ᐅ Buying a house when the seller requires a right of residence – How to handle it?
Created on: 23 Oct 2018 12:48
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NeueWeltHello,
As you may have seen in my other thread, my partner and I had very bad luck with the real estate agent/seller during our last attempt to buy a house.
Now we have another house in mind.
Nothing is set in stone yet; we just want to gather some information in advance.
It is important to us to have a fair and smooth process for both parties.
The situation:
The seller wants to sell his house because he is building a new one. The new build will be finished in summer 2019, so he wants to stay in the house with his family until then. However, the money from the sale is needed now (payment of the purchase price next year is therefore not an option).
There are definitely different possibilities. I am open to all ideas. Currently, I have the following concept:
We buy the house and register a right of residence for the seller until next year.
He would pay us a rent equivalent to our loan installments (interest + principal repayment).
We would prefer to avoid paying double costs from our regular rent and loan interest and/or principal repayment over so many months.
Does this approach make sense?
Maybe we can negotiate with the bank to start the principal repayment only next year. That way, only interest would be due, and the seller’s monthly burden would not be too high either.
Of course, this means the repayment period would be somewhat longer in the end, but we would be okay with that because the house is really great.
What do you think about this, or is there another option?
Thank you very much!
As you may have seen in my other thread, my partner and I had very bad luck with the real estate agent/seller during our last attempt to buy a house.
Now we have another house in mind.
Nothing is set in stone yet; we just want to gather some information in advance.
It is important to us to have a fair and smooth process for both parties.
The situation:
The seller wants to sell his house because he is building a new one. The new build will be finished in summer 2019, so he wants to stay in the house with his family until then. However, the money from the sale is needed now (payment of the purchase price next year is therefore not an option).
There are definitely different possibilities. I am open to all ideas. Currently, I have the following concept:
We buy the house and register a right of residence for the seller until next year.
He would pay us a rent equivalent to our loan installments (interest + principal repayment).
We would prefer to avoid paying double costs from our regular rent and loan interest and/or principal repayment over so many months.
Does this approach make sense?
Maybe we can negotiate with the bank to start the principal repayment only next year. That way, only interest would be due, and the seller’s monthly burden would not be too high either.
Of course, this means the repayment period would be somewhat longer in the end, but we would be okay with that because the house is really great.
What do you think about this, or is there another option?
Thank you very much!
So, a registered right of residence is always quite a drawback! I would rather consider a fixed-term rental agreement; how to best arrange this is probably something the notary can advise on. It should also be possible to include this in the purchase contract, so if both parties agree, I think there are better options than a right of residence. Of course, the whole matter always comes with some complications—what if the new house isn’t completed on time, for example?
It’s a bit of effort, but everything can be arranged….
What’s the situation? Are there 100 interested buyers lined up?
If not, the seller should take the risk… their bank can always provide a bridging loan, that’s what my parents did… they sold their old house, so ownership transferred immediately to the new owner… the money was then used for the loan on the new house, and they paid the local market rent in the meantime… no one gives anything away for free, just because you pay low interest doesn’t mean you have to pass it all on to the seller….
It’s a different situation if multiple people want the house, then you have to make more concessions…..
I wouldn’t register a right of residence, too risky, better if they just pay rent….
What’s the situation? Are there 100 interested buyers lined up?
If not, the seller should take the risk… their bank can always provide a bridging loan, that’s what my parents did… they sold their old house, so ownership transferred immediately to the new owner… the money was then used for the loan on the new house, and they paid the local market rent in the meantime… no one gives anything away for free, just because you pay low interest doesn’t mean you have to pass it all on to the seller….
It’s a different situation if multiple people want the house, then you have to make more concessions…..
I wouldn’t register a right of residence, too risky, better if they just pay rent….
Snowy36 schrieb:
It’s a bit of effort, but everything can be arranged....
What’s the situation like? Are there 100 interested buyers?
If not, then the seller should bear the risk... their bank can always provide a bridge loan, that’s what my parents did... they sold their old house and ownership transferred immediately to the new owner... the money was used for the new home loan, and they paid the usual local rent meanwhile... no one is giving anything away; just because you have low interest rates doesn’t mean you have to pass everything on to your seller...
It’s different if multiple people want the house; then you have to make more concessions...
I wouldn’t register a right of residence, too risky; better that the seller pays rent...As is currently common, we are by far not the only interested buyers. Ownership should transfer directly to us, and the usual local rent would naturally have to cover at least our loan costs.
Nordlys schrieb:
No. Different. Let’s say the price is 250,000. Twelve months right of residence equals 14,000. So the price with right of residence is 236,000. That reduces property transfer tax and notary fees. KarstenClearly this would save us property transfer tax, but we would still have to pay rent for the residence during those 12 months and the loan. We want to avoid that. Or I misunderstood you.
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