Simply don't know what to do.

[Cantgiveitaway]

4 years ago we inherited a house. It has been on the market for the entirety of that time. It is on sale for approx 25% of market value. Reasons below:

The property is non-standard construction and therefore unmortgagable (we have explored this extensively).

It has a sitting lifetime tenancy on a peppercorn rent. Tenant is in their 70s and in good health.

We cannot sell it due to the above.

For those unaware, lifetime tenants cannot be evicted and the rent is very tightly controlled. We have increased it to the maximum allowed every year for the 4 years we've owned it. It still doesn't constitute £1000 a year.

We do not have any more money to put in to the property. We've done the legal required stuff. We've explored legal avenues for eviction ABD offered to give (gift) the property to the sitting tenant.

We basically need someone to come along with enough money to keep the property legally for 20+ years before they can do anything with it.

The most recent gas and electricity safety checks and the EPC have shown significant work needed in the next 12 months to keep it legal. We can't do it. Our only option is to sell our home that we, move in to a much smaller property in a different area (moving children's schools and away from family) and renting ourselves.

We have 0 savings because of the house and cannot afford basic things for our own home.

I just don't know what to do.

WWYD? We literally cannot give it away - we offered it to the LA and to a social landlord and a landlord with an extensive portfolio in the area and all said no.

In 20years, when the tenant dies or moves in to care the land might be worth something (and therefore sellable) but we can't wait that long. We had absolutely no idea the property existed until we inherited it and I've no idea why we did.

Any out of the box thinking here from the hive mind?

That's not an eviction. But surely you aren't suggesting I commit arson?

Not at all. It's just the phrase "any circumstances" was used. Which implies were any of those things to pass, you would be liable for rehousing the tenant ? With all that suggests ?

This is an AIBU type pondering, not legal one 😀

This thread has taken on a life of its own.

Thanks to everyone who has taken time to respond and to those who have PMd me. Working my way through now.

To answer some questions.

Yes, we have had specialist legal advice. That's what's allowed us to increase the rent so far.

The tenancy does not get renewed. It stand as is, and cannot be changed.

Yes, it can be inherited, but only under specific circumstance, something like a relative has to live with them for at least 2 years. From I can tell, they don't have any relatives. They are a loner type. They were born in the property/moved in as an infant.

No idea how the tenancy came to being or how/ why great uncle bought the house.

Those suggesting I rent out the garden/ parking space. The property isn't next to a road. There's a road then a bit of green space and then a group of little bungalows (that also used to be pre-fabs). There's no parking space and even if there was, the tenant is the tenant of the whole property including the garden. We cannot rent out a bit of it. It's not a desirable building plot, which is why it hasn't sold.

For the removal of doubt (though it is in the OP) we have offered it, free of charge, to the tenant and they have refused. They do no want the hassle of ownership. They are happy to remain as a tenant.

I don't know if they can agree to a rent increase beyond the legally allowed amounts. I don't think they'll be adverse to this, though from the legal advice we've had, I don't think this would be lawful. I will ask I do know we can't simply increase the rent.

Neither I nor DH thinks the tenant is unreasonable. They are simply living in their home as they are entitled to do. Our financial problems aren't really their concern.

Yes, we have tried some specialist property buying companies. Maybe I need to offer it for free to them?

We've been down the sales route with a few buyers over the years and once they've looked at the legal obligations, they have withdrawn, even when offered significant reductions.

I've contacted several large auction houses today.

So we're legally required to maintain the property in a habitable state. Should any of those things happen, the tenant would likely be offered temp housing by the LA and we would have a timeframe in which to make good - hopefully the insurance would pay out, but the property being the type of construction it it, means the insurance is costly to ensure a property not really worth anything and I don't think they pay out the cost of building a new one. So I think, we'd likely have to go bankrupt. Which is a very alarming thought.

Technically yes I suppose that would end a tenancy - but you run the risk of being sued by the tenant and of course if the house burns down you would expect the property to be insured and rebuilt/repaired and the tenant may have the right to occupy the rebuilt property under the same tenancy agreement.

