UK Landlord Forum / Life

My son is buying a flat that has a tenant in situ - the tenant has a 12 month contract with the vendor which will expire in October 2014.  What are the legal ramifications here?  My son is happy for tenant to remain till October as he has a tenancy himself that will not expire till then - but is it safe for him to let the tenant remain, or would tenant have any claim to stay?
If tenant remains what would my son have to do to ensure his departure on due date?

It doesn't come to an end in October it would change from a fixed tenancy to a rolling tenancy.  Your son would need to issue a section 21 2 months prior to this date. If the T didn't move out on that date by issuing the section 21 it gives your son the opportunity to apply to the courts for a possession order.

As part of the sales/purchase process, your son's solicitor should be securing a signed agreement from the tenant that he is aware of the change in ownership and that he is content to move out on the date requested.

There would ideally be some compensation mechanism if the tenant declined to move out (a repossession order costs money)!
I've never managed to get this though, but I'm a landlord and I like properties with existing tenants and don't normally want them to move out.

The conveyancing also needs to cover any deposit that was taken.

More to the point, your son needs to know that he's about to be a landlord and what that means.
He'll need to handle the deposit in the right way, pay tax on the rental income and maintain the flat if anything goes wrong (which is probably not an issue if your son is planning to move in afterwards).

A lot depends on the tenant.
To be clear (in case your sons solicitor isn't), the tenant has a right to live in that flat until whatever date in October.
You can't ask them to leave earlier than that (well you can ask ever so politely, but the tenant doesn't even have to respond or could ask for compensation etc).

When the fixed part of the lease expires the tenant can just leave, but if they don't, the lease just becomes a monthly rolling contract with a months notice either side.

So your' most sensible option, as noted above, is to issue a notice to quit two months before the end of the lease.

If the tenant then doesn't leave, you can go to court, get a possession order and hire bailiffs. Which costs a few hundred pounds (which you can try and claim back from the tenant).

That's all a bit pessimistic, but you did ask!

Thanks for the help - doesn't sound as formidable as I'd initially thought.

The fly in the ointment here might be the fact that you say your son is happy for the Tenant to stay on until October because his current tenancy runs until that time. However, if your son leaves his home at that time but the Tenant in the flat he's purchased doesn't, what are the implications?

Can he stay at home until his repossession works its way through? Would he end up being a "bad Tenant" himself by staying on beyond the time the Landlord wants at his current property?

Just remember that giving notice, via a correct S21, around two months before the current fixed term ends does not guarantee that the Tenant will just get up and leave. I bet the majority of the time it does happen this way, but there are plenty of times it doesn't and the Landlord can do little about it, quickly at least, they can just start another process.

Only thinking of negatives... everything might work out perfectly fine. But, as said, in the time running up to October your son will have responsibilities as a Landlord and these include various things like checks (if due, like gas - not sure if the flat would have that), protection of deposit (make sure it's properly transferred from current Landlord) and repairs etc.. If all this is not desired at all, then it might be worth taking extra time looking at another property... sounds like he's almost there though.

Yeah, survey has been carried out - seems OK.  Should he try to get vacant possession? ( would he be able to, surely the tenant has a right to stay till the end of the original contract?)

It depends on what is wanted. If your son wants to avoid being a Landlord at all costs, then try for vacant possession - yes, the Tenants are able to stay until the end of the fixed term (a change of Landlord doesn't change that) - however, there is always negotiation and agreement. It's not even your son's responsibility if he wants to push it with the vendor... you just place that problem in the vendor's court... but, from what I'm reading, I get the impression this purchase is some way down the line and it might anger people changing things at this stage.

But if your son is happy having some Tenants, providing him a bit of income while he sorts out his own stuff, then go for it - just be aware of the responsibilities and don't get caught-out... things like deposit protection are a good one to pay attention to.

It seems like being a temporary Landlord suits this situation, but who can really say except your son?

Here we go - the solicitor has now contacted my son and issued a contract which states - vacant possession.  We have again advised that there is a tenant in situ and solicitor is asking if son wants him  to write a new tenancy agreement.  Aren't solicitors supposed to know what to do ? He keeps coming back asking us what we want to do - told him we're looking to him for advice (and PAYING him for same).  Any suggestions please?

Is the solicitor not simply asking if you want to extend his work scope? I mean, creating a tenancy agreement is obviously outside what the scope of his conveyancing was supposed to be... the basic stuff. If he does anything else for you, he'll want paying. To be fair, I've not yet seen a response from you that confirms whether your son wants vacant possession or wants to be a Landlord (at least for a while). Apologies if I've missed it, but I can't see it and it was kinda up in the air the last time this thread was active. I would add that Conveyancing Solicitors are not the brightest of the bunch, right? They often need leading by the nose.

In answer to your question "Aren't solicitors supposed to know what to do ?" I'd reply "Yes, but only when you've told them!"

My son wants vacant possession and wants to move in, but when he was viewing the flat he was informed that there was a tenant in situ until October.  So he thought that he could not do anything other than accept that fact, hence my earlier  questions about ramifications.  He does not want to be a landlord, merely an owner/occupier.

OK, it's nearly 2 months since you started the thread, so can I ask whether your son has taken any of the advice previously offered? Either commence his own negotiation to obtain an agreement all parties are happy with or punt the problem back over to the vendor and forget about it? He wants vacant possession = he gets vacant possession or he walks away from the sale, right? It sounds like your son has agreed to purchase the property, whatever (I might be misreading that)... that is not the way to go about things, really. He gives himself the problem, when it isn't his problem to start with.

If he's accepted there's a Tenant in until - at least - October, then I'm afraid he's made his own bed by not saying "no" to this and demanding vacant possession as a condition of the sale. I've got to say - if I had no interest in being a Landlord, that's the simple condition I would've insisted on.

So, perhaps he should then delay completion until the tenancy agreement has expired - day the tenant moves out is the day he moves in?

Expiration of tenancy agreement is not necessarily the day the Tenant moves out, right?