Is it reasonable to ask vendor to rent so we can complete?

[Budsonthetrees]

Had an offer accepted very late December on a house and our vendor hasn't found anywhere yet. Do you think it would be reasonable to ask them to consider going into rented to complete the sale?

All paperwork and checks needed on our side are done as is the survey. We have just over 3 months left on our mortgage offer and we are concerned that the way things are going we won't have it extended and will end up with a higher mortgage rate. Or, because she can't find anything, she will pull out.

Any thoughts please? Normally we buy empty houses for this reason.

Yes it is reasonable. We moved into rented so our buyers could move in, as we had several accepted offers fall through and didn't want to keep good buyers hanging on. It breaks the chain and puts them in a strong position when they find something they like.

You can ask but don’t be surprised if they say no.

If it’s just the mortgage offer expiring that’s concerning you I would speak to a broker now about getting a new mortgage offer and what that looks like now. If it’s more expensive I would be telling the vendors you’ll need to renegotiate the price accordingly as the market has moved.

I was in the middle of a chain last year when my buyer (who took forever unnecessarily) decided with 12 days left on her mortgage offer that she was finally ready to exchange and expected everyone to be okay with this… this was a non starter for me or my vendors so I ended up taking a small hit on my sales price (based on her new mortgage being less favourable) as I wanted to get it done as a chain.

I think you'll need to have a think about a strategy here. You could;
Mildly suggest it and see the response (suspect a no, renting is wildly expensive and it'll eat into their purchase budget, plus most contracts are 12 months so they won't be in their new home until a year after)
Discuss with their agent and explain your offer might need to decrease if your mortgage offer changes because the seller won't move into rented/complete within the time period
Play really hard ball, find another house, confirm that if it doesn't go through before the 6 month deadline then you'll proceed with the other house and it's entirely up to the seller how they deal with that and what they do to make it happen (this will only work if it's easy to find another house and if it's hard for them to find another buyer)
Speak to your mortgage provider and see now what the likelihood of them extending it at the same rate would be.

It entirely depends how desperate they are to move/sell, the housing market in the area (how likely are they to get another buyer) and their natural flexibility. I'd be worried if they're getting outbid more than once, it potentially means that they can't actually afford what they want to buy. I'd personally not have spent money on a survey before the chain was complete BUT, if you do need to go with another house then you can "sell" your survey to the next buyer (we have done this before so recouped our £700 survey cost).

Good luck, it's a horrible process!

They are apparently in negotiation on another house we have found out so we will see where that leads. We have decided we are going to start looking at other properties now.
They did sell before and that fell through but we don't know why. Maybe they did the same thing and don't actually want to sell? Who knows.
Our solicitor has heard nothing from their solicitor either.
We are now prepared to walk away, even though we don't really want to.

Yes of course it's a reasonable question to ask. Three months doesn't leave you much time even if they find somewhere tomorrow, although they may give you a small extension.

The people at the top of our chain had the go into rented to prevent the chain breaking down due to mortgage offers etc.
They asked for contributions 🤣 everyone politely declined their offer, particularly as they were selling a house £1.5mil and we were all paupers below them.

At the other end of the spectrum, my PILS left someone waiting 18 months with an offer on their house while they found the perfect bungalow.
When they finally found one, MIL said she was considering asking for more for the buyers because house prices had gone up in the meantime. I nearly choked on my coffee.

But CF anacdotes aside, yes, do ask.

Sounds like a sensible approach. No point pulling out and putting yourself back at square one, when there’s still a chance it will work out and you haven’t even found another house you want yet.

However by starting to look around again you keep your options open, and can pull out if you decide to move forward with another house.

Probably worth asking your vendor’s estate agent about other properties they have available, so they know you are looking. The EA will then become scared they are going to lose the sale and their commission, and will start putting pressure on the vendors.

Probably worth asking your vendor’s estate agent about other properties they have available, so they know you are looking. The EA will then become scared they are going to lose the sale and their commission, and will start putting pressure on the vendors.

I like that idea Doris, thanks

Yes, although make it clear you're looking with other estate agents and perhaps have viewings lined up - they won't care so much about losing this one if they think they can just get a sale on another of their own properties. This happened with my parents' buyers and the EA really made no effort to stop it because they'd found them another property....

"We are in Ireland so the chain thing doesn’t really work here like it seems to do in England. "

Yes, I live abroad and chains don't seem to be a thing here. I'm not really sure why. It's true that some of the flat I've looked at are already empty because they were rentals and the last tenant has already left or because the owner occupier has gone into a home. I wonder how it works if both parties are owner-occupiers...

I did this for my buyers when my onward purchase fell through last minute. I found another property quickly and thought I’d be able to rent for a few months but had to signup for min 6mths, at a much higher cost than my mortgage. Just as well as my vendors still aren’t ready to move 5mths on!

It's perfectly reasonable to ask but I'd be surprised if they agreed. New renting rules are coming in soon and predictably that's led to a huge shortage of rentals. Loads of landlords are evicting their tenants to sell up (a renter colleague is one of those affected. He's struggling to find a new rental despite a decent salary).

Quick update, we have found out today that they haven't sent back any paperwork to their solicitors yet. To say we are not happy about this is an understatement. Considering our options now

The thing is, if they haven't found anywhere to move to, it is completely normal that they wouldn't have started the paperwork for their sale, because it's not proceedable. It's more surprising that you have gone ahead on the legal work to be honest, that's very unusual, normally until the vendors have found somewhere everyone would just wait, and then if they didn't the sale agreement would probably collapse. I understand your disappointment, but they haven't done anything wrong or abnormal here I don't think.

Yes exactly this. When we accepted an offer on our house, we didn’t complete any paperwork until 4 weeks later once we’d had an offer accepted on our purchase and we knew it was definitely going ahead.

We had very excited first time buyers who submitted their paperwork straight away. Little did they know we were close to pulling out when we struggled to find a house that suited us. But it all worked out in the end.

This probably answers your original question OP. It looks like if they can’t find a house they want then this isn’t going ahead, so there is no way they are going into rented.

you can ask, but put yourself in their shoes, how would you react in their situation?

short term rentals will be easier to acquire now the law has changed, but it is still dead money to them and effectively a further discount they are giving to you.

I once waited nearly 5 months on a property she said she would move into rental if she could not find a place. Meantime the house 2 doors down from her came on the market and completed at less than I had offered her. I put the pressure on and she finally decided she would not move at all and took it off the market (I think allied to her getting a better financial settlement than expected in her divorce)