Don't want to loose buyer, close to exchange, had to pull out of property we are buyingwe are buyi

[Joelijane]

Hi,

I'd love some advice please. We are approaching exchange with our buyer. They want to be in by Xmas day but we've had to pull out of our onwards purchase due to work required exceeding 25k after investigations. Would you advise us to go into a rental? If so how does that work when buying a property? Will we be seen as proceedable or a pain trapped in a tenancy? What should i get knowledgeable on? How quick could we get into a rental? We don't think we can push back too much on exchange (maybe a month tops) as want to maintain the relationships with our buyer. First time being in this situation so any lived experience so welcome 🙏

It's taken us 3 years to sell due to different reasons so 100% want sale to go through.

Thanks

We rented through OpenRent which seems to have landlords with more flexible break clauses (at least in our area). We ended up being in for 7 months. It is a massive hassle to move twice but was worth it for us to preserve our house sale. We also put a lot of stuff in storage and rented somewhere much smaller than we would ever live in. We were seen as far more proceedable as we had nothing to sell and we already had our equity from the old house in the bank. It worked for us!

Speak yo your estate agent, they’ll be keen to help you find a rental property as they’ll want the commission.

At this point you'll be expected to sign a 6 month fixed term tenancy and you should be able to move pretty quickly once you find one. That will give you 6 months to find a new property to buy, do all the conveyancing and complete which is quite realistic. There's. Possibility you may be pushed to complete before your tenancy ends, depends how quickly you find a place and the chain situation but chances are it will take more than 6 months anyway. Bear in mind you have to give a month's notice to end the tenancy which you'll be able to do from month 5.

If it’s taken three years to sell I would definitely rent. Also, I don’t think the housing market is improving so you are unlikely to better the price if the sale falls through. It should put you in a good position to buy as you would be chain free.

OpenRent sounds great or as PP said, your agent may have some ideas - they will be motivated to help you.

In a similar situation we went into a rental. If you can rent something reasonably priced - and I know that is a big caveat - even having to buy out the lease may prove worthwhile. And that is the worst case.

There are new rental laws coming in next year anyway so you can't be tied into a long contract so I would not worry about it. I rented between houses and signed up for a year but ended the contract after 9 months landlord was fine about it as the house had folk clambering to rent it out I just had to pay the relisting fee.

The last two times I’ve left a house via OpenRent, it’s been to people, who were in between moves.
The minimum contract period signed was six months but we verbally agreed, that as long as the tenants gave as much notice as possible and allowed viewings, we’d be flexible about ending the term early. It’s worked out very well and I don’t have the commitment of housing long term tenants, in these very uncertain times.

We had similar problems a few years ago…needed temporary accommodation for a couple of months…..it was winter time so we rented a farm ‘holiday let’ at a good out-of-season rate…loved it so much we offered to buy it! Owner wouldn’t sell.
Holiday let means everything is there…bedding, kitchen bits, garden usually taken care of…means you can put almost all your possessions into storage.
Hope your move… when it happens… goes smoothly.

We agreed to move into rented to ensure our sale went through and I’m glad because the market is now dead (for flats) and if our sale has fallen through I’m not sure how long it would’ve taken us to find a buyer.

I agree with all the others. Definitely proceed with your sale and move into a rental to enable this. Have you tried negotiating with your sellers or has whatever was found put you off completely?

@kirinm have you moved yet? I know things were challenging for you for ages. I hope they have worked out now.

Just something to think about - not sure how much rents are where you are but for me, renting for a year will cost more than £25k minimum. Would you rather that money is given away to a landlord or spent on the renovations for the house you almost bought?

This is good, also. Cost benefit analysis, OP

Could you put your stuff in storage & do a long term Air BNB?
As it’s been a long time to sell I’d carry on with your property

We also moved into a holiday let for four months when selling our house and waiting for our (then) new build to be finished. Worked for us.

You could try air bnb for a rental and put your stuff into a storage facility

Even long term Airbnb is a lot more expensive than a regular rental. Since they don't have a property to buy yet a 6 month tenancy will be cheaper than at least 4 months of Airbnb.

The owners of the property have been quite arrogant, concealed work needing to be done and when we've gone into do subsequent surveys, it's been revealed they have let the property go to wreck and ruin. Not heated or ventilated, let mould grow up the walls, let things break. Theyve never maintained their property, cleaned gutters etc leading to bad damp issues and render cracking. We'd have to hack off plaster off whole left hand wall due to extensive penetraring damp. I'm in London, it's 475k. We offered on the assurance no work was required as we can't afford to live somewhere else and just need to move in and carry on being able to wfh straight away. Which now looks unlikely

Fair enough. It doesn't sound as if they are the type to be fair or honest with negotiations.
If you so rent now, you are likely to be a far more desirable buyer as you would come without a chain. Also, prices are continuing to fall in most places so possibly two reasons why you may end up paying a bit less.

I think anything paid out on rent will probably be equal to the amount your future purchase will drop by. Ie on a £500k house a drop of 5% is £25k.
Rachel Reeves incompetence could well work in your favour!

We are completing on 28th! We exchanged last week.

Can you not renegotiate with the owners of the property you were buying ? £25 K will disappoint very quickly in rented and storage and two lots of moving costs , better to get them to drop half way and you won’t have lost out

Oh protect your sale at all costs. Go into rented. I imagine the market could be in free fall post budget.

We went into rented for different reasons, we were moving to the other side of the country and wanted to be in situ for our property search. It worked out perfectly and we completed just as the initial 6 month period was up.
The interest from equity contributed significantly to the rent so it wasn’t as much of a financial outlay as we thought initially.
It meant that we were chain free for both sale and purchase which was much less stressful.

We ended up selling with no onward purchase due to relocating and had to live with family for a year.

Check rental availability and any conditions on renting by ringing agents now. Short term rentals were impossible as high competition meant landlords only wanted long term tenants. We tried negotiating a long term let on a holiday cottage over winter, but it was expensive as they were furnished so we would have had rental and storage costs, and there was no security of tenure so with young children we felt it was too high risk.

Consider that you will incur double moving costs and possibly storage costs, for example if you end up renting something smaller or without a garden you may need to store outdoor things or some furniture. Our family member had little room for our possessions in their home so apart from toys and clothes most of our things went into storage. We used the same company for removals and storage but didn't have instant access to our possessions as long term storage arrangements meant our stuff was stacked high in big shipping containers.

Beware how unsettling it can be not to have a permanent home and uncertainty on when you will move. I found it really stressful as did our children, and it made settling into our new area more challenging than it would have otherwise been.

It took ages to find somewhere to buy. One purchase fell through after 4 months as the vendors couldn't find anything to buy and took their house off the market. Then there was nothing suitable for us to buy for months. I was reading threads on here from posters who had got stuck renting for years!

Consider that time out of the property market means you don't have an appreciating asset and are not paying down your mortgage during that time. We had to keep our sale equity in safe savings accounts at a time of high inflation so it wasn't a great financial move.

It did put us in a great proceedable position for buying and we were relentless with local estate agents, some of whom let us do early viewings on properties before they went to market as they knew we were serious buyers, but I wish we had been a bit less hung ho and wouldn't sell without somewhere to move into again.

Lots of people go into a rental in this exact situation. It actually makes you more attractive to sellers because you’re then chain-free. As long as you keep things moving with your buyer, you shouldn’t lose them.