This article explores whether there are any rules around buying a property you are currently renting. UK tenants renting from a landlord, but looking to buy, may feel that the property they already live in is perfect for their needs and feels like home – if that’s the case, can they purchase it?
There are several reasons why such an arrangement could work well for the landlord and tenant, simplifying things for both parties.
But is there anything in a tenancy agreement preventing a tenant from buying the property from their landlord?
Or in contrast, do tenants have any preferential status over other potential buyers, if a landlord is looking to sell the property? Read on to find out.
My landlord is selling the house, can I buy it?
When you’re a tenant, there’s nothing stopping you from contacting the landlord and expressing your interest in buying the property.
Of course, you’re more likely to get a positive answer from the landlord if they’re already considering selling the property. There are also a few aspects that could make you their preferred buyer, such as:
- Reliability: If you have paid your rent and bills on time and shown signs of open, responsive communication as a tenant, the landlord may feel that bodes well for a smooth sales process
- Potential chain-free status: Many tenants do not own another property and would be buying chain-free, meaning that they do not have to sell first before buying, further contributing to a smooth sales process
However, as a private tenant, you do not have any guaranteed ‘right’ over anyone else. The landlord is not obliged to give you first refusal or consider an offer from you more favourably than one from other buyers.
There is no set length of time you can rent from the landlord that automatically qualifies you to buy the property either, or secure a discount.
And if you make an offer as a tenant, but another potential buyer makes a higher one, naturally there’s a good chance the landlord will accept their offer instead of yours.
The rules are slightly different for tenants living in council or ex-council properties, covered later in this article.
Buying from a private landlord – the process
The process for buying from your landlord is similar to the purchase journey for any other. But rather than starting your journey by searching the market for available properties, instead you would ask the landlord – (via their estate agent, should they have one) – if they are considering selling.
If not, then that’s their choice and you’ll have to look for other properties. However, you could ask the landlord to let you know if they change their mind in the future.
If yes, then the process is similar to if you were buying a property from anyone else. Make a financial plan, get a mortgage agreement in principle (AIP), make an offer and then hopefully, the landlord accepts it.
Next:
- Apply for your mortgage formally
- Commission an independent surveyor
- Choose between a conveyancer and solicitor
- Exchange contracts
- Pay the deposit
- Confirm the completion date
- Pay stamp duty
And so on. For a comprehensive guide, read the Fine Living first time buyer checklist.
Benefits of buying a property from your landlord
With the landlord potentially seeing your proven reliability, potential chain-free status and so on as reasons to consider selling to you… As a buyer, what are the benefits you could enjoy by purchasing from your landlord?
There are several, particularly around the idea of ‘try before you buy’:
- If you’ve already lived in the property for a while and are happy there, then you’ve already done some ‘due diligence’ and taken some of the risk out of your purchase decision
- You’ll be familiar with the area, so it will be easy to make future plans based on criteria that can be hard to research otherwise e.g. rapport with neighbours, nearby friends, community engagement
There are also some advantages to moving from paying rent to owning the property outright:
- In contrast to paying rent, your monthly mortgage payments contribute towards the overall purchase price of the property
- Once the property is legally yours, no longer a tenant you would be free to make changes to the property as the owner
Just bear in mind that some changes may require planning permission. Find out, for example, do you need planning permission for a loft conversion?
Logistically, you’ll save on moving costs – as well as the upheaval of packing and unpacking – by buying a property you already live in.
There’s also a chance of negotiating a discount from the landlord, leveraging a good relationship, although there’s no guarantee of this.
Do the Right to Buy or Rent to Buy schemes apply?
Some reading this article may be wondering if, as a tenant, there is a ‘right to buy’ from a private landlord in the UK.
While there is a Right to Buy scheme, this is for tenants applying to buy a council home. Criteria for Right to Buy this includes renting from a public sector landlord for three years.
Potential discounts include 35% or more on council houses and 50% or higher for flats, up to 70% or more likely, the maximum available discount in the region (that’s £16,000 in most of London). These regional maximums were higher between 2012-24 but the government lowered them in the 2024 Autumn Budget.
There is also ‘Preserved Right to Buy’ for homes that a council used to own, but sold to another landlord or housing association while a tenant was living there. There is also a Right to Acquire initiative for housing association properties.
Is there a ‘Right to Buy from Private Landlord’ scheme?
Several years ago, there was some speculation about a Right to Buy policy for private accommodation:
At the time of writing, unlike the Rent to Buy scheme for council properties, there is no equivalent for the private sector giving tenants preference or a discount.
What is Rent to Buy?
While there is a Rent to Buy scheme in the UK, helping tenants to save for a deposit and offering some properties at a discount, it is not available in London.
But there is a London Living Rent programme to help tenants buy certain properties through shared ownership.
Final thoughts: Buying a property you are currently renting (UK)
In summary, tenants can buy properties from private landlords while living there and there can be some advantages for both parties.
However, they can only do this if the landlord a) wants to sell the property and b) chooses to sell it to the tenant in question, rather than another buyer.
I hope you have found this article useful and informative. For other articles, take a look at the Fine Living blog.
Recent articles include:
Here at Fine Living, there’s a wide range of beautiful London properties available to buy or rent – browse our portfolio for more details!
And if you have any queries or would like to get in touch, please don’t hesitate to contact me.
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