Offering on house as sitting tenants?

[rocketfairy]

DP and I weren't expecting to be buying right now, but our landlord is selling up due to mortgage increases, and we like the house.

Good area, neighbours, transport links, minimal maintenance issues (some mould).

It's hard to predict but we think the house would probably work for us for the next 5 years. We are planning to start a family in the next year. Our joint earnings and savings are expected to grow significantly in the next decade.

We would be first time buyers and have got around £30-35k savings.

Rent is £1350, mortgage might be around £1700 with say £1300 on interest initially?

House will be going on at £335k. There are not many recent comps. Similar houses were sold at around £270-310k a couple of years ago.

Recent listing prices in the wider area seem to justify the £335k but not sure if they are actually selling at those prices! Though one sold for £365k on our road a few months ago. It is less desirable to us but has one more bedroom.

We don't really know what we are doing re house buying!!

Our tenancy ends soon, then it goes onto rolling. We haven't been served notice to quit. The landlord wants us to stay in the house as tenants while it sells, to avoid a vacant period.

We feel we must have some leverage/advantage as sitting tenants (for example, they can't arrange viewings without our agreement while we are here) but we don't know if this will mean anything in negotiations or even whether we should be buying right now.

Does anybody have any advice?

I would look on Rightmove at Sold prices to get a firm idea of what similar houses in your area actually sold for in 2023, though the data is always a few months behind. I think right now the latest information is showing sold prices up to October 23. In some areas prices won't have risen in the last couple of years, they may even have gone down.

I don't know your area obviously, but people expect to knock a bit off the asking price as EAs tend to be optimistic in their valuation figures. So if a house is listed at £335k for example, people might think about offering around 300k then the owner may reject that figure (if the house hasn't been on the market for long) and they negotiate. Or they may just stick at 300k and risk the owner selling to someone else, because they genuinely don't believe the house is worth more than they have offered, or it isn't worth more than that to them.

It sounds like the LL is being a bit greedy wanting you to stay in the house while it sells to avoid a void period because tenants are not obliged to accommodate viewings. I would probably inform the LL that you may wish to buy the house yourselves to find out what figure he says he would sell to you at. It would be great if he would offer you a good deal. However, it is important to do your own research into what the property is worth as you don't want to overpay.

Agree with Twiglets1 - your landlord sounds very optimistic on the value. A good chance that it may not be worth now what it was 2 years ago...

If you buy it privately he would avoid EA fees. So that’s worth money.

Are you a Sitting Tenant or a tenant in situ? They are very different things. A genuine and lawful Sitting Tenancy confers a huge financial advantage.

Thanks so much for your help!!

We’ve only been in the property a couple of years so tenants in situ I suppose.

The sold prices are thin on the ground for similar properties but it does look as though it’s a bit overpriced. It was on at £300k in 2020 and didn’t sell.

If true market value is say £315k, would we be in a position to negotiate to pay a bit less as current tenants, or not really?

EA (sales team from lettings agency) is already involved in the sale so I don’t know if a private sale would be possible. Wish LL had approached us first!

All you can do is ask. The landlord may be willing to accept a lower figure if he just wants out of the increasingly burdensome responsibilities of his position.

I suspect much will depend on whether or not he has already made a formal contract with the estate agents.