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Help - what should I do - inexperienced landlord

Started by rosabug, August 11, 2024, 09:31:13 AM

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rosabug

Hi

I am 63, rent in London (i'm lucky I have a long tenancy at a low rent). Unable to buy in London where my job is,  I bought a small house in a southern coastal town in 2018 for @250,000. I still have £90,000 left on the mortgage. It's worth between £280,000 - £310,000 now It's unlikely I will be able pay this off before I retire and will likely need to sell and buy somewhere smaller if I want to live there or continue to rent it out - which would cover my rent in London. This is the only property I own. I have an interest only mortgage but overpay as much as I can every month.

However my house is Georgian and has old wooden casement windows and all that comes with an old house. I do not have the money to replace the windows for example. and I'm concerned about new laws coming in. I would need to terminate my current tenants 6 month contract (since 2019) and clean and decorate the house before i put it on the market. My tenant (it has recently transpired) have the beginnings of a hoarding issue and has not been keeping the house great. This change over can only happen in summer 2025 (because of my job and time and the house being a 1.45 hr drive away).

Should I sell and buy smaller now making sure the new property is up to spec for renting? Or have I answered my own question?!












South-West

#1
Assuming your income is sufficient to cover the mortgage without rent for a year, I would be seeking to evict ASAP this year.

Then take time to clear and redecorate before putting it on the market in Spring - the best time to sell and THE peak time for someone buying a coastal property as they will wish to move in before the summer.

Then, hold back on buying your smaller property until the winter when sales slow down and you have a more favourable market for a buyer. You may even buy elsewhere as far better value away from the south coast.

OF COURSE - there is no telling what this new Government will do so any number of things can spoil the best plans, but you cannot predict what they will be so just have to make a decision and go for it.

jpkeates

The government hasn't explicitly said what it plans to do and over what time scale. It sounds as if your concerns are about the EPC rating (there's nothing specifically wrong with old windows unless they're defective). So, until they do, anything you plan to do will have an underlying layer of uncertainty.

But it does sound like you plan to do something, so your time scale is something you need to think through. If you're definitely going to sell at some point soon (ish), I would start the conversation with your tenant to explain that you are planning to sell at some point—not right this second, but in the foreseeable future—and that they need to start thinking about finding a new place to live.

Explain that you don't want to pressure them by giving notice and making things difficult. You'll be as flexible as you can be when they find somewhere else. But this is really going to happen, and you want to make things as easy as possible.

rosabug

@South-West

Thankyou for your reply. I have an issue with selling and clearing in the time frame suggested (tho it makes sense)  because of my job, which is quite demanding and means in reality I can only really do all this in July - mid-september. Where else would you suggest that is reasonable driving distance from south london?

rosabug

@jpkeates

Thankyou - that is good advice. My tenants are a bit odd and I am worried about problems arising from terminating their tenancy.

They are, in my opinion, at the beginning of having a hoarding issue (1 spare room is full and the downstairs living space is now started to be used as well - for 'stuff'). I am wondering whether to mention this at all now - given I will be terminating their tenancy anyway? They seem a bit sensitive/touchy and if I'm honest I don't really trust them or how they might react.

I was thinking of letting them know at the beginning of their last 6 month contract - so giving them plenty of time.

Good to know about the window frames.

jpkeates

I wouldn't give them a new six month contract, just let it become a periodic tenancy.

You don't have to mention the hoarding issue, but it does indicate, as you say, a potential issue going forward.

There's a sticky thread in this forum with a link to a checklist relating to serving notice. It's worth while having a look at that so you can be sure a notice that you serve will be valid, in case there are issues ahead. Given you recognise that you are not an experienced landlord, should you need to serve notice, I would use a professional eviction company to do that, rather than trying to do it yourself.

rosabug

@jpkeates

thanks for the reply. I guess the thing about a rolling tenancy is that it creates an uncertain situation for the tenant, where as if I give long notice with an absolute deadline of 6 months, end of contract, it will give them a definite framework and plenty of time to acclimatise to leaving. I am worried about them becoming fearful - then awkward.

but thanks for the advice about a professional eviction company - I didn't know there was such a thing.

jpkeates

Quote from: rosabug on August 11, 2024, 02:04:07 PMI guess the thing about a rolling tenancy is that it creates an uncertain situation for the tenant, where as if I give long notice with an absolute deadline of 6 months, end of contract, it will give them a definite framework and plenty of time to acclimatise to leaving.
Giving them a definite term might work and might focus their thinking.

But, just for the avoidance of doubt, residential tenancies don't really work like that and when the six months is up, nothing happens. The contract ends, but the tenancy doesn't.

The tenant doesn't really have to leave when the six months is up - I appreciate that they might believe that they do and act accordingly, but the chances of that belief persisting past the first conversation that they have about the situation are slim.

And it means that the tenant is less likely to leave sooner than the six months (and you can't serve notice soon if you want to).

rosabug

@jpkeates

Thankyou - I see what you mean. My thinking was to give them say a 4 month warning but at the same time also inform them I would be making it formal at the 2 month point. so polite warning in March, section 21 in April. My tenant (and her boyfriend who seems to live there, but is not on the tenancy), has told me she has various health problems - I foresee them using this to stall leaving. I do actually think 2 months is a short period of time to find and move home. But I do also see that the clear line and swiftness of the formal way may be better. But I also think I it might be wise to be mindful of her condition?