Being at the top of the chain feels so different

SandyN21

Sorry for the long post...

When we bought our doer upper house just over 27 year ago, we were also selling my late parents house plus our own first-time house all at the same time and the stress levels were sky high - this time round it feels so different.

My divorce was finalised at the end of 2019 and we put the house on the market last year as neither of us wanted to still live in it as it's too big and we both want to downsize. Mortgage was paid off a couple of years ago and I took early retirement 18 months ago and ex is retiring in June. We still amicably live in our house and because we are both going to rent before deciding where to move to we've been in a position to reject several offers which were well below our asking price. In December we did accept an asking price offer from a couple but then sadly the wife lost her job so they had to pull out. Last month we got another asking price offer from a couple who have also had an offer and building survey done on their house by their buyers so are keen to move quickly. The earliest they could get a building survey booked for our house is next month.

I had registered with several letting agencies in my area in December as there are 3 specific blocks of flats I'd like to live in why looking for my forever home which may be in a different area. I phoned one of the agencies to see if I could view a flat in one of these blocks once it became empty and before a new tenant moved in and was told this would not be possible unless I wanted immediate accommodation. Is this the norm? And if yes, because it's been so long since I've been through this selling process I can't remember at what stage of selling our house that our buyers can't pull out....and is it at that stage I view a rental and sign a tenancy agreement? And should I get my solicitor to look over the tenancy agreement as hopefully I'll find somewhere before the 1 year agreement is up (the agencies don't do short term lets) so will need to know where I stand if that happened. Thanks  

Sunsaru

To answer your first question, once contracts are exchanged it's pretty much set in stone. Pulling out would result in large financial penalties for the person who withdraws.
Some agencies do do 6 months tenancies as a starter, others do an initial one year. If you're not sure then yea, get you solicitor to have a butchers over the agreement.

MaryNB

The letting agent would want you to move in immediately to prevent a void.  If you want a tenancy agreement in advance you'll have to view places where the outgoing tenant is still there, especially if there's high demand in the area. 

Your buyer can pull out at any stage before exchange. After you've exchanged this would be a good time to sign a tenancy agreement. If you've found a suitable place before exchange you could agree to pay a holding deposit. You'll lose it if exchange falls through and you don't sign the tenancy agreement but at least you won't be on the hook for 6 months of rent. 

pinkteapot

When going from owned to rented you really need 3-4 weeks between exchange and completion, giving you a window in which to find and sign up for a rental property. At the moment this is tricky as more people want same-day exchange and completion due to Covid. I would be honest with buyers from the very start that you need that time between exchange and completion so they can buy a different house if it doesn't work for them.

As soon as you're about to exchange, or the minute you have exchanged, ring round all relevant letting agents and get viewings booked in (view all available, suitable properties over a couple of days). Pick one and get the application in. If it's through a letting agent it can take a week or so to process - especially if they're one that takes up personal references. 

One problem you may have is income. Most letting agents simply won't let you rent unless you have sufficient income - even if you've got cash in the bank from a house sale. We relocated a couple of years ago so sold up and rented and it was a complete pain. We had > £400k in the bank but needed to find work in the new area. We only managed to get our rental because I was still completing my notice period at my job in the old area so the agent put my salary down. Which rendered the process utterly pointless as they knew full well the job was only for another few weeks. Anyway, talk to agents early about whether your retirement income is going to be enough to pass their credit checks.

It's a waste of money to ask your solicitor to look over the tenancy agreement as they're not complicated. A lot of agents want 12-month contracts now but it's worth asking if the landlord would consider an initial 6-month contract and, if not, a 12-month contract with a 6-month break clause (gives you an option to leave at the 6-month point). Don't tell them it's because you plan to buy as they want long-term tenants.

If you do get a 12-month contract it's really not the end of the world. After we relocated it took a few months to settle and get our heads straight and really explore the area and work out the good places to live. It's a slow market here so it then took a few months for a suitable property to come up. We had our offer accepted around 6 months into our tenancy and completed 10 months into it. We were lucky - our landlord let us break contract early, but if we had had to pay the final 2 months rent we would have just chalked it up to part of the moving costs.

SandyN21

Thanks for your replies which have been extremely helpful.  I'm not depending on the sale of the house for rental or my pensions as early retirement was also tied in with redundancy after 40 years with the same company which hasn't even been touched due to what's going on in the world and so no holidays or big spends.

pinkteapot

SandyN21 said:

Thanks for your replies which have been extremely helpful.  I'm not depending on the sale of the house for rental or my pensions as early retirement was also tied in with redundancy after 40 years with the same company which hasn't even been touched due to what's going on in the world and so no holidays or big spends.

That's all good, but bear in mind what I said. All lettings agents care about is your monthly income. They don't care if you've got a huge pot of cash in the bank to pay for it - without an income you'll struggle. I'm guessing as you were with one company for 40 years that your pension income is pretty reasonable. It would just be worth having a quick chat with agencies now to check that that monthly pension income will be sufficient* for the monthly rental prices you're looking at. 

* Sufficient as far as their daft approval process is concerned! We all know you can easily afford it.