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Tenants in our house but think we're going to have to sell..

(7 Posts)
LittleMissSnowShine Fri 02-Nov-12 11:46:34

Hi all - sorry for lengthy post but your advice / experiences would be v much appreciated!

Me and DH own a lovely but tiny little 2 bed 1930s terrace near centre of town. With me, DH and DS it was already getting to be a bit of a squeeze because of lack of storage space, no proper garden etc. Because we only bought it in 2008 we are, unsurprisingly in negative equity to the tune of £15-£20k. So we decided in July to rent it out and we would rent somewhere ourselves.

Between mortgage, rates and landlord insurance our basic running costs for the house are £815 a month and our tenants pay £615 a month, so there was already a £200 discrepancy. We had budgeted for a further £100-£150 a month on average for any maintenance work / running costs to the property and though we certainly weren't going to be making a profit on the house or even breaking even, at that amount a month we could cover it and we thought it would be better in the long run.

However in the last 3 months we have had to spend closer to £900 just on maintenance / repair costs, getting things fixed, tackling a problem with damp, getting pest control out, having chimney cleaned, getting chimney capped etc etc. We swallowed it month after month as 'teething problems' but the tenants have told us the damp problem doesn't seem to have been solved and we are just ??????

We are finding the costs month to month of running two houses just way too high, since I only work part time but we have to run two cars for our jobs and pay childcare costs for DS when I'm in work. I will (hopefully) be off on maternity leave next year and my pay will just be stat maternity pay while I'm off. We have no savings left.

We're starting to think we are just going to have to swallow the £15k-£20k loss and sell the house now before things get any worse. I can't sleep at night worrying about how we are going to make it through to pay day. I was in tears last week because my car needed a new battery and then the tenants phoned to discuss the recurrence of the damp issue. I'm at the end of my tether - what do people on here think? Is selling our best option at this point? Even though the tenants (who have only been in situ) for 4 months will have their noses put out of joint by us putting the house on the market (they have said repeatedly they would like to stay in the house for 18 months or so) what else can we do?

Your suggestions muchly appreciated!!

Rockchick1984 Fri 02-Nov-12 13:02:25

Honestly? I think selling sounds like the best option for you. How long is their tenancy agreement for? They have the right to stay in the property until the end of that, but you can put it on the market before then. If there is a deficit on the mortgage, the lender will convert it to an unsecured loan.

noisytoys Fri 02-Nov-12 13:16:49

I would be questioning them as to why there is so much 'damp' if you have previously lived in the house and it was never an issue. Are they expecting you to fully refurbish the house in an attempt to cure the damp??

Mum2Fergus Fri 02-Nov-12 17:37:16

Id agree selling is best option. Assuming tenants on 6 month assured tenancy? Winter isnt best time to be selling in my experience so theyll get their 6 months then move them onto 1 months notice. Sure theyll be disappointed but need to accept circumstances change. Would they be interested to buy, offer first refusal. Could you sell with sitting tenants to prospective buy to let landlord?

expatinscotland Fri 02-Nov-12 17:40:05

Hmm, if you can wait till Spring it might be better to sell then.

LittleMissSnowShine Mon 05-Nov-12 08:56:09

Thank you for all your feedback! Saw estate agent on Fri and he thinks we'll prob sell at a £15k loss but if we time it right it might be more like a £10k loss and we might be able to add that onto another mortgage cos a few lenders have options available now for ppl in our situation. Spoke to tenants on Fri too and they are disappointed but they are happy enough as long as,we leave putting it on the market til after xmas so that's what we'll do I think. Feeling a bit less stressed now than last week, just hope it sells in the spring! Thanks again ladies [flowers]

FruitSaladIsNotPudding Mon 05-Nov-12 09:08:50

Give the tenants plenty of warning so they can find a new home without too much bother.

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