Need to sell - propery has tenant

jameslester78

About 10 years ago I bought a flat, got made redundant, moved to the other side of the country for work, planned to move back eventually so rented it out rather than sell.

10 years and several tenants later, there are no signs of me returning; me and partner want to buy a place to live, so I have to sell else I open myself to higher rate of stamp duty (wouldnt be selling otherwise).

The property management company have told the tenant I want to sell and offered him first option, he doesnt want to buy. His contract expired. I dont want to be an !!!!!! and kick him out without warning so I offered him a final 6 month contract, no rent increase (actually he has never had a rent increase) and the option to exit the contract at any point that he finds a new place to live without any penalty.

No response.

management company ,one month ago regarding contract "Just to let you know that we haven’t heard from the tenant yet in regards to the below. His mobile hasn’t the facility to leave a voicemail either."

Realistically (I doubt he is going to respond now) what can I do (I dont want to deal with him direct, I really want to get the flat sold as soon as possible, Im happy to change management companies, I would be happy to sell with sitting tenant but i have been told this is almost impossible - is this true?)

theoretica

It certainly isn't true all over the country - depends on how desirable the property is to landlords. It is of course easy to sell any property - for a low enough price! I would ring up a local estate agent for a chat.  Do they have people looking for BTL properties like yours?

What are very hard to sell for a decent sum are properties with secure tenancies for a trivial rent

BlueC

Explain what you mean about opening yourself to a higher rate of stamp duty? My understanding is that you are already not a first time buyer so you won't get reduced FTB rates, and the property you're buying is presumably for yourself so you won't pay the second-property rates either. You'll just pay standard stamp duty regardless of whether you sell this flat or not.

[Deleted User]

Presumably the reason you are selling is that the income from the rental isn't worth it, being eaten up by management fees and maintenance costs. So obviously anyone looking to buy with tenant in situ is going to look at it and realise they can't make any money.

When you become a landlord you take on responsibility. You own someone else's home, and the law gives them rights. If the tenant doesn't want to move out then you can try to force them to, but it's a long and expensive process. As it should be, making someone homeless is a serious matter.

If you can wait until your tenant decides to go that would probably be the best option. If not... Well, sorry, you took on the responsibility of owning another person's home, and that means giving up the flexibility to sell whenever you like.

p00hsticks

BlueC said:

Explain what you mean about opening yourself to a higher rate of stamp duty? My understanding is that you are already not a first time buyer so you won't get reduced FTB rates, and the property you're buying is presumably for yourself so you won't pay the second-property rates either. You'll just pay standard stamp duty regardless of whether you sell this flat or not.

I don't beleive that's true - the OP currently owns one property. If they buy another they'll own two, so the purchase will be subject to the higher rate SDLT (assuming we're talking England here). The fact that they are buying it to live in is not relevant.

Slithery

BlueC said:

Explain what you mean about opening yourself to a higher rate of stamp duty? My understanding is that you are already not a first time buyer so you won't get reduced FTB rates, and the property you're buying is presumably for yourself so you won't pay the second-property rates either. You'll just pay standard stamp duty regardless of whether you sell this flat or not.

OP will be increasing the number of properties that they own so the additional SDLT will be due.

dimbo61

Sorry BlueC but if the poster owns one property and buys a second property he pays not just stamp duty but 3% extra.
Start eviction process ASAP as you have a much better chance of selling a vacant property than one with tenant/s 

BlueC

[Deleted User] said:

Presumably the reason you are selling is that the income from the rental isn't worth it, being eaten up by management fees and maintenance costs. So obviously anyone looking to buy with tenant in situ is going to look at it and realise they can't make any money.

When you become a landlord you take on responsibility. You own someone else's home, and the law gives them rights. If the tenant doesn't want to move out then you can try to force them to, but it's a long and expensive process. As it should be, making someone homeless is a serious matter.

If you can wait until your tenant decides to go that would probably be the best option. If not... Well, sorry, you took on the responsibility of owning another person's home, and that means giving up the flexibility to sell whenever you like.

This is a load of nonsense. The tenant is on a periodic tenancy so he could just give them "notice to quit". Normally this is 2 months but due to covid it is currently 4 months. See: https://www.gov.uk/tenancy-agreements-a-guide-for-landlords/ending-a-tenancy

But the bigger question is why the OP thinks he will have to pay more SDLT on his purchase if he keeps this BTL property.

SavingPennies_2

[Deleted User] said:

Presumably the reason you are selling is that the income from the rental isn't worth it, being eaten up by management fees and maintenance costs. So obviously anyone looking to buy with tenant in situ is going to look at it and realise they can't make any money.

When you become a landlord you take on responsibility. You own someone else's home, and the law gives them rights. If the tenant doesn't want to move out then you can try to force them to, but it's a long and expensive process. As it should be, making someone homeless is a serious matter.

If you can wait until your tenant decides to go that would probably be the best option. If not... Well, sorry, you took on the responsibility of owning another person's home, and that means giving up the flexibility to sell whenever you like.

Oh give it a rest, and no need to (incorrectly) presume; OP clearly states they want to sell because buying a new property would mean paying higher rate of stamp duty because they already have one.

BlueC

dimbo61 said:

Sorry BlueC but if the poster owns one property and buys a second property he pays not just stamp duty but 3% extra.
Start eviction process ASAP as you have a much better chance of selling a vacant property than one with tenant/s 

I think he needs to speak to a conveyancer about this, because it is my strong understanding that if the property you are buying is for your own main residence (and you are only allowed one main residence) then you will only pay standard SDLT rates on it.

Scotbot

BlueC said:

[Deleted User] said:

Presumably the reason you are selling is that the income from the rental isn't worth it, being eaten up by management fees and maintenance costs. So obviously anyone looking to buy with tenant in situ is going to look at it and realise they can't make any money.

When you become a landlord you take on responsibility. You own someone else's home, and the law gives them rights. If the tenant doesn't want to move out then you can try to force them to, but it's a long and expensive process. As it should be, making someone homeless is a serious matter.

If you can wait until your tenant decides to go that would probably be the best option. If not... Well, sorry, you took on the responsibility of owning another person's home, and that means giving up the flexibility to sell whenever you like.

This is a load of nonsense. The tenant is on a periodic tenancy so he could just give them "notice to quit". Normally this is 2 months but due to covid it is currently 4 months. See: https://www.gov.uk/tenancy-agreements-a-guide-for-landlords/ending-a-tenancy

But the bigger question is why the OP thinks he will have to pay more SDLT on his purchase if he keeps this BTL property.

Because he will. If he were selling a property he currently lives in and buying another place to live in he would be replacing his main residence and exempt from the extra 3%. But he isn't, he would be buying a second  property so has to pay the extra 3%