find out later that the tenants won't leave for another 6 months. Factor that in when making your offer.

AnotherJoe

sammibo said:

Hello helpful people of the MSE forums!

My partner and I will be viewing a property that is an excellent fit for us on paper. However there is one major issue for us as FtB - it currently has tenants in situ. 
These tenants, according to the estate agent, are happy to 'play ball' and move on when the house is sold. Husband and I have a bad feeling because, well, what if they don't? 

I've done some research and we'd have to become landlords, get a BtL mortgage etc etc, and that is not something we want if they did not move out. 

However, having been evicted ourselves, we're not really cool with booting someone out of a house, and that'd take 6 months anyway with the c19 eviction rules.

Does anyone have any ideas on how this could positively work out for us? Any experiences that might inform us? Should we just move on?

Thanks in advance!

I'm going to disagree. On paper its a terrible fit because you have no idea when it will be available to be lived in.

Realistically, could be 18 months away what with legalities and court delays.

 

theoretica

It can work smoothly - house on my road was advertised and viewed with tenants in and had new owners move in about 2 months later.  But I would want something much more concrete than 'tenants happy to play ball' such as tenants moving to another house on our books next month and EA understanding you won't pay for searches etc until they have moved out.

badger09

My post on the thread linked by greatcrested:

'In Aug we had offer accepted on a great property. Our vendors were buying their ‘forever home’ which had sitting tenants. They were assured tenants would move out. Long story short, tenants did not want to move out (as was their right) and our vendors withdrew their house from the market. 

We wasted more than 3 months, over £1k, and a lot of emotional energy. Rather than lose our sale, we are now in temp accommodation, all furniture etc in storage, until we complete on replacement property. 

Walk away now! There will be other properties'. 

Our EA also told us it wouldn't be a problem, though how he was supposed to know is still a mystery to me.
Vendors told us it wouldn't be a problem. Their vendors didn't think it would be a problem
It clearly was a problem to the tenants who exercised their right to stay put.

Unless you can actually speak to the tenants and ask their plans, I would walk away, or at least keep looking and don't commit any money to this one.