How to Sell a Property with a Tenant in Place

Share on facebook
Share on Twitter
Share on Google+

If you’re a landlord selling a house that currently has tenants in, then this can be quite a lot of hassle. There are many rules and regulations that you need to abide by before putting the house on the market.

Here are just a few things to consider when selling a property that has tenants living there:

Property Viewings

Dig out your original tenancy agreement as this should have the information needed regarding property viewings, and the notice that you need to give the current tenants to arrange a viewing. Ideally, this should be at least 24 hours so that the current tenants have time to clean or, if wanted, vacate the house.

If you did not include this in the original agreement, then you have no rights to allow potential buyers to view the house beforehand, which will make the sell harder.

Evicting a Tenant

Just because you are the rightful owner of the property doesn’t mean that you are able to evict the tenants just to sell to another buyer. The first option that you have is to serve notice on your tenants to vacate the property once the tenancy period comes to an end. This will give them time to look for a new home.

If your tenancy agreement is an AST (assured shorthold tenancy) agreement, at least two months’ notice needs to be given in order to end the current tenancy, and this can be done through a ‘Section 21’ notice. You will need to check the original terms of the contract to check out the first opportunity for serving notice as some ASTs will protect the tenants for the first six months. A Section 21 notice does not require you to give a reason as to why you’re evicting a tenant.

Another option would be to sell the property to another landlord, so that the current tenants can stay put. The good thing about this is that it might make the sell a little easier, as the landlords won’t need to spend time hunting for new tenants.

What Happens Once the Property is Sold?

If you have sold the property to another landlord, and the tenants are staying put, then they have no right to evict the current tenants without following the correct process. The only difference on the tenancy agreement will be the name of the landlord.

For this reason, it is a good idea to have a new agreement signed as soon as possible, if the new owner wants the tenant to remain. They should also write a formal letter to the current tenants to explain that they are the new landlord and how the rent payments should be altered.

The new owner must also contact the Deposit Protection Service so you can transfer the deposit. Tenancy protection is mandatory in both England and Wales, and has been since 2007, so failing to protect a tenant’s deposit by transference could result in some serious fines and penalties.

Share on facebook
Share on Twitter
Share on Google+

Subscribe To Our Newsletter