Updating post from Reddit.
I’m in urgent need of advice from fellow landlords. I’m about to complete on the sale of a property in just a few days. Contracts have yet to be exchanged and the buyer expects vacant possession on completion.
The tenants, whose contract has expired, agreed to vacate before the sale. We had a mutually agreed date, and they confirmed they’d be out. However, I’ve now been told by the managing agents (with just days to go) that they’re refusing to leave. They claim they couldn’t secure another rental and want to be formally evicted in order to qualify for council housing.
I’ve spoken to solicitors, and it looks like I’ll need to go through the full Section 21 and court possession route, which could take up to 6 months. The buyer is unlikely to wait, so the sale will collapse and I’d likely lose thousands in legal fees and a potentially rare buyer.
Has anyone dealt with a similar situation?
This has come completely out of nowhere, and I’m trying to stay calm while weighing my options. Grateful for any insight from those who’ve been through this before.
Cash for keys is your only option out. Even then I doubt they'll take it considering the short notice.
You'll need to go down Section 21 route I'm afraid or Section 8.
You need to make your cash for keys offer so much that they stop listening to common sense, because if they've decided they want council accommodation it's most likely because they've realised that another private rental to the size / quality they need just isn't realistic, rather than it simply just being about them not being able to find one in the first place.
With that in mind, you need to offer enough money that they:
There might not be much difference in the two amounts. I don't know what it is, but £10,000, £15,000? That's a lot of money to most people.
And if your sale does fall through, don't blame yourself - to be perfectly honest your buyer was just as naive as you, here. Advice is the same for both parties - don't get involved in the sales process until the tenant is out - an agreement that they will leave is never enough.
Appreciate the advice. Unfortunately not in a position to offer close to that amount - not until the sale goes through anyway. Lesson learned
Exchanging contracts of sale before you had vacant possession sound so utterly bonkers that I find it hard to believe this isn't a wind-up. Why did your solicitors allow you to exchange while tenants were still in situ? It doesn't make a lot of sense.
Assuming this is a real post, what's the penalty for failing to complete after exchange -- 10% of the sale price? If you can get your tenants to accept any amount of money below that number to leave immediately, you're quids in. If not... oof.
Exchange has not happened yet, but was fixed for a date shortly after date agreed for tenants to handover keys. Lack of experience on my part but sincerely did not think this was even a scenario that would occur
Your post says "contracts have been exchanged." If that's incorrect and contracts have not in fact been exchanged then, hard as this may be to see right now, that's actually fantastic news for you.
Yes, you're looking at months and months of eviction process ahead of you, and the prospect of finding a new buyer afterwards, but that's still better than losing 10% of the sale price.
Apologies for the confusion - they have yet to be exchanged. I'll update OP
Cash for keys.
And as a lesson to anyone else. Do not exchange unless tenants have already left.
How did your solicitor allow it.
You are at risk of losing at least 10% if property value so anything under that to the tenants will be worth it.
To clarify - I have not yet exchanged yet, but date was fixed for days after expected tenant handover. That was a mistake in my original post apologies
To clarify, exchange hasn't happened (that was my mistake in OP) but it's so close to when the property was expected to be empty that it probably makes little difference
Yes it now might screw up the sale.
But you are not on the hook for compensation etc
You may lose this sale but overall it may be better to get vacant first and then proceed.
It’s standard practice for councils to refuse to accept people are homeless unless they have been evicted by bailiffs. There is a massive shortage of social housing and this is an inevitable result. You could try cash for keys, and also remind the tenants that the accommodation they are likely to get through the council is not going to be especially desirable and if they are in London or the south east they could easily end up up hundreds of miles away. But if this doesn’t work then S21 is the only way and it will take several months minimum.
What solicitor allowed this to happen?
Unfortunately they have probably been advised to do this as well. Especially as they will know they have you over a Barrel
Do private tenants who choose to rent property from private landlords think they will get the same level of accommodation from councils who have over-stretchec budgets? Won't a council put them into emergency accomms first? A family of a mum with 2 children under a certain age can be put into very small places. Emergency accomns come with restrictions such as no alcohol permitted in the premises. Been there done that with a landlord on our road who lets to the council.
Rant alert! He gets obscene rental amounts, the council always keps his place rented and the council pays for all repairs including damages. However there is no exhaust fan in their bathroom snd the shut window is always covered in condensation. Am sure there must be mould. This is the same council who gives hard working landlords a maze of rules and regs that are driving them to sell. 😒
Been through the exact same scenario, my tenant agreed a leaving date, day before announces he’s not going anywhere and take him to court. Just 1 week before sale completion. Your only option here is S21, I used Mark Dawson of AST, highly recommend. I didn’t actually get as far as court though as I think I fell lucky and believe this is only because it was a homeless charity who were buying my property. I truly believe the council only rehoused my tenant because of this as the charity work closely with the council. I feel your pain but AST took a lot of the worry away.
Thanks for your comment really appreciate it. I can only hope for a similar outcome
The tenants probably planned to do this all along and have just been stringing you along .
S21 is the legal route. I would imagine you should have started that when the buyer decided to buy.
Cash for keys is your only option I suspect, but other might advise better.
Formal eviction also helps them as they can secure council accommodation as you are essentially making them homeless.
Estate agents have been forward to admit that intentional homelessness is their intention as they are seeking council accommodation. I sympathise with their situation but doesn’t the council frown at such things?
In most areas the rent has been going up quite drastically making it a lot less affordable.
In most cases people who have been in long term rent are on lower more affordable rent than local rates as they are definitely going at least in our area.
Them failing to secure alternative renting might be truer then you believe and council provided accommodation tends to be more affordable but again its definitely cheaper in our area by £500-700 a month via council then private route.
Just donate the house to them, theyre the ones living there
Issue your appropriate notice. Question for others - if there was formal open correspondence, could he not take the tenant to court for breach of agreement, his costs and potentially dimunition in value?
I’m so sorry this happened. Must be so stressful.
this fully makes me want to kms, i read so many of these which puts me off renting my flat( just away to start for the first time) and i keep saying its just a small percentage.
Sorry to hear, this sounds so so so so so awful, makes me so mad theres so little to do and its just the council going " lol, dont leave, get evicted and we can house you"
who cares about the thousands of pounds for the landlord.. everything in this country is now just screw this person to gain another..
I mean the landlord could have made sure the property was empty before listing they have taken that risk and learned the hard way. I agree everything is crap but nothing will ever improve.
Just a thought how do people become equal to people like bezos when they don't need to pay tax but we all do. It's not a fair system at all no wonder all our systems are failing.
Ive learnt the hard way for sure. Had to sell out of necessity and timed the listing to near the end of their tenancy thinking it would be smooth but clearly not :(
You should have timed it to the end of eviction via s21 not the end of tenancy as tenancies don't end they roll.
Yeah really disheartening. We really tried our best to be good LLs and even offered to sell to them below market value if they were interested but like you saythis action is something they’ve clearly been advised to game the system.
How would that have come about? They are willing to go the eviction route for council housing that may not be so great when they eventually get placed. So what resources could they hzve had to buy your property? 🤔.
Long standing tenants (4 years+) who have never missed a payment. We informed our intention to sell about 5months ago, and out of courtesy wanted not to disrupt their lives (and also a quick sale). They said they couldn't afford our offer, so notice was served not to renew AST. Did not expect that they would unable to rent elsewhere either
Or you quit worrying and just get the tenants out before putting it on the market.