advice needed: sellers who want to stay past closing

[Elizabeth Nenque]

My husband and I have been house hunting and are about to submit an offer on a house in Bothell.
The sellers would like to stay past closing and rent until they find a house. Our agent says this is common. BUT we received advice from another RE agent that we shouldn't allow this, because of the liability.
Our agent had suggested that the sellers need the proceeds to begin their house hunting (they want a bigger house), but a closing contingency makes them less competitive in this market. 
Tomorrow at 1 pm, (Friday Dec 30) we will meet with our agents for a strategy meeting. They say that sellers request to stay past closing is common. But that doesn't make me feel assured.
Additionally, they need to repair the roof before we close. A previous set of buyers backed out of closing when the sellers could not repair the roof on their own.  They were willing to use the proceeds of the sake to repair the roof. 
However, their agent says that now they have a roofer that will do the work and will wait to get paid on closing with the funds from the sale. So this may not be a concern.
What advice would you offer us? What should we bring up with our agent in our strategy meeting? Should we offer lesson the sale price AND charge for rent?  what would you cosnider in the contract?
Other considerations: This is a sellers market. Once the holidays are officially over more buyers may come into the market.  The area and home are desiresble, but the sellers request, I think have kept the house on the market limber than normal.  The house had been on the market for almost 1 month.

[Carley M.]

I've done a sale with a rent-back before.

You should handle the roof situation completely separately. Make sure it is fixed and inspected prior to close.

When you set up the rent-back (if it doesn't inconvenience your family situation), make sure that the sellers obtain renters insurance, require that they list you as an additional insured, and put in a time limit for the rent back.  If they've been waiting to find a place, they can start looking as soon as you sign the contract and they can make their purchase offer without a contingency since the property will be sold to you before they close. Give them 30 days post closing and then charge them a significant per-day rate for each day past the 30 that they stay in the property.  Otherwise, you could be waiting to move in for 6 months or a year. I started looking in January, found a place in April, signed a contract in May, but didn't close until November. While that is certainly not a typical timeline (this is my 8th home purchase experience), you need to protect yourself from the worse case scenario.  Also, price the rent-back to cover all the costs of them in the home, not just the mortgage payment. I also asked for a security deposit to be held in escrow to make sure that when they moved out, there wasn't damage to the property. That might help the sellers decide that it would be a cheaper option for them to move into temporary housing while they search for a new place.

A rent-back is not ideal and if you can avoid it, you should. That said, I jumped through a lot of hoops to get my most recent property because I knew it was the right financial decision and would be worth it in the long run.

Good luck to you!