When thinking of selling a property with tenants in situ, there are a number of considerations:

1. The tenant has the right of “quiet enjoyment”

Unless it specifically states in the tenancy agreement that the tenant has to allow viewings, then they have a right to refuse them. They may have legitimate reasons, such as being shift workers, having a new baby, or suffering from a personal crisis such as bereavement, and do not wish to be disturbed.

Your relationship with them as a landlord will have a huge bearing as to how accommodating they are to viewings.

If tenants do agree to them, you should give them 24 hours notice in writing - via email or text - and get their permission.

The lack of flexibility over viewings may cause problems for potential buyers who may want to view in the evenings or at weekends or with little notice.

2. A tenanted property does not “show” well.

When a tenant is living in your rental property, they have a right to live there as they choose, as long as they are adhering to the tenancy agreement, and are not causing any nuisance, damage, fire, or health and safety risk.

Therefore tenanted properties may be full of the tenant’s possessions and may not be cleaned to the standard to show the property in its best light. Beds may be un-made, washing up in the sink, etc. They may even have a pet that can be off-putting to potential buyers, and make smells.

There is not a great deal you can do about this, and your potential buyers may find it hard to see the property’s true potential through all the tenant’s possessions and living habits.

3. Tenants can put off potential buyers

If a tenant is happy in their home, they not wish to move. We have known tenants to mention noisy neighbours or crime in the area, just to put off buyers! They can be quite disruptive to the sales process in this regard, often cancelling viewings at the last minute or not giving the prospective buyer a good impression of the property or the area.

4. Whether to sell with tenants in situ or to sell with vacant possession on completion

You may choose to sell to another landlord, who will take over the tenancy, or you may choose to sell with vacant possession.

If choosing to sell to another landlord, they will want to know the actual rent being achieved. If your tenants are long term, they may well be on a below market rent, and this affect the offer the LandlordBuyer may be willing to make i.e. they may use it to make a lower offer because the rental yield is below average.

Selling with vacant possession means that you will have to ensure that the tenancy is terminated and the tenants have moved out before the sale can be completed.

It is worth noting that it can take considerable time to achieve vacant possession, especially if the tenant proves to be reluctant to leave.

Agreeing a fixed completion date before the tenant has actually left the property can create issues if the tenant is still in occupation on the agreed completion date. The buyer will be entitled to delay completion, and might be able to terminate the contract and sue for damages.

This will mean you are right back to square one with trying to sell the property, and it may even be void for a considerable period.

Our M.D. Jason Harris has some thoughts on this topic:

At LandlordBuyer, we will buy any property in any condition in England and Wales. We consider any type of tenancy, including AST and sitting tenants, and we will buy with your existing tenants in situ, meaning you have no worries of serving notice, voids, and viewings.

We are professional property buyers and have a significant cash fund, meaning we could buy your tenanted property in as little as 7 days.

Please get in touch for a no-obligation quotation.

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