Our seller has decided to 'slow things down'. What do we do?

[BlackCoffeeExtraStrong]

Hi,

So firstly, I get that so many people are being affected by what's going on right now and a lot of house sales are falling through as a result. I get that and I was/am certainly looking at the bigger picture and so initially, tbh, we were expecting someone to pull out, given we are in a chain of 5. We had kind if made our peace with that.

However, when the lockdown was first announced, everyone in our chain made it clear that they wanted to proceed and move as soon as was physically possible, under the circumstances.

This has been the case until the last few days, when our sellers EA has said that they now want to sit tight and see how things go. They are buying a long term house, neither have lost their jobs etc, but of course nobody knows what's going on behind closed doors and so if they want to pull out, as gutted as we would be, we would understand.

As it stands, they sound like they just expect everyone else in the chain to just dangle for a few months, to see what the economy is doing, but everyone else is very keen to exchange. One in particular, who is getting very impatient.

The bottom of the chain is our buyer (BTL investors) and we sold to them at the beginning of December. They aren't being pushy, which is good, but do still want to go ahead. I don't know if that will be the case if our sellers pull out and we then have to look at other properties.....which we can't actually physically do for the foreseeable.

How much pressure should we apply, if any? I told their EA that we just need them to be completely honest with us. If they know that they now have no intention of moving until all this has settled, then they need to tell us, so we can hopefully keep our buyer and move on. Things won't be settled for, well.....how long is a piece of string?! So we can't hang on indefinitely.

I am already enquiring about other properties, but obviously we can't view them yet.

I suppose we should just be honest with our buyers?...Ask how long they'd be prepared to wait if we needed to look for something else?

WWYD? Really appreciate some advice.

Set a deadline that you're comfortable with and communicate that to the seller. It sounds as though you're realistic about whether it falls apart and are already seeking alternate options. Bit weird for a seller to want to stick about, perhaps they expect to get a better deal on the place they're buying?

How much do you want that particular house, as opposed to wanting to sell your place?

You have the option of still selling to the BTL investor and moving into rental. Not ideal, obviously, but you're in a better position to apply pressure perhaps than further up the chain above the sellers?

Thanks for the replies so far.

@Loofah01, yes, I think setting a deadline would be a fair suggestion. I suppose we are nervous about others in the chain not being agreeable to that though. As I say, there is a vendor further up the chain that wants to exchange now and is getting restless.

As a pp mentioned, you would be wise to continue with your own sale and go into temporary rental if need be.

The property market is due an inevitable crash along with the economy as a whole. Selling at the price you agreed in December is the best financial decision. You will be best placed to take advantage of lower house prices in 6-12 months then.

Just saw your buyer is a BTL investor. Could you agree to stay put and rent from them after the sale?

You have the option of still selling to the BTL investor and moving into rental

Or, asking if your BTL buyer would still buy, then rent straight back to you. You’d need to do all completely above board (ie with agreements in place, deposit in scheme, full inventories taken etc)

@NoSquirrels, this is not our 'dream house'. That said, I did get a good feeling about it and it did feel like home, but I would say we probably made more compromises than we would have liked, because we were desperate to move and so, desperate to keep our buyer.

We would consider renting, but we have two dogs and a cat and very few landlords will accept this. That aside, the way things are, we could end up being stuck in rental, throwing money away, due to nothing coming onto the market.

Crossed with @BestestBrownies

The obvious solution is that you continue with your sale and then stay in the property and rent it from your buyers.

I actually thought this would be a good solution, but just mentioned it to DP and they think it's a bad idea. The only issue I can think of is that our house is not rental ready and so our buyers would want to renovate before renting it out. As it stands, the rental income would be worth about a third less than it's potential. I.e, after renovation. Next door is identical and rented and I know how much they charged pcm before and after renovation. I can't see our buyers being happy to wait to renovate and get the maximum rental income.

Um, they can charge you what they like as rent. If you agree the price as being the higher and pretend it's been renovated, then when you leave they can actually do the work and rent it to whoever. Basically, you continue to live there but pay more for the privilege and hope that the upward chain doesn't fall apart.

