Buying then renting to owner short term

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Buying then renting to owner short term

    Buying a flat for £180k. Owner moving abroad and is having property built over there. He does not want to move out till mid November. This is OK with me.
    All paperwork going through solicitors but we have not reached exchange just yet. He has now advised that he needs to raise monies to finance the next part of his new build abroad. He has suggested that I could buy his flat sooner than November and he rents off me in the short term. He said he'd pay £200 per week and pointed out that this would be a better return than bank on £180,000.
    On the face of it I could do this as I am buying without mortgage and have elsewhere to live in the short term.
    Please can anyone give advice? What are the pitfalls (if any).
    He seems a reasonable bloke and if we could work something out to our mutual benefit all well and good but if it was a hassle for me I wont do it.
    I assume we would go through the agents who are selling the property for him and so they would take a percentage. Would I also have to pay for vetting and start up agreements etc? These charges may be out of proportion to the 6 weeks or so he may be renting.

    Would be very grateful for any advice. Thanks.

    #2
    SARB regulation

    You cannot proceed with selling and renting back unless you have FSA regulation approval, otherwise, you will be breaking the law.
    see Sell and Rent Back Regulation

    Comment


      #3
      Thanks

      Gosh, thought this would be a simple thing to sort out!

      Havent been into all the info yet but looks quite overwhelming. Many thanks for such a prompt reply - bit of bedtime reading!

      Cheers

      Stoker 48

      Comment


        #4
        Originally posted by havensRus View Post
        You cannot proceed with selling and renting back unless you have FSA regulation approval, otherwise, you will be breaking the law.
        see Sell and Rent Back Regulation
        Didn't another LZ thread on this topic establish that someone so doing not by way of business but as a 'one-off' need not comply?
        JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
        1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
        2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
        3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
        4. *- Contact info: click on my name (blue-highlight link).

        Comment


          #5
          Originally posted by jeffrey View Post
          Didn't another LZ thread on this topic establish that someone so doing not by way of business but as a 'one-off' need not comply?
          Yes, http://www.landlordzone.co.uk/forums...d.php?p=236769, in particular post #7.

          Comment

          Latest Activity

          Collapse

          • Reply to Joint tenancy agreement, 1 tenant has already moved out
            by Yorkie2020
            Guess I've been very lucky this time. My niece has informed her partner that she is ending the tenancy and signing up for a new one in her name only and he is ok with it. She did point out that he will no longer be responsible for any more rent or bills when it's totally in her name.
            JPkeats,...
            27-10-2021, 02:02 AM
          • Joint tenancy agreement, 1 tenant has already moved out
            by Yorkie2020
            Good evening all,

            I wonder if I could get some advice on ending an AST tenancy in England.

            Originally a 6 month AST last Sept between my niece and her partner, I foolishly listed both on the AST as joint tenants and didn't list him as a permitted, there was no deposit paid....
            20-10-2021, 19:44 PM
          • Reply to Increasing rent
            by jpkeates
            There may be something on the NRLA website, but I don't know of a standard template.

            To be honest that clause doesn't seem to help you a lot, it stops you using a s13 notice (I'd wrongly assumed that because it said "may" you'd be able to) but doesn't actually help you with an...
            26-10-2021, 17:37 PM
          • Increasing rent
            by Berlingogirl
            Tenancy start date May 2020 in England. 6 month initial AST.
            My tenancy agreement says
            “The landlord may increase the rent after the first 52 weeks of the tenancy…..”
            Is there a specific form I should use?...
            26-10-2021, 13:33 PM
          • Reply to Increasing rent
            by Berlingogirl
            Thanks jpkeates, I looked at the form 13 but that’s for if you don’t have anything in your tenancy agreement with regard to a rent increase. Is there a pro forma for a rent increase if there is a condition in your TA?
            26-10-2021, 17:05 PM
          • Reply to Increasing rent
            by jpkeates
            If the tenancy is now an SPT, and you want to be ever so formal (and impose the increase without any agreement), search for form 13 (which is called something else on the government's tenancy forms page).

            Otherwise, you just need to get the tenant to agree and start paying the new rent...
            26-10-2021, 13:58 PM
          • Reply to Advanced rent and S21 Notices
            by jpkeates
            It is quite likely that the 2 additional months might be seen as a deposit, unless the tenancy agreement is very specific about the initial payment being for months 1, 5 and 6.

            If it is a deposit, you won't be able to use a s21 notice without returning it and the deposit will be unlawful...
            26-10-2021, 08:35 AM
          • Advanced rent and S21 Notices
            by Shorif908
            Hi All,

            I have recently had new tenants move in.
            the estate agent did the whole thing and put them in.

            The arrangement with rent payments was this. 6 months AST Tennants pay last 3 months rent in advance and then make 3 monthly payments in advance. Ie start of the month....
            26-10-2021, 08:06 AM
          • Reply to Advanced rent and S21 Notices
            by Lesney Park
            BUT to answer your question, yes the 3 months very much look like an unlawful deposit, being for a non-defined period (the last 3 months of a tenancy). If it is for a specific 3 months, its a bit lesss grey but then I'm wondering what you hope to achieve...
            26-10-2021, 08:35 AM
          • Reply to Advanced rent and S21 Notices
            by Lesney Park
            Never been shown previously

            Are you still using the same letting agents, did they come up with this "payment plan"?...
            26-10-2021, 08:33 AM
          Working...
          X