Can noone look at the contract because it isnt your contract?

Have you applied for a fair rent review (if a fair rent is registered? Even easier if not!)? If you can show you've increased the value of the rent (Not the property, so less than a tenner a month) by 15%, which I'd have thought the new roof and windows should do, you can apply to the VOA to have the 5% + RPI cap on raising the rent to be removed

Appreciate that you as LL are responsible for the repairs/maintenance, but have you checked out if any assistance is due because of such low rent and if the Tennant is elderly, vulnerable, in receipt of benefits/assistance?

On pg 8 I posted some funding which you may, or may not, have already checked out.

Could you offer it to the tenant so they can buy it at a low price and then they would need to pay for the repairs. Or tell the tenant you cannot afford the repairs with the current rent so advise them you will need to put rent up so much they might prefer living somewhere else.

If you have the deeds, and need to do expensive repairs, could you draw down money on the value of the property, since the tenant is quite elderly and it could well be vacant in the next few years? Or take out a mortgage on the property?
If you are in the position of running it as a business, whether you want to do this or not, since you must declare the rent for tax purposes, you could surely also declare your maintenance costs?
(You sound the most decent landlords I've heard of.)

@Cantgiveitaway what an awful situation to be in. However I have followed your thread and What is not clear to me is upon receiving that special legal advice about the limitation on rental increase, why did you Simply carried on implementing that advice is supposed to pursuing the alternative advice of rejecting the inheritance. I understand you are now speaking about things four years down the line, but I am interested to understand what occurred in the first year. What I’m trying to get my head around is as soon as the enormous financial responsibility became clearer to you owing to this inheritance, you seem to be more focussed on sorting out your finances, maybe going into a rental, so that you can keep up all the legal applications, and have not or doesn’t seem to have focussed on rejecting all those financial responsibilities as soon as you became aware of it, i.e. by rejecting the inheritance . Yes from what you have said it looks like the only time you’re going to be having no financial obligation is if you go bankrupt. Are you now planning to bankrupt yourself?

OP has said many many times that the tenant doesn't want it even as a gift. It's always good to press the 'see all' for OP posts so you don't repeat redundant advice that has already been given by a crowd of people who also didn't read the thread.

Gotta wonder why the great uncle did this dirty on you

Yes we have. The fair rent wasn't registered and has now been. It was set at £46 a year when we registered it on inheriting the property based on the 6p annual rent of the original contract. We can apply next time for the limit to be removed, but that's 18months away or so. (Exactly figures and dates might be a bit out, I don't have all the paperwork to hand but it's not out by much).

This appears to be less about the house then, and much more about your obligations to house the tenant.

What if - as owner - you were to suddenly become unalive, and the property were to be considered intestate ? I have a sneaking suspicion that HMRC would not just accept they have to house the tenant ?

Maybe he wanted the vulnerable tenant to be safely housed for life?

But given this comes with significant financial liabilities and a limited asset at the end of it he should have also left money for the op to fulfil her landlord obligations.

If the tenant is reasonable is there anything that might motivate him to help? By may be paying for some of the essential repairs? He must have saved a shed ton of money paying so little all these years. He might be willing to help to keep you as nice landlords rather than an unknown quantity who might not be so nice?

Then he should have left the house to the vulnerable tenant instead of to a nephew

Possibly, ‘gift’ the property to a Letting agency?
(appologies if this has already been suggested)

Would have been better definitely but he might have thought the tenant has SEN and needed looking after? Don’t know but I feel very sorry for the op.

23 posts you have made & all you have done is criticise the other suggestions (fairly as most of them were utterly crap & illegal or immoral or both)

But you have not made one suggestion as to what she could actually do.

Whoever prepared the will/trust deed has put you in a very difficult situation and I'd be taking independent legal advice on the wording there

Your right to refuse the bequest should have been explained too

Absolutely this or very low reserve. It isnot at 25% market value or it would have sold. Any property ultimately is only worth whar someone willpay for it.

The auction will probably not mention the non standard construction.

Could you offer it for free to a large housing developer? They might be interested if the land it sits on will be worth something eventually.