Found somewhere locally we want to buy, which would mean releasing the equity in the (ONLY) house we own by selling it..
It’s got tenants on an AST until April.

At present, our only option is to sell it with ‘sitting tenants’.

Anyone ever done this? Is it just like selling a ‘normal house’?
Would I expect market rates for it – I’s suspecting it would be a few K less in reality…

Finally, I want to make sure the tenants are looked after and not ‘booted out’ – would my AST simply transfer across??

Cheers!

DrP

our only option is to sell it with ‘sitting tenants’.

offer them a couple of grand to leave?

you’re limiting your market (and property price) by selling with sitting tenants and probably lowering value by more than it’ll cost to buy out the tenants?

‘Tis a thought…
2 months rent free maybe??

DrP

EDIT – that’s stupid DrP…you want them out!! Will see how ££ sounds to them!

I’d get something legal drawn up for them to sign but giving them a wodge of cash on the day they move out (if it’s by X) has to be fairly attractive to them?

I haven’t, but one of my best mates bought a place a couple of years ago with sitting tenants.

It was pretty straight forward from what he said, they stayed on for another year in which time he had a new kitchen and boiler fitted. They then left, and he’s got now tenants.

If it’s a likely rent-able property\area then yes your market will still be smaller but might not be as bad as some might think. Depends how much of a hurry you’re in.

My parents (long story, they live in a house provided by dad’s job and effectively pay rent on that, but then need a foot on the housing ladder for when they retire) bought a house with a Tennant, no problems, no idea if it was above/below the market rate though. I imagine it’d be very atractive to other investors as it pesumambly means the house is in good ordr and doesn’t need any downtime or agents fees before they start getting rent?

Just in the process of selling my flat with tenants in situ. If anything it’s been a simple transaction-no estate agents, no survey, even though it’s in Scotland. .
Basically it’s a good investment for someone., so instead of marketing the usual way I went round local letting agents to see if any landlords were interested. It’s obviously in the benefit of the agents to discuss potential investments with their clients. Within 3 weeks of ‘marketing’ it I had an offer. The only practical suggestion I can give you is to use a decent conveyancer for all the legal stuff. As of next week my tenant gets a