If you’re thinking about selling your house, but currently have tenants renting it out, you may well be confused about where to start.
Give Your Tenant First Refusal
Before trying to sell on the open market, give the tenant first option to buy, as this will enhance the feeling of goodwill during the sale process.
The last thing any seller wants is a tenant who feels that they are being forced from their home.
It is also a good idea to keep the tenant informed throughout the sale process, and offer them incentives e.g. reduced rent while the home is being sold, as you will need their cooperation to sell successfully.
You may grant tenants the right to stay in the property while it is being sold, thus giving them time to find another residence.
You could also discuss with the tenant the possibility of selling the property to another investor, from whom they may continue to rent the home.
When trying to sell a house occupied by a tenant there are many potential pitfalls so obtaining advice, especially legal, will be of benefit. Do not cause yourself unnecessary trouble by breaching any clauses within the existing tenancy agreement.
How To Be A Responsible Landlord
Be a good landlord ! Potential avenues of good advice include Residential Landlords Association, local Letting Agents, Solicitors and the Citizens Advice Bureau.
Problems you may encounter:
When selling a tenanted property, you must first evaluate what type of tenancy agreement is in place, as well as any agreements with any property management company.
It is important to think ahead when first renting the property, and get potential renters to sign some form of fair and legal tenancy agreement. It is easier to facilitate a quick house sale if tenants are under an Assured Shorthold Tenancy Agreement lasting for a limited time i.e. 6 months.
If you have sitting tenants whom are long term tenants renting with no tenancy agreement; it may discourage potential investors from buying the property. Trying to evict sitting tenants can be a drawn out and expensive process, taking up to 5 months.
Tenanted homes often do not sell for as much as vacant properties, house sellers can be limited to selling to buy to let homebuyers, and tenants may be uncooperative, refusing to allow potential buyers to view the home. Thus it is important to have the tenants ?on your side?.
Often when trying to sell a house on the open market buyers want the home available with full vacant possession, on completion of the sale. However, there are several cash property buyers that are more than willing to buy a tenanted property. Investors even see it as a benefit if the tenant has a good track record, as they receive rent from the first day of ownership and do not have to find tenants.
A good place to sell a tenanted property is at a house auction, as many investors attend property auctions looking for buy to let opportunities, and may be willing to buy the property unseen. Another good avenue is to sell via an Estate Agent who specializes in rental property, as they may have a line on potential investors looking for such an opportunity.
If you have a tenanted property and need to sell it quickly, us.co.uk provide a fast property buying service that will even allow for your tenant to stay in the property for a maximum of 6 months.