First home buyers with tenants in property

Ash12 · Feb 03, 2021 6:35 pm

Hi,

This is my first time posting here. I'd appreciate any advice 😊

Our offer has just been accepted on a tenanted property. By the time it settles they will have 6 months left on the lease. We are fine with this and will move in after they vacate.
My question is about our loan. Can we still have a normal home loan? We aren't purchasing this as an investment property unfortunately we just can't move in because of the tenants.
Help!?!

Thank you 😌

aussieta · Feb 03, 2021 7:50 pm

yes you can just move in, sale of home is grounds to break lease, just give 1 month notice

Ash12 · Feb 03, 2021 9:05 pm

aussieta

yes you can just move in, sale of home is grounds to break lease, just give 1 month notice

No, we must honour the original lease as the agreement was for a fixed term.

chippy · Feb 03, 2021 9:08 pm

aussieta

yes you can just move in, sale of home is grounds to break lease, just give 1 month notice

Actually it's not. A fixed term lease is exactly that, regardless of the sale of a property.
Tenants may be happy to negotiate a termination of the lease but are also legally protected from being evicted unless they break the lease.

chippy · Feb 03, 2021 9:20 pm

You should be fine with a standard home loan.
Maybe speak with your mortgage broker or bank.
Depending on how long you own the house there could be some capital gain implications if you don't stay in it long.

Althom · Feb 04, 2021 9:39 am

You might also find that under COVID conditions that leases cannot be terminated unless the tenant is being very naughty.

SaveH2O · Feb 04, 2021 10:57 am

For peace of mind, have a look at landlord insurance.