Offering to rent a house pending completion of sale

Pat38493

We are in a position where we are interested in making an offer on a house which has vacant possession (post probate).

Meanwhile, we are due to complete on our house sale in about a month and we will be cash buyer, mortgage free.

We were wondering if it was worth offering the seller a price for the house, and also proposing to rent the house from them between our completion date, and purchasing of their house.  

On the face of it this seems like a win win, since the folks who inherited the house are presumably incurring ongoing costs on the house - we would be able to take over those costs and they would get rental income.  Meanwhile we would save storage fees and we would have to rent somehwere in between anyway.

On the other hand, I found a few old threads here from about 10 years ago stating that the seller's solicitor will probably advise them not to do this because if we pull out of the deal after moving in, it will be impossible to evict us until we have been there 6 months.  However, it usually takes the best part of 6 months to conclude a transaction anyway - our house sale has already been ongoing for more than 4 months and we are only just starting to discuss completion dates and contract exchange, and that's with no chain.

Does anyone have any experience or knowledge about this ever having been done successfully?  

Is there any mitigation to the seller's concerns possible e.g. offering to pay 6 months rent up front, with the balance to be offset against the purchase price if the purchase proceeds before 6 months or suchlike?

As cash buyers it would not make any sense for us to pull out of the purchase and then continue paying rent at market rates when we can afford to purchase the house outright, but I guess the seller may not trust or believe in that point.

This seems like common sense in our situation, but knowing the UK it will prove to be impossible and we have to give the money to storage and another rental while the seller is paying bills on an empty house.

YBR

If I were the seller, I would refuse because of all the obligations on Landlords which are not worth it just to cover the gap of a few months.

FlorayG

The problem here is that the landlord can't evict you after 6 months - they can only advise you of intention to proceed with eviction notice, which can take a FURTHER six months or more. If you decide to withdraw from the sale, they then have tenants who have nowhere else to go and now they can no longer market the house with vacant possession, considerably reducing its market value. Additionally the house owner has to instigate gas and electrical safety checks and set up a self-employed tax return with HMRC for the rent income. The house also has to have an EPC of D or better ( Does it?) All in all, a lot of trouble that may end up costing them more than leaving it empty

Pat38493

FlorayG said:

The problem here is that the landlord can't evict you after 6 months - they can only advise you of intention to proceed with eviction notice, which can take a FURTHER six months or more. If you decide to withdraw from the sale, they then have tenants who have nowhere else to go and now they can no longer market the house with vacant possession, considerably reducing its market value. Additionally the house owner has to instigate gas and electrical safety checks and set up a self-employed tax return with HMRC for the rent income. The house also has to have an EPC of D or better ( Does it?) All in all, a lot of trouble that may end up costing them more than leaving it empty

And we are not allowed to waive our rights in that respect i.e. waive our right to not be evicted for 6 months? 

We are already in a position where we need to move out in less than a month from now and we are fine with that, so it's no different.

prettyandfluffy

You can only ask.  If I were the seller, I would not do it; however a family member sold their house and stayed on renting it for about 8 weeks until they completed on their purchase - a lot of trust involved.

FlorayG

Pat38493 said:

FlorayG said:

The problem here is that the landlord can't evict you after 6 months - they can only advise you of intention to proceed with eviction notice, which can take a FURTHER six months or more. If you decide to withdraw from the sale, they then have tenants who have nowhere else to go and now they can no longer market the house with vacant possession, considerably reducing its market value. Additionally the house owner has to instigate gas and electrical safety checks and set up a self-employed tax return with HMRC for the rent income. The house also has to have an EPC of D or better ( Does it?) All in all, a lot of trouble that may end up costing them more than leaving it empty

And we are not allowed to waive our rights in that respect i.e. waive our right to not be evicted for 6 months? 

Absolutely no. That's a ploy bad landlords used to use, so it was made illegal. You can't sign away your tenant's rights.
There might be a way around it if the vendors were to make it an AirBnB/holiday let and let it to you on a monthly renewing basis, but I'm not sure of the legal requirements of that. You could look into it

FlorayG

Pat38493 said:

FlorayG said:

The problem here is that the landlord can't evict you after 6 months - they can only advise you of intention to proceed with eviction notice, which can take a FURTHER six months or more. If you decide to withdraw from the sale, they then have tenants who have nowhere else to go and now they can no longer market the house with vacant possession, considerably reducing its market value. Additionally the house owner has to instigate gas and electrical safety checks and set up a self-employed tax return with HMRC for the rent income. The house also has to have an EPC of D or better ( Does it?) All in all, a lot of trouble that may end up costing them more than leaving it empty

We are already in a position where we need to move out in less than a month from now and we are fine with that, so it's no different.

It is different. You have sold your house so you have to move out. If you were renting and your LL had given you notice, you could stay until your purchase was completed

user1977

FlorayG said:

Pat38493 said:

FlorayG said:

The problem here is that the landlord can't evict you after 6 months - they can only advise you of intention to proceed with eviction notice, which can take a FURTHER six months or more. If you decide to withdraw from the sale, they then have tenants who have nowhere else to go and now they can no longer market the house with vacant possession, considerably reducing its market value. Additionally the house owner has to instigate gas and electrical safety checks and set up a self-employed tax return with HMRC for the rent income. The house also has to have an EPC of D or better ( Does it?) All in all, a lot of trouble that may end up costing them more than leaving it empty

And we are not allowed to waive our rights in that respect i.e. waive our right to not be evicted for 6 months? 

There might be a way around it if the vendors were to make it an AirBnB/holiday let and let it to you on a monthly renewing basis, but I'm not sure of the legal requirements of that.

Possibly even more of a legal headache if it's somewhere where holiday lets require licensing/planning.

And the problem might not quite be refusing to leave, but staying put and finding excuses to chip away at the agreed price (assuming you haven't somehow concluded a contract for the purchase).

gwynlas

There might be sellers who would agree to this but probably only those who are selling to a neighbours child for example where a relationship already exists.

Letting to a stranger would be a no no 

Pat38493

gwynlas said:

There might be sellers who would agree to this but probably only those who are selling to a neighbours child for example where a relationship already exists.

Letting to a stranger would be a no no 

What about if we had already exchanged contracts - I guess that would remove the concern about pulling out of the purchase, but it would still be a headache to become a landlord temporarily for only 3-6 months - I have no idea how much hassle and cost is involved there.

FlorayG

Pat38493 said:

gwynlas said:

There might be sellers who would agree to this but probably only those who are selling to a neighbours child for example where a relationship already exists.

Letting to a stranger would be a no no 

What about if we had already exchanged contracts - 

If you've already exchanged then it's usually at most 2 - 3 weeks before completion and moving in