How much would you offer to buy your rented house?

[beetlejuicebeetlejuicebeetle]

DH and I have been renting a house in SE London for the past 4 years. The LL thus far seems sensible and values having a long term responsible tenant over potentially charging much more for rent (we have yearly increases but the local area has exploded due to the opening of a new train line.)

The house was bought in 2018 for £380K. The equivalent houses in the area range from £400K to £450K depending on exact location - ours is on a nice street and very close to the station so we imagine it would be the higher end. If the LL did the house up and sorted some niggly aesthetic issues he could sell for closer to £500K.

How much would you offer the LL? Obviously, he may not want to sell as he will never struggle to get rental from it, however if he was to sell to a sitting tenant, he would be saving a considerable amount by no empty property while selling, not having to pay to put the house 'right' etc etc. I do not want to be insulting but also...shy bairns get nowt!

You could ask him if he’s interested in selling it as a starting point. If he is he could get 3 EA valuations & you go from there. He needs to not instruct an EA though so would potentially save on the fees.

The landlord probably won't avoid agents' fees unless no agents were involved in the letting so he won't get that saving.

He'll save any gap though as he won't have to have the property vacant during the sale period and will know that you know all about the house already. Definitely worth asking - you never know.

Are they selling it? It's not clear from your op.

If the area has exploded in rental prices since the opening of a new train line and your LL bought the property for £380K in 2018, £450K seems to be fairly modest in growth over 6 years especially since the recent house price booms. I was expecting you would say properties are going for much more than that. Houses in the area we are looking in have gone up so much more in that space of time and it's not London 😩

I have sold to long standing tenants before and sold at the going market rate but deducting the estate agents fee. (Substantial on a 500k property)
Both sides then benefit.

I'm trying to sell to a tenant just now. She just instructed a mortgage valuation without asking us first. She did know we wanted to sell to her tho as I want to retire and I'm not in the business of dehousing people with kids.

She's getting a pretty big discount, tho I'm not sure she realises that. I do have to pay agents' fees as they manage the tenancy and it's a clause in the t & c.

Ask your landlord if he wants to sell, get a few valuations and negotiate.

I think we wouid request the LL follows @Twiglets1 advice in getting some valuations if he had interest. The value of £400-£450 is based on similar properties in the area, variation seems to be specific location and finish. Our house def doesn't have the finish. I could be way off of course - no houses on our actual road have been sold since we have been here.

@@SquishyGloopyBum no they arent selling but we are looking to buy in the next year and would ask the LL if he was interested in selling.

I can’t imagine they would be wanting to sell? I presume if they only bought in 2018 and have been renting it since, that they bought as a long term investment. Selling now after just 6 years for not much more than they paid for it wouldn’t make sense. They will be getting more per year in rent than they have in property increase if you offered £430k

I agree, I think he would be bonkers to sell but I am also getting the impression hes a bit 'over' being a LL atm - he used to deal with issues instantly but he lets problems drift on for months now......Always a chance his circumstances would change!

That seems cheap for a house in SE London. Is it in zone eleventy-million?

It’s £800k+ for a bog-standard Nunhead terrace these days.

This is exactly what we did when we bought our first flat from our landlord.

Tax has changed for Landlords, very punitive. It's very different now & people get older too. Good luck.

We did this. Landlord got 5 estate agent valuations. Used a slightly lower value than the average and knocked off the estate agent fees (I think they knocked off 7% in total as they said it made up for the hassle of us moving out, time spent getting people in, cleaning, etc.).

There are lots of properties for around that price in zones 4/5 London, especially South East; Abbeywood, Plumstead, Welling. Sidcup, Bexleyheath to name a few. Generally a good commute too.

I bought my rental house. The landlord got two valuations, and we met in the middle.

I paid market value for it. She bought it for 80k and sold for 137k

On the information you’ve provided - which isn’t enough really. I would offer 450.

We are in one of the areas mentioned......

Lol, its Zone 4! Great transport but not yet gentrified.

If LL wants to sell I think this is fair. OP you need to check if LL is willing to sell first. Then if they are willing get in 2 or 3 EA to value the house. Work out fair market value then deduct the fees LL would have paid if going through EA.

Market value surely.

The LL would make not insignificant savings by selling direct to a tenant.

Unless they actively wanted to sell, why sell to a tenant for anything other than above market rate? Offer £450k

Market value minus 10-15% as they won’t have to pay estate agent fees or costs or removing items (assuming you would buy the property as is).
We did buy the house we were renting 3y ago :)

(We rented for 2y and the LL wanted to sell after that)