Opportunity For Tenants Buying From Landlords in Leicester

Open & Honest Mortgage Advice in Leicester

We frequently receive inquiries from private tenants who are considering buying the property they currently rent from their landlords. This interest often stems from landlords extending the courtesy of first refusal, granting tenants the opportunity to purchase before the property hits the open market.

Even if this privilege isn’t initially offered, it’s worth exploring with your landlord whether they’d be open to such an arrangement in the event of a sale.

Recent governmental changes have tightened tax relief previously accessible on buy to let mortgages in Leicester. Implemented over a four-year period, these alterations are now manifesting in landlords’ tax bills, marking a significant shift in the landscape.

Property ownership has traditionally offered landlords a steady income stream and a promising investment avenue. While some landlords have weathered the tax adjustments, viewing property ownership as a long-term commitment, others have opted to divest.

Selling the property to existing tenants presents several advantages, driving many landlords to choose this path. Here are a few key benefits:

Advantages to Tenants Buying From Landlords in Leicester

• Evading Estate Agent Fees: The average national estate agent fee stands at 1.8% + VAT, translating to substantial savings for landlords who bypass this expense by selling directly to their tenants.
• Mitigating Loss of Rent: Selling a property with a tenant in situ can prove challenging, as tenants are generally disinclined to facilitate viewings on behalf of their landlords. This reluctance can result in tenants vacating the premises, leading to a rental void and loss of income. Selling to the tenant ensures a steady rental income until completion.
• Minimising Refurbishment Costs: Tenant turnover often necessitates property refurbishment, ranging from cosmetic touch-ups to more extensive renovations. Selling to a tenant eliminates the need for additional refurbishment, as the property is already to the tenant’s liking.

From the perspective of tenants purchasing from landlords, several advantages emerge:

• Familiarity With The Property: As current occupants, tenants are intimately acquainted with the property and its potential improvement areas.
• Streamlined Sale Process: With no property chain involved, the transaction is less susceptible to delays or collapses.
• Potential Discounts: Landlords may offer tenants a discount from the market value, reflecting the savings accrued from avoiding intermediary costs.

These factors collectively make purchasing the rented property an appealing prospect for tenants, fostering a mutually beneficial arrangement for both parties involved.

Date Last Edited: February 9, 2024