OT: Decided to sell house that's currently occupied

[Steve]

We inherited my parent's old house when they died and we've been letting it out through Countrywide Letting Agency for the last seven years. The current tenancy agreement comes to an end in July and we've decided to sell the house and use the money to pay off our own mortgage.

It's a 140 year-old mid-terrace house and being an old building it's getting harder to maintain (for me, anyway).

What's best - sell with 'sitting tenants' or give the tenants notice that they'll have to move out at the end of the current agreement and sell an empty house?

[Scion]

Steve put finger to keyboard:

Empty house. No contest.

Assuming that there are two major types of buyer - those buying somewhere to live, and those buying to let.

The first type aren't going to want tenants.

The second type are going to plan on getting their own tenants anyway, perhaps after decorating/maintaining etc.

Trying to sell with sitting tenants is going to reduce interest in the property by (finger in air) 80%?

The only caveat is if you feel any loyalty towards the tenants - perhaps it's been their home for all those seven years - in which case there's nothing to stop you putting it on the market with sitting tenants as long as you're prepared to wait for a sale. Of course the plus side of this is that you'll have an income while the property is on the market. But if you really want to sell, and sell soon, then give them notice.

[Lobster]

On 05 Feb 2014, Steve grunted:

Almost certainly, get rid of the existing tenants first. Unless you are specifically going to be targeting another landlord who will probably be pleased to take on the place with tenants already in place, the presence of tenants will be a putter-off for any prospective purchasers. They are likely to perceive them as a problem - ie, will they move out happily and on time before exchange of contracts, or might they decide to play the long game and wait for eviction by the courts, which could add months to obtaining vacant possession (and it happens all the time).

Also, if the property is empty you will have the chance to make sure it's spick and span for viewings, and any necessary diy work gets done etc.

Furthermore, eg if the tenants are not overjoyed about being moved out, they are perfectly within their rights to block and viewings, which would be frustrating...

The downside is that you lose any rent income after the tenants have left; but frankly that's a having-your-cake-and-eating-it situation.

[Davey]

Is there any chance that the current tenants would be interested in getting their own mortgage and buying the place from you? We did this once.

[Steve]

Steve was thinking very hard :

Thanks guys. I did expect that answer but just wanted to be sure we weren't missing something ;o)

[Steve]

Davey pretended :

Don't think so Davey but we'll put it to them.

[tony sayer]

In article , Steve scribeth thus

If it were me I'd stick the rent up .. well:)...

And dump the lettings agency and DIY that!...

[Adrian]

If it's going to sell to a BtL landlord, then the sale price is going to be viewed purely in terms of the simple rental yield. If that's less than

5-6%, it's overpriced for the BtL market.

Some BtL buyers will be very happy with long-term sitting tenants. Others won't. NOBODY but a BtL buyer will be remotely interested without vacant possession at exchange.

[djc]

Sell empty. If you think it may be on the market for a while then you could let them stay on a 2 month notice, to be given when you get a sale.

>

[Nick Odell]

I strongly suggest you don't use the term "sitting tenants" in conversation or otherwise - even in quote marks or even in fun. The common understanding of a sitting tenant is of someone with an unlimited right to remain who pays only about three-farthings a year in rent and if your tenants are simply on an assured shorthold or statutory periodic tenancy - as I am sure they are - you don't want to plant any adverse ideas into anybody's mind.

Nick

[jgh]

When I bought my property the fact that it already had tenants was a bonus which tipped the deal into feasability - it removed the hassle of tracking down tenants myself, and leaving me without an income to pay the mortgage.

jgh

[Adrian]

Strangely, I've just seen details of a place for auction around here that comes with tenants on a "regulated tenancy". Eeek. Thanks, no thanks...

[Scion]

jgh put finger to keyboard:

Did you not feel there was any risk that the seller was getting rid

*because* of the current tenants being a pain?

[Adrian]

Probably because it would be one heck of a lot easier and cheaper to just terminate the tenancy...

[meow2222]

Few potential buyers + problem tenancy = potential bargain, IF you can deal with the difficult situation. Most LLs can't.

NT