Legal Question in Landlord & Tenant Law in California

Whether you owe any rent depends upon how you worded the transaction. If it was "since you intend to buy the house I will not chare you any rent" and you made a reasonable offer to the bank that demonstrated a good faith effort to actually buy the house, then you do not owe rent. If it was "since you will be buying the house I will not charge you rent for the period of time from now until you do buy the house", then because you did not buy the house you owe him rent. I suspect you did not put the terms in writing and each one of you will come up with a different version of what the agreement was. But I donot know which wil sound more reasonable, but you have the big problem of why would he let you live there rent free and also upset the bank by turning it into a rental [they charge a higher interest rate for rentals]. You did get the advantage of living there free, so unless you can show a clear understanding by both of you that there would be no rent,you should offer to settle by paying some rent.

not proof read