Is selling a house permissible in Islamic law if the sale includes the seller's free residence in it for one year after the buyer has paid the full price?

It is permissible to sell a house while reserving the right to benefit from it for a known period, such as residing in it for a year. This is the view of the Maliki and Hanbali schools of thought. They base their argument on the hadith (definition) of Jabir (may Allah be pleased with him), "that he sold a camel to the Prophet (peace be upon him) on the condition of riding it back to Madinah," and on the general texts that command fulfilling contracts and conditions, as long as they do not permit something forbidden or forbid something permissible.

As for the Hanafis and Shafi'is, they believe that delaying the delivery of the asset is not valid, citing the prohibition of a sale with a condition.

If the buyer becomes insolvent or delays payment, the seller is permitted to annul the contract.

Accordingly, if the first contract is canceled and a new installment contract is drawn up, with the period of free residence beginning after the price is paid in full, then there is no harm in that.