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Buying a property with sitting tenants. Notice has been given by current landlor

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Author Topic: Buying a property with sitting tenants. Notice has been given by current landlor  (Read 142 times)
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« on: June 16, 2021, 12:14:17 PM »

Hi,
We're in the process of buying a property that has two self contained cottages attached to the main house. They are currently being rented out. One tenancy has passed the fixed term and is on a periodic basis, the other has three months left of the 6 months fixed term. The seller has said that notice has been served to the tenants (with Covid current rules, June 2022, we understand that to be four months notice).

We want to continue with our purchase, taking over as the landlord with the knowledge that the tenants have been given notice and they will be leaving a couple of months after we have bought the property. I want to check that my understanding is correct, that the notice still applies even though there will be a changeover of landlords? Is there anything else we should be considering or concerned about (we are aware that we need to inform the tenants in writing of our details once we become the landlords)?
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« Reply #1 on: June 16, 2021, 12:41:25 PM »

I am not clear about this.If  you mean to continue letting out these cottages, so what was the reason for serving notice? Had you insisted on this before going ahead with the purchase,maybe because you don't approve of the current tenants?
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« Reply #2 on: June 16, 2021, 03:01:11 PM »

We don't want to continue letting the cottages out because we want to use them for holiday lets I just want to know if the previous landlord has served notice to the tenants, then the notice period will still be carried over when we buy the property and if there are any other issues we should consider?
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« Reply #3 on: June 16, 2021, 03:53:25 PM »

I presume you're not in a position to wait for vacant possession. You seem to be relying on the vendor's having served a valid Section 21 in each case, and that the tenants will leave as requested without further proceedings. Is the vendor prepared to indemnify you for all your costs if the tenants don't leave? Talk to your solicitor.
Newbie
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« Reply #4 on: June 16, 2021, 04:14:26 PM »

Thanks for your reply Simon. We don't want to wait for vacant possession because finding a rental for my family is proving too tricky. Good point about the indemnity though, thanks.
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« Reply #5 on: June 16, 2021, 07:44:30 PM »

I'm assuming AST because you mentioned four months notice, and I'm guessing England for likewise reason.

If that six months fixed term is their first fixed term, i.e. they're only 3 months in from first moving in, then the s21 is not valid in England.

The risk is decreasing as time passes but non-zero, how sure are you they are on AST and that they aren't leftover Rent Act tenancy. That's either someone who's been around since before 15 January 1989, or succeeded to such a tenancy (so just cause they're relatively young doesn't guarantee anything).

I doubt you'll get them indemnifying you for cost for the tenant not voluntarily leaving, but I'd try get one at least for extra cost incurred if the notice isn't valid and also any cost or damages incurred by you from original's landlord wrongful action or inaction, e.g. any deposit protection penalty for non-compliance. Speaking of, gets details and evidence of all paperwork - deposit protection and prescribed information, gas safety certificate, electrical installation condition report, energy performance certificate, How to Rent booklet.

Have you considered how you're going to transfer any deposit protection over to you, and the relevant legal timeframe to do so?
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« Reply #6 on: June 17, 2021, 10:33:19 AM »

There are plenty of things you need to look out for... but... although you might be using this forum as a sounding-board for your own ideas and cross-checking them with whatever your Conveyancing Solicitor is telling you... I'd be nervous if your side hadn't already raised some of these things (with you, at least, maybe not with their counterpart)... if not, and they consider it outside their remit, then I'd be OK with spending a little more with them to get someone from their firm on board who can also be advising you on this... there are the issues of the invalid notice, the issues of the Tenants staying on well beyond what you expect (although they might still pay rent, but it scuppers your plans for lucrative holiday lets), making sure you formally notify the existing Tenants of you being the new Landlord... and, of course, double-checking that the current Landlord (the Vendor) has done everything above-board with regards any obligatory safety checks and various pieces of documentation regarding the Deposit - which could be costly if it ended up falling onto you, through no fault of your own.

As you are unwilling / unable to wait for vacant possession (always the smartest move) it sounds like a checklist is required.
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