Reply to How common are rent backs in this market?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous]We are building our home and it won’t be ready until July.  We’d like to try to sell now and have a couple months rent back.

Our realtor has told us about 5-6 month rent backs.  But this was last year and wasn’t sure if it was still a thing.

We’d probably be looking for a 2-3 month rent back.

What’s the general limit of rent backs and are buyers pretty amenable in this market?[/quote]

Why would anyone who is trying to buy a house (presumably to live in) agree to let a stranger live in their house for 5-6 months? It's not like this is a great buyer's market -- this is the worst buyers' market in decades. So if you aren't going to actually provide housing to them, what's in it for them? If they waited to buy your house in 6 months, chances are the price will be much, much lower. Your agent is either delusional or purposefully misleading you to try and get you to sell at the peak so their commission will be higher. Your agent is probably hoping that once an offer is in hand, you'll agree to a shorter rent back. If that's not what you want then you need to wait to list it.

Selling a property means you are ready (or very close to ready) to vacate. Selling means transferring the right of possession (ie occupation) to another party. Do you want to do that? Then do that. If not, then you are not ready to sell. I get that you want to cash in before the market begins to unravel, but your choices are either sell now and move into a rental for 6 months, or sell later and risk missing out of the market peak. There is no third option of sell now but continue to live there for half a year at buyer's expense. That's obviously insane.

The reason that lenders don't allow this is because once the contract for sale is signed the buyer is responsible for any loss to the value of the house (it's called equitable conversion). So in a rent-back situation, the buyer is responsible for loss (ie damage) but not in control of how the house is cared for because the buyer isn't in possession. Most people underwriting or insuring the transaction are not willing to tolerate this situation for more than 60 days. [/quote]

^ this exactly. If you need 2+ months of rent back, then you are not ready to sell your house.[/quote]

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