Would you buy a tenanted property for less or pay more for a vacant house?

Peggy0628

Soot2006 said:

Given what you say about not needing a mortgage for this property, I'd recommend getting a small mortgage and then buying the house you really want to have and live in.

I like this area and the houses here. The floorplan is identical to the house I live in now. It suits my needs (single, childless) and is in perfect location for my needs (work, shops, transport links - I have no car). It needs a bit of upgrading like most of the houses on the street (better insulation, solar panels and such) but it could be my forever home. I'm not looking at houses in different parts of town.

Bendy_House

I don't know, but Shelter suggests it typically takes: two months notice period, followed by a Court Order if needed - a few weeks to several months - and Bailiffs if that's needed too - a further 'several weeks'.

Yes, there will likely be delays due to C-19 backlogs, but - again I don't know - but Niv's worst case scenario would appear to be a bit excessive?

And I have no idea how much this costs, but I suspect it isn't a lot.

That is provided you do everything by the book, Peggy.

Horrible situation for a LL to be in, but it's also a fact of life, and you need a home just like they do. We can't be martyrs to successive gov's lack of social house building.

Check their tenancy agreement carefully to ensure they don't have further rights over the 'usual' - again, I don't know what these are or could be! - and perhaps consider a mutually beneficial arrangement, where you will give them the equivalent of, say, the notice period's rent if they agree to move without any issues?

Also check that the previous LL has done everything by the book, including securing their deposit in an approved scheme, etc. I don't know if the liabilities of the current LL doing summat wrong are transferred, but that could be a right pita if it is.

Peggy0628

Bendy_House said:

I don't know, but Shelter suggests it typically takes: two months notice period, followed by a Court Order if needed - a few weeks to several months - and Bailiffs if that's needed too - a further 'several weeks'.

Yes, there will likely be delays due to C-19 backlogs, but - again I don't know - but Niv's worst case scenario would appear to be a bit excessive?

And I have no idea how much this costs, but I suspect it isn't a lot.

That is provided you do everything by the book, Peggy.

Horrible situation for a LL to be in, but it's also a fact of life, and you need a home just like they do. We can't be martyrs to successive gov's lack of social house building.

Check their tenancy agreement carefully to ensure they don't have further rights over the 'usual' - again, I don't know what these are or could be! - and perhaps consider a mutually beneficial arrangement, where you will give them the equivalent of, say, the notice period's rent if they agree to move without any issues?

Also check that the previous LL has done everything by the book, including securing their deposit in an approved scheme, etc. I don't know if the liabilities of the current LL doing summat wrong are transferred, but that could be a right pita if it is.

I haven't got that far yet, I've not even contacted the real estate agent. I'm still trying to work out if buying a tenanted house is a good idea or not, given the lower price. Might wait a few months to see what happens with the house prices but from what I've seen on the property selling sites, the tenanted properties are always quite a bit cheaper than vacant ones (with the exceptions of houses in need of some major works). Who knows, maybe I will be able to buy a vacant house for the price of this one a bit further down the line.
But I like to explore all options, just in case.

theartfullodger

Depends.  If tenanted property is regulated (Rent Act tenancy) no copies of any paperwork I'd walk away, not even offer.

But if tenants are say last year students, paperwork perfect, great rent payment record might offer near market price.

newlandlord555

85000 invested last 2 years in flat to let. Excellent idea, 14000 up and counting. Be careful where you buy and you are on a winner. :}

newlandlord555

I bought it tenanted no problem. 

jj_43

Peggy0628 said:

My plan is to get the tenants out asap (depending on the exact terms of their tenancy agreement - I don't know the exact details).
I don't need a mortgage to buy this tenanted house but would need one to buy a more expensive vacant house, that's why I'm considering this option. So technically, if the tenants stopped paying rent, it would not cause me any problems (well, it would be a problem but there would be no risk of defaulting on mortgage and such).

So you are a cash buyer, what’s your difficulty with just buying a straightforward vacant home with a 20% mortgage? Why in this roundabout way?

Are you sure it is not 20% lower valuation for another reason? State, condition, some reason you don’t understand?

Peggy0628

jj_43 said:

So you are a cash buyer, what’s your difficulty with just buying a straightforward vacant home with a 20% mortgage? Why in this roundabout way?

Are you sure it is not 20% lower valuation for another reason? State, condition, some reason you don’t understand?

I like the house and the area, but about half the properties here are owned by private landlords so not many vacant properties come up for sale. I've seen the photos and to be fair, the house seems to be in better condition than the one I live in. I don't want to move out of the area as I've been here quite some time and have connections here. Whenever a tenanted house goes on sale, it's always cheaper than non-tenanted ones (probably why the area's so popular with landlords).
The problem with buying vacant house is the chain. It can make things drag out forever or even collapse, with buying from a landlord, there is very little risk of the sale falling through.
I don't think 20% lower price is that unusual for the area. Few months ago (around Easter) there was a tenanted house for sale than was 45% cheaper than a vacant house (it got snapped up within days).
Obviously, I haven't viewed the house or made any enquiries, so can't know for sure. 

jj_43

As a landlord I can see a way to achieve this, and also see some very big problems with your idea. It is also a good reason why landlord licensing should be introduced. 

[Deleted User]

Buying a tenanted property at a discounted price.
If it was straightforward and a 'good' buy, chances are that a landlord would snap it up
Tread very carefully, take expert legal advice and approach it with your eyes wide open.