buying a property with tenantsShould you buy a property with sitting tenants?

Have you found the perfect buy-to-let investment property in Southend but discovered it has sitting tenants? Before you consider buying property with tenants, or make an offer or walk away from the purchase, here are some points to consider. Property in Southend that’s for sale with sitting tenants, is often on the market at astonishing prices, regularly under the true market value.

If such a property does catch your eye, it is worth checking whether it’s occupied by someone with a "protected tenancy" under the Rent Act 1977 before you make an offer.

This fundamentally means the tenant – and possibly their spouse or another family member – has the right to live in the property for the rest of his or her life. Plus, they have the right to pay a "fair rent" which is usually considerably below market rates.

As a landlord, your ability to increase a protected tenant's rent is also very limited. Until recently, this often meant landlords would only buy investment properties with vacant possession for obvious reasons.

However, houses for rent in Southend are increasingly sold by one landlord and bought by another if tenancy agreements began after 27 February 1997 because this was when assured short hold tenancies became the norm. The property comes complete with tenants, who remain in the property even though the owner changes.

This can be a relatively painless way of becoming a private landlord in Southend, as long as the tenant is paying the rent, you will be receiving income from the property from the start. Check very carefully early on in the discussions what rent the tenant is paying and ask for a full copy of their rent statement and tenancy agreement. When you view the property, you will be able to see how the tenants live their life. Ask them about the property, you may find they are very happy to fill you in on repairs that you might not otherwise notice.

The deposit regulations can trip up the unwary. Ask for a copy of the deposit certificate and check that the deposit was registered within 30 days of the tenancy beginning and the money is where it was supposed to be, and that the tenant received the proscribed information. If they did not, take careful legal advice from an expert before proceeding as you can find yourself unable to evict them should you need to.

Normally, if you purchase a property that is already being rented, you will take over the fixtures, furniture and fittings, which are usually included in the property’s asking price. This means you save some initial fitting out costs. Bear in mind, however, that if the tenant leaves you may still need to bring the property up to a better standard in order to find a new good tenant.

If the tenants are keen to remain in their home after the transfer of ownership, they are probably happy, which will give you, the landlord an easier life. And after all, that’s surely want all landlords are hoping for!

1 You should still make full enquiries about any existing tenants and take legal advice before going ahead with the purchase.

We are happy to offer half an hour of face-to-face advice to local landlords in difficult situations free of charge. Please telephone and ask to speak to Martin, Marcus or Crystal.


Amy joined the firm in 2011 as an assistant property manager and has earned her place as a Senior Property Manager. She is studying for her ARLA technical award and has already taken her LLAS Accreditation exam. Amy is a very efficient and organised person who likes to resolve all property matters speedily and accurately. As Senior Property Manager, she oversees the property management department on a day to day basis, and manages more complicated procedures including court papers and evictions. She keeps her team of property managers focused and coordinated, ensuring nothing is forgotten.

Pace Property Lettings & Management Ltd
   
South Essex Landlords and Property Investor Network
   
No Selective Licensing
   
Pace Sales

 

"I am a landlady with many properties and have dealt with Pace for about 10 years. Marcus is very friendly, honest, efficient and helpful and has made my letting experience extremely easy always finding me suitable tenants. I have nothing but praise for Marcus who has been with Pace many years.

Mary R

After renovating a block of 21 flats to place into our rental portfolio we instructed PACE and gave them two weeks to let all the units on a sole agency basis. They marketed the flats for a week and conducted a strict open house event on the following Sunday for 4 hours. Within this slot 15 flats were let with the remainder let the following week.

The Director of Runwood Homes

As a landlord with multiple HMO properties, I have employed the services of PACE for a number of years now as they ensure I have my required specification of tenant placed in all my rooms. I only let rooms to employed applicants and very much favour their opening hours as this attracts and accommodates the right people.

Johnathon Simons HMO Landlord

Sara is my dedicated property manager and has been for some time. I have always found Sara to be a very professional member of staff. Sara always keeps me informed and provides regular visit reports, which is important for any landlord. Sara deals with any problem that befalls her, contacting me if she needs to. Sara will discuss any problem and invariably come to a solution.

Raymond Durrant – multi property landlord

The staff are always friendly and helpful, my special thanks to Sara, we have built a very special rapport and I feel very comfortable phoning if I need anything. I feel very happy that I have one person to deal with all of my issues.

Evelin Jenkins - Tenant

We cannot stress how much we appreciate having a dedicated property manager for our properties. We live 350 miles away and also spend a great deal of the winter out of the country. To be able to phone our manager who understands our properties and how we operate is for us complete peace of mind.

Peter and Maureen Mason – Multi property landlords

I was extremely thankful I chose PACE to conduct the sale of my property and extremely grateful to Sue Mellor who worked very hard to ensure a smooth transaction. She was most knowledgeable and professional throughout, always reachable and approachable. She was able to answer all the questions I posed.

Yvonne White

I've recently purchased a property with the help of Pace. I found the staff extremely helpful and friendly. My first contact was Katie, she showed me around the property and liaised with the vendor. After, I dealt mostly with Sue Mellor. She was very knowledgeable and helpful. She kept me informed throughout the process and was the first to congratulate me on completion.

Roni Miller

I just thought I'd drop you a line about Adele Moore who is managing my flat. Adele is doing a great job and is a credit to Pace. She has done, and continues to do, exactly what she says she will do and as a customer that is exactly what I want. Adele doesn't take things at face value and investigates things when she needs to, again a thing that clients will prize.

Tony Mihill - Landlord

Thank you to the team at PACE for firstly providing excellent property management services over many years and secondly for helping me to sell my property recently.

All your hard work has been very much appreciated. Special mentions to Sara, Amy, Sue and Billy for their friendly and professional service!

Charlotte, (Property Management & Seller)