Sale and Rent Back our loved property?

Sale and Rent Back our loved property?

13:52 PM, 13th February 2017, About 5 years ago 13

Text Size

Last year we had put our house on the market (detached bungalow, Torbay/Devon, 2 bedrooms, open plan with sea view and large new conservatory) to release equity for funding our business. Originally we intended selling the house and moving somewhere else, but since we couldn’t find a suitable and affordable alternative nearby, we now strongly consider staying!sale and rent back

We are fully aware of the problems associated with “Sale and Rent Back”. We learned that apart from private buyers only very few regulated firms are active, and that we will get less money for the house than by a normal sale, but this may still be the best option for us – if we would get a sincere and reasonable offer.

Since, as mentioned, an important reason for selling our house is releasing equity for our business, we can’t afford losing too much by the sale. From internet forums we’ve learned that often 85% are paid on SRB, and sometimes more according to the status of the property. In our case, the property has been completely renovated recently (we invested about £42,000 during the last few years), so no further investments or works are required.

Do you possibly know what they can and cannot do regarding SRB (e.g. Assured Tenancy with fixed term, option of repurchase at a later point in time…)? Or how could we find such buyers?

We will be ideal tenants and keep everything in good order and condition. As mentioned above, we invested a lot of money in the house and love the outcome very much.

Many thanks!

Rain



Comments

by Rain S.

22:00 PM, 14th February 2017, About 5 years ago

Reply to the comment left by "Puzzler " at "14/02/2017 - 19:57":

Hi, you wrote:

> You will find solicitors won’t touch them either

Do you mean we wouldn't find a solicitor who would handle a SRB agreement?

by Dave Driver

0:04 AM, 15th February 2017, About 5 years ago

There are a lot more documents on the FCA pages if you search for "sale and rent back". None of it is particularly clear or readable except perhaps if you are a lawyer. I wasn't able to find the part about 5 year tenancies, it's probably there if you look hard enough.

I remember attending a presentation by National Homebuyers shortly after the full regulations took effect. They were one of the few approved firms. I remember them saying how involved and detailed the training was that they had had to take. The rules are very detailed and prescriptive. I don't think they are operating SARB now.

I don't know what the rules are about renting a property to a previous owner, but I imagine there might be a difference between doing this several years down the line and immediately after purchase.

I am pretty sure that there is no exception for private individuals or one-off cases, all would be counted as SARB providers, and without being trained and authorised by the FCA, such a transaction would be unlawful.

by Rain S.

12:39 PM, 15th February 2017, About 4 years ago

Reply to the comment left by "Dave Driver" at "15/02/2017 - 00:04":

Hi Dave,
I found it on https://www.handbook.fca.org.uk/handbook/MCOB/2/6A.html => MCOB 2.6A.5B [R] 26/04/2014 => "(i) if the property is in England and Wales, as an assured tenancy (including an assured shorthold tenancy) under the Housing Act 1988 (as amended); [...] (b) the tenancy is for a fixed term of no less than five years;"

Isn't it a bit strange that not all SRB regulations are in ONE document?

And what does this mean:

"as an assured tenancy (including an assured shorthold tenancy)"

I know what an assured tenancy is, and I know what an AST is, but how can an Assured Tenency "include" an AST?


Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

BECOME A MEMBER