Selling a tenanted buy-to-let property
Sponsored feature | Kate O’Riordan, solicitor, HCR Hewitsons
If you are planning to sell a tenanted buy-to-let property, a key decision will be whether to sell with or without the tenant in occupation.
Thinking early on about the types of buyers you are targeting will help you decide how to proceed. Tenanted properties are often an attractive option for investment buyers who won’t need to worry about searching for a good tenant and will benefit from an immediate rental income when the sale completes. By contrast, an empty property will generally have a broader appeal.
Whichever route you’re taking, talk to your tenant early on; the more informed they are about your plans the more cooperative they are likely to be.
Once you have found a buyer, if they are willing to take on the ongoing tenancy the sale will proceed in the usual way and the buyer will take over the role of landlord when the sale completes. If the buyer is not willing to take on the tenancy you will need to serve notice on your tenant so the property is vacant for completion.
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When should you serve notice?
Most tenants will require at least two months’ notice but you must check the terms of the tenancy agreement carefully to ensure that you serve the correct amount of notice.
You may be tempted to serve notice immediately upon finding a buyer but this can be risky. Remember, until contracts have exchanged the sale is not legally binding and the buyer can walk away at any time without consequence. If you serve notice before exchanging contracts and the sale does not proceed, you may well be left with an empty property and without rental income to cover mortgage costs while you look for a new buyer.
When notice will be served is something that can be negotiated between the solicitors on your behalf. Some buyers might insist on waiting for a vacant property before exchanging contracts, others may be happy to exchange based on confirmation that notice has already been or will be served.
Your solicitor will be able to advise you on how to proceed in a way that best suits your circumstances and goals.
For more information, contact Kate O’Riordan, solicitor, Real Estate team, on 01223 447421 or koriordan@hcrlaw.com.
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