AIBU to let buyer move in before exchange?

[Potatomashed]

Okay, I know this is a bit of a legally dodgy one but I can’t approach my solicitor or things will get all official…

We have privately sold our property to a friend so no estate agent involved. We expected to complete in mid July (14 weeks from offer, chain free) but there has been some hold ups with solicitors being away for weeks at a time. This is just legal stuff about the wording of a document and we anticipate completion in about a fortnight.

We have relocated already to a rental in our new city. The house we are selling is empty. The buyers are renting their old house out and the tenants are due to move in next week.

Is there a way we can allow the buyers to move in to our house before exchange/completion? Was wondering about renting it to them but our mortgage technically doesn’t allow that without approval. Not sure about a short term holiday rental situation though. Would airbnb give some kind of insurance protection?

That is really really risky. It could all go south in a big way. The only route I would take with this is an iron clad legal document and even then would not advise it. Are you just trying to be nice to the buyers, or is there some other reason? You shouldnt let emotions get into a business transaction (trying to be nice and getting the appropriate sum of money for selling a high value investment)

I have heard of people renting the property prior to completion, however this may be against the terms of your mortgage (if you have one) and insurance. I would also consult with solicitors before you a agree to anything like this.

Hopefully someone more knowledgeable will come along soon,

I wouldn’t do this. Sitting tenants are a thing of the past but it would take a long time to evict them if they didn’t buy it and didn’t pay you any rent.

Very iffy and it would be a no from me; assuming you trust them implicitly and they don't mess you around, your insurance would be invalidated putting you at massive risk should something awful happen

Our buyers wanted to do this a few years ago and our solicitor said it should be an absolute no. The risk is that they don’t complete and then you have tenants in the house whom it’s v hard to get out, who might damage it etc. Plus may well invalidate your insurance and breach your mortgage conditions.

We did this (Australia) as the buyer was staying in an expensive holiday apartment while house hunting. They were leaving a major city during covid. During the 3 weeks they rented they found so many little things they wanted us to fix prior to settlement. It was annoying.

Thanks everyone. Seems like a clear no to renting it to them.
I spoke to the mortgage company and they wouldn’t give permission to airbnb/holiday let the property (so no AST etc).
I guess the only option is to decide if we would like them to stay as our guests, in the full knowledge that we would be taking all the risk…

If they would be happy to rent the house from you, why don't they just go and rent a house from someone else as yours is not available to them?

No, there are plenty of airbnbs, short holiday lets or even hotels and I have used one of these options myself with two young children when we had a gap between completions on properties.

You move out, all the stuff loaded into the removal van into containers and they store it at cost. Your buyers should never have allowed a tenancy to be put in place before they had exchanged on your property. Their mistake.

You would be crazy to let them stay as guests.

Tell them to get an airbnb somewhere else. Their fault for renting their place too soon. The legal mess you could end up in if you let them move in before could be awful.

We have privately sold our property to a friend so no estate agent involved.
You've already broken the "don't mix business and pleasure" rule.
Don't let them in early; no good deed goes unpunished. If it goes wrong then you lose a friendship

Once, back in the nineties, we lived in a house in a now very expensive part of SW London. Landlord was an older guy in his fifties, we were twenties but developed a bit of a friendship when he moved back into one room after his divorce. Anyway, he eventually sold up, after we had bought our own flat nearby, to a supposedly wealthy bank trader young woman who was going to do it up, put in a basement, wine cellar etc. Anyway, she gave him a son story about splitting up with someone and having nowhere to live so he let her move in for a week before exchange. He asked us to pop round and get something for him out of the cellar (we still had keys, he was abroad) and we found the house ON FIRE as the silly girl had moved in, left a pot of hot wax on the floor that you'd use to wax your legs and her hair straighteners on, on the floor next to a newspaper, on the living room floor. Fairly extensive fire was underweigh on the downstairs part of the house. As exchange hadn't happened she was not insured and he was laible.They had a massive fallout in the end as it turned out her parents were buying the house for her and weren't prepared to fund the extra renovation costs involved in gutting the downstairs. She left and didn't buy the house, he had to fund everything.

I really wouldn't do this unless you are prepared to cover any damage or accidents.

This is a clear no op, legal or not. There are absolutely no benefits to you, and so many things that could go wrong. Like pp have said, they may decide not to complete and then you will have a lengthy and expensive time getting squatters out of your house. This may sound unlikely but it is possible. They could make a list of demands/changes that they want to the house, they’ve got you over a barrel then as they’re already in there. You’ll have to comply or try to evict them. And what happens if something happens or they cause major damage to the house like a fire for eg? You could be left with no house and no money. Don’t do it ffs! They can get an b&q and temporary storage for now. Or anything really. It’s their issue, not yours

We are part of a close-knit community and previously mixed business and ‘pleasure’ using each other’s professional services. So I’m confident in their word. It’s more the what ifs like what if their life circumstances change (one of them dies or something horrific) during this process…

Kind of feels like if we do let them move in, it would close the circle, we actually moved into the property before we purchased it too because of delays in the legal process so the sellers took a risk with us (although it was probate and had been vacant for a decade!).

That is seriously risk and I would not do that. you know your solicitor will strongly advise against it!!!!

Op don't do it.
You're paying the solicitor to look after your rights etc yet you're thinking about seriously undermine him and his professional advice.

We did this when we bought our first house. The sellers had moved out and we needed to move out of our rental. We asked if we could leave our furniture there until it went through- we were due to exchange/complete on the same day later that week. They said we should move in! Their solicitor advised against it but they trusted us and it all went through smoothly 3 days later.

I did this as part of an exchange and had it written into the contract that the buyer would rent it off me at £x per week until such time as contracts were completed. There was a delay between the two due to waiting for the leasehold to be extended, I'd already moved and she needed to relocate for a new job. No issues but it was all done by solicitors.

If you are tempted do not do this before you exchange! They move in decide not to buy...
They move in decide not to buy and not to leave either...they decide to buy but found XYZ wrong so want a reduction..
How many 'I trust them' disasters do you have to hear about before people learn TRUST NO ONE!!

You are choosing to completely ignore all the advice not to do this.
You keep trying to justify your (already made) decision.

I truly hope you don't regret it.

Thanks for your input everyone, it was incredibly helpful to hear your views 💐 We pushed hard against this without actively saying no- asked them to delay the rental. Now hoping that we can complete the sale before this becomes an issue!

Don’t do it OP, But I think OP has already decided, I can just imagine OP’s next thread, when it goes horribly wrong.

Don't understand why you can't just say no. It's obviously entirely inappropriate but you have some weird obligation to them.

Despite them being friends, it is a serious No No. you are up against every reason why not as explained above but especially insurance