I would def put that option to your buyers.

They might be delighted to have immediate cash flow.

If you can get shot of your property on Dec price you would be mad not to take it - even if you had to live in a tent!!

And yes there are LL who take pets - they just charge an additional cleaning fee. Also in this climate I think LL will have to be more flexible.

I would imagine that there are also Air B n Bs and short term holiday lets who would bite your arm off as they most likely will have lost a lot of their season.

How far away from exchange are you with your buyer....?

@Gutterton, we don't have an exchange date yet, but we would have done by now, had this not happened. It would be asap as far as everyone else is concerned

@Loofah01, well yes, they can, but forgetting whether or not we would be willing to over pay in rent, I doubt they'd want such a delay in being able to get in and renovate.

Are you prepared and able to pay the higher post renovation rent on your property in its current state if needs be? If yes and your BTL investor is agreeable, it puts you in a strong position:

1. you can set a deadline with your vendor with no issues if it doesn't come about - you just know where you stand and aren't left hanging around.
2. if it doesn't work out, you will be cash buyers when you can get out and look again

If you're buyer is still keen to proceed, it could work for them too, as they might struggle to find tenants in the current situation.

I think the person upthread can probably apply more pressure, but if the vendor is clear you too are not willing to hang around, and not reliant on them, it might spur them into action.

@MaggieFS, I would like to seriously consider it, but DP is dead against it and says it's too risky but I see losing our buyers as a massive risk, given it's taken us almost 2 years to get to this stage.

You’re all at once overthinking and complicating it.

1. Do you need that sale - Y/N?
   (Sounds like yes if it’s taken 2 years to get here)

2. Will you go into rented to do it?

‘Losing’ money on rent is a red herring - you ‘lose’ money in mortgage interest every month anyway, and you’d be gaining liquidity & putting yourself in a really excellent position to be chain-free buyers for any onward purchase.

Overthinking what you assume your BTL buyers might want/need also is a red herring.

What’s the risk your DP sees? Not sure I understand what he feels is risky.

I can see the logic of renting off your BTL purchasers but is it that simple?
They will want this to be a proper business decision which means getting a legal rental agreement which means getting EPC, gas safety certificates etc. I don't think that they can commission such things now. So the risk will be on their side - getting a tenant that they cannot shift because they haven't got a watertight tenancy agreement.

If it were me I'd move into rental. Presumably you want to get rid of the house you currently own which is why you went down the road to start with. At least with rental you are free to choose a house and area you like. Even if you end up stuck in rental for a while at least you will be out of where you are now. But it all depends on why you are trying to move

I think it's the best option too and tbh, since we've found out that our sellers are wobbling, it's forced us to reevaluate and really ask ourselves, how much do we want that house? We obviously liked it enough to put in an offer and it's certainly a big step up from where we are now, but this has given us a jolt and we are now seeing the compromises we made more clearly.

Saying that, if the EA called tomorrow and said that they'd discussed it over the weekend and have decided to go ahead, then we'd be happy.

I just wish DP would come round to the idea of possibly renting 🙄

You need to do the maths for your DH and lay out a realistic scenario if this all falls through. Pull some predictions from quality sources (FT?) and do the maths on a 10% drop, a 20% drop etc.

Also draw his attention to the fact that LTV and mortgage offers will be restricted - so if you can sell at the top price and buy at a lower price in 6 months your LTV will be much improved.

If it has taken you 2 years to sell and you have got a great price - you need to lay out living where you are for another 2-3 years whilst the price of your property drops.

@Gutterton, thanks.

I think I might have made a breakthrough with DP! Not to stay here, but rent somewhere else, assuming we can find a landlord willing to take on dogs. My biggest concern would be that nothing comes to market due to coronavirus and people not wanting to move and we get stuck for a lot longer than planned. 6 months is ok. Several years is not.

Also, what do you say to the landlord/EA? Do you just keep quiet about it being a stopgap?

You don’t have to give a reason to the EA / LL for renting. You can say that you are sitting out the property market if you want? Most will ask you to sign up for 12 months but there should be a break clause after 6 months when you can then give your notice.