Should I let my property out until May 2022 when I can sell on open market?

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    Should I let my property out until May 2022 when I can sell on open market?


    Hi


    I have never let out a property before, but I am thinking of doing so now, as I cannot sell my maisonette on the open market until May 2022, and, as we have done some improvements, I want to reap the full market value and not be fobbed off with a low price from the housing assoc.

    Here is the full story:


    In 1996 I moved into a lovely council maisonette. Some time later the local council housing ceased being council and came under a district housing association. In 2012, due to a change in circumstances I bought the maisonette, completing in May 2012. Since then, the block has become somewhat untidier. I would say that the block tends to be a mix of long standing council tenants who like to keep the place in good order, and younger tenants who seem more messy and perhaps a bit less community minded. Back when I moved in, everybody had their own dustbin, and the place was clean and tidy, but now there is a communal bin and recycling area which is a total mess, and my maisonette is right next to it! It is a one off council block (actually two small blocks) in a reasonable residential area, and not on an estate. It is on a main road near town and close to the hospital. The row that my maisonette is on are all good, long standing tenants with a sense of community. The bedsits are down below and people seem to come and go.



    Anyway, my Mum has recently moved into a flat in a sheltered housing block, so my partner and I have moved into Mum's house, which has been in our family for decades. I am now looking to sell the maisonette, but will not have owned it for ten years until May 2022 (ten months time). The maisonette has a new kitchen and bathroom, which we put in originally for ourselves, before we realised we were moving. To prepare the property for market we put in a new boiler, and had it redecorated. We made the mistake of assuming that because we have owned it for more than five years, we can sell on the open market - wrong! ( I really must learn to read). I found out yesterday that five years ownership means that I do not have to pay back any of the discount I was allowed in buying it, however, under ten years I have to offer the district housing association "First Refusal". They seem to have only just realised this themselves, hence the phone call I received yesterday. I had already made an appointment for their surveyor to come and take a look on Friday, and for their designated estate agent to come and do an independent evaluation in early August. The housing assoc said to me some time ago, when I was mooting selling, that if they bought it back they might have to take out our nice kitchen and bathroom to "restore it to standard", so I feel that if I do sell it to them I will not get the full value of the property.


    Because I am just under the ten years they have now asked me to draft out a letter offering the property back to them for sale. I am very loath to do this as, if I understand correctly, it then leaves me open to having to take the price that they offer. The rules say they have to offer me "market price", but I know from experience that ideas of what "market price" is are inclined to differ, with people tending to pick a "market price" that fits their own interests.



    So the question is this: do I rent it out for a year and then sell? Problem is, if bad tenants make a mess of the place, all the good work that myself and my partner have done will have to be redone, do I might actually be no better off. We don't fancy the idea of just leaving it empty for ten months. Should I just go along with the under-ten-years procedure and risk a low offer, but get it off my hands? Can I refuse any offer the housing assoc make if it is not what I consider to be the worth of the property? Should I speak to my solicitor?



    A few years ago when we were thinking about selling we got a local estate agent in to have a look, and he seemed to suggest that, because of the condition of the block, it would not be easy to get "professional" tenants in. There is a general hospital nearby where I think there are people working who want temp accommodation.


    Thanks for reading and I am glad of any opinions.

    #2
    Unless you've always wanted to be a landlord and, previously, had no way of putting that ambition into practice, about the single worst reason to become a landlord is that you have a spare property.

    Who'd want to rent a nice property for less than 10 months and then have to move again?
    Probably not the kind of tenant you'd want to have.

    Removing a tenant who doesn't want to move out is expensive, time consuming and stressful.
    Most non-landlords don't know this.

    Of all the types of property never to let out is somewhere where you used to live that you are quite proud of.

    Tl/dr "no".
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      Depending on the location of the property, I would suggest holiday let for short term, otherwise there is no point renting it out as the difficulty will be arranging viewings if the T doesn't allow it, or wont leave when you need them to leave. Also unless you are selling the property as an investment rather than a residential property, it depends on who you are trying to attract.

      Comment


        #4
        You could always look at the lower price you might receive as giving back and making the property available to a needy family - I imagine you received a hefty discount and have made a tidy profit on your house.

        I agree with jpkeates, landlording is not something you should just fall I not, you are likely to get your fingers burned, badly.

        Comment


          #5
          jpkeates,

          Thanks!

          Yes, sorry for the overly long post.

          I definitely have not really ever had an ambition to be a landlord, as I know of the problems that it entails.

          Though actually it may be people connected with the hospital that might be interested in a short let, as junior hospital doctors tend to do six month stints.

          Comment


            #6
            jpucng62,

            Yes, there is an ethical case for selling back to the housing association.

            I may have benefitted from a good discount, but we did put something back into the property by putting in new kitchen, bathroom and boiler, as well as recent decor and woodwork. It's the thought that our good work may have to come out to restore it to "standard" that bothers me.

            Comment


              #7
              Originally posted by JasperChadwick View Post
              It's the thought that our good work may have to come out to restore it to "standard" that bothers me.
              But if you are selling then you have no control of what any new buyer does anyway.
              You could sell to a private individual who would still change what you have done.

              Other than that it seems to be a case of haggling over the price.
              Again a private buyer may or may not make a better offer or even a lower offer than the HA will.

              One advantage you have with selling back to the HA is that you don't have to go looking for a buyer with all the hassle/costs of arranging viewings, advertising fees, estate agents fees, etc. etc.

              Comment


                #8
                Screenshot 2021-07-20 at 17.33.08.png

                Don't know why you think you on't get market value - looks a pretty safe bet by the regs.

                Comment


                  #9
                  Thanks for all your comments. The HA surveyor came the other day and had a good look round. Independent Estate Agent due at the start of August. Let's see what they offer me.

                  Comment


                    #10
                    Why don’t you rent your mum’s house and stay in your maisonette - it is only for 10 months and then you can sell. Do up your mum’s house and move there after the sale of the maisonette

                    What I have learnt in my journey : never let a house which you considered your home. I had to learn this the hard way, when I had to evict the tenants from my family home which I let out. Now the memories of that house is only filled with the tenants behaviour and we have decided to sell for good, never want to be landlords again.

                    Comment


                      #11
                      Originally posted by OS7 View Post
                      Why don’t you rent your mum’s house and stay in your maisonette
                      Probably the same reason. They care about that one as well ('been in the family for decades').

                      It's a shame to leave property empty and we are all penalised for doing it via council tax, but I would agree with the sentiments expressed by others. There are very real risks involved in letting either property and you cannot be sure of letting anything for a 10 month period on an AST. Probably best not.
                      There is a fine line between irony and stupidity. If I say something absurd please assume that I am being facetious.

                      Comment


                        #12
                        Are there no restriction on letting in your lease , original purchase agreement or mortgage?
                        I would be very surprised if there's not

                        Comment


                          #13
                          OS7,

                          Thanks for your comments. But it is the maisonette that is more the rental property than Mum's house (where we now live) which has been in my family since the seventies, and I have lived here myself, previously, as well as now. Mum's house is a lot bigger, and has lots of our family furniture here. The maisonette only has a few bits of furniture in it that we want to keep.

                          Comment


                            #14
                            Section20z,

                            I would be free to let the maisonette out, as far as I know. I own the maisonette outright.

                            Comment


                              #15
                              Ah I see! Then by all means rent out the maisonette. Probably what I would do is to keep it empty, and sell after 10 months - only because I don’t want the hassle of renting it out.

                              Comment

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