Sale and Rent-back Factsheet
What is Sale and Rent-back?
It is when a vendor of a property sells their property to a property investor. Coincident with the completion of the sale, the vendor signs a tenancy agreement to rent the property back from the purchaser.
What is the benefit of doing a Sale and rent-back for the seller?
The benefits are clear. A person is able to sell their home but does not have to move out. This means that a person does not incur any of the typical moving costs or the hassles associated with renting another property. A vendor doesn’t have to go through the pains of finding another property, changing address and the back strain of moving endless boxes. Your home remains your home – you simply no longer own it.
Why do people do it?
People do for many different reasons.
Some people choose to do it because they just no longer want the financial burden of a mortgage, others because they are unsure of their circumstances and might need to move abroad or location but are unsure of the timing involved. However, the most common reasons are financial difficulty due loss of job or over-stretching themselves with a mortgage. Some people are simply taking a view on the housing market.
Who can I do it?
Almost any homeowner can do it.
What is the benefit of doing a Sale and rent-back for the property investor?
Buying a sale and rent-back has obvious advantages for an investor. The main advantages are: a tenant from day 1 so no voids, higher likelihood that the tenants will remain long term and that the tenant will treat the property with more respect (so less maintenance costs).
How do I determine the value of my property?
The approximate value of the property can be easily researched through looking for comparable properties in the area. Comparable properties can be found either by looking in local newspapers, estate agents windows, talking with estate agents or looking on property websites.
Alternatively, you can ask an estate agent to come and value your property. Most estate agents will do this free of charge, keen that they will get your business after doing this. It is often advisable to get more than one valuation because it can range from agent to agent.
How do I determine the rent on my property?
Again comparisons can be found by looking in local newspapers, through lettings agents, looking on rental websites or talking to friends.
How do I sell properties through Landlord Trader?
First you must register details in the “My Account” section.
After the details have been registered you will receive email confirmation of your password and details.
At this point you will be able to enter the details of the property that you wish to sell. The “Add Property” within the “Sell Properties” section will guide you though the process for uploading the details, but should you have any problems, please don’t hesitate to contact Landlord Trader directly.
Landlord Trader will email you when offers are made and you will be able to track the offers through your personal account.
Please note that this factsheet should not be seen as advice. Potential vendors should speak with a solicitor if unsure of their legal situation.
