Owning a property that you rent out seems like a great idea and a good source for additional income, however you can run into an issue if you ever want to sell the property. As opposed to selling your own home selling a house fast that has sitting tenants can be a bit trickier as you have several legal hoops you need to jump through.

Firstly, can you actually sell a house with sitting tenants?

In short yes you can. It’s called the buy to let market, and it's something The Property Buying Company can help you with.

With all the changes around landlords, especially with the abolition of section 21, a lot of landlords are now choosing to offload some of their property portfolio.

Selling a house with sitting tenants makes the process a bit different to normal, and it has a different set of pros & cons than a traditional sale. Here is a breakdown of things to think about when selling with sitting tenants:

  • It’ll cost you less as the property won’t be empty at any time during the sale

  • It can be a great selling point to fellow landlords if your tenants are paying an acceptable rental pcm

  • The new owner is guaranteed income from the start

  • Transferring the tenants deposit can be tricky, depending on the scheme used

  • You could annoy the tenant if you book too many viewings during the sale

If this doesn’t sound like an option that would work for you then your other option is to evict the tenants that are in place before going on the opening market. This involves using Section 8 but the tenant would have to breach the tenancy agreement and it can cost several thousands of pounds to go down this route & your final option is to of course wait out the tenancy agreement.

Sitting tenants? We may be able to help

The legal side of selling a property with sitting tenants

When you have a tenancy agreement this is often referred to as an AST or Assured Short Hold Tenancy Agreement, this is mostly to protect the tenant and it determines the length of time that they can stay at the property without eviction, as long as they don’t breach anything the agreement.

As a landlord you should always make sure in this legally binding document you have a stipulation around the sale of the property and the tenant allowing viewings.

If you have a good relationship with the tenant it may not be necessary to rely on this agreement, however if you don’t then it can be more than useful. Failing to include a clause like this in the agreement will leave the ball in their court as to whether they allow you to arrange viewings or not.

How do I sell a house with sitting tenants?

It’s almost the same as a regular vacant property sale, you can sell on the open market using normal methods such as an estate agent, however you need to obviously make potential buyers aware that the property has tenants in situ.

The only thing that is different is that you will need to transfer the rental documents to the buyer’s solicitors prior to the completion.

Once the new landlord has bought the property, they don’t possess any extra rights and nothing should really change from the perspective of the tenant.

The new landlord may want to get you to sign a new up to date tenancy agreement, but the tenant can refuse to do this.

How to avoid difficulties when selling with sitting tenants

The best way to avoid any hiccups when you want to sell your house with tenants is essentially to have a good landlord-tenant relationship. This will make the whole process a lot easier, and mean no disruption for the landlord or tenants.

Mathew McCorry

If you read my property blog now, that'll be the end of it. I will not look for you, I will not pursue you. But if you don't, I will look for you, I will find you and I will make you read it.