If you're ready to sell your house with tenants in situ, it is important to fully understand the selling process. Here’s everything you need to know if you are considering selling a property with tenants:
Key things to be aware of when selling with tenants
• It is possible to sell a property with sitting tenants to a new landlord or investor.
• The marketing of your property should let potential buyers know that the tenants will remain, and once the sale is completed, they will start making their rental payments to the new buyer.
• You can also choose to terminate the tenancy and sell the property vacant.
• The amount of notice you will need to give will depend on different factors such as the terms in your tenancy agreement.
Selling with tenants checklist
Making sure you are vigilant and organised early will prepare you for your sale and speed up the process. Documents you will need include:
• Signed tenancy agreement
• Evidence of tenant’s right to rent
• Safety certificates (gas and electricity)
• Condition report including details of any repairs
• Details of deposit protection
When selling a property with tenants, you will need to transfer the tenant’s deposit to the buyer. Depending on how it is protected, you may be able to transfer it via the protection scheme used, or you may have to arrange this with the buyer directly.
Avoiding issues with tenants
You should let your tenant know as soon as possible that you are planning to sell. If possible, this conversation should be had face-to-face rather than any other form of correspondence, but you should still follow this up in writing. Explain your reasons for selling and reassure them that their rights and the tenancy agreement will remain protected.
You could offer them first refusal for selling a property with a tenant as this shows that their interests matter to you. While it’s uncommon, you may be able to achieve a smooth sale if they have saved up a deposit and are willing to buy the home from you.
Be considerate about viewings and visits and try not to cause too much disruption as tenants have the right to ‘quiet enjoyment’ of their home and this needs to be honoured.
Using an estate agent
Selling a property with a tenant through an estate agent will put you at an immediate advantage as they have access to a wide network of landlords and homebuyers and will be able to reach the right buyer for you.
Estate agents can also use their expertise in the local market to provide you with an accurate valuation, which will speed up your sale.
Most people who are interested in buying a property will use an estate agent’s search engine, meaning your property will have the best exposure.