Let’s face it – it’s rarely good news for a tenant to hear their landlord is selling up. A person who rents their home is always aware that somebody else owns it, but it can still be a shock when you’re told you might not be able to live there any more.
First things first, you have to tell them you are planning to sell the flat. Best to do this in writing as well as in person – make sure the message has been received and understood.
If you have a good, long-term tenant living in the flat, you could offer them the chance to buy. It shows you’re keen to allow them to carry on living there and could see a quick sale for you.
If that doesn’t happen, you’ll be putting the house on the market. Communicate everything clearly to your tenant, including any visits that need to take place for surveys, valuations and viewings. Assure your tenant that you will give them an appropriate amount of notice ahead of any visits – this should be at least 24 hours, but we’d recommend giving them a few days at least.
Ideally, another landlord will buy the flat. If your tenant is in the middle of a fixed term lease, the new landlord will have to honour the terms for the remainder of the lease period. It’s a simple transfer of paperwork, with bank accounts and names on contracts changed. If a letting agency manages your property, they’ll manage this process – whether the landlord opts to stay with your agent or not.
When you put a property on the open market, you have little control over who buys it, and it may well be bought by a private buyer who wants to move in themselves.
According to Housing Rights NI, you should make buyers aware “during the conveyancing period” that there is a sitting tenant in the property. The buyer will have to honour the terms of the tenancy agreement until it expires.
It will then be up to them to issue a notice to quit. If the tenant has lived there for over 5 years (regardless of what the fixed term lease period was) they will need more than a month's notice – 8 weeks if they have been there between 5 and 10 years and 12 weeks if they have lived there longer than 10 years.
We had a situation with a tenant whose landlord sold their house and they were keen to find a new home and regain some stability as soon as possible. In this case, the landlord agreed to the tenant leaving before the end of the contract, to move into another property.
As with most things, the legal framework is there to protect you both, but if you have a good relationship with the tenant and you make sure all agreements are in writing, there’s no reason why you can’t use your discretion to make things easier.
If you have any questions about selling a house or flat with a sitting tenant, or indeed anything else to do with renting out your property, send an email to email@example.com with ‘Ask Barry’ in the subject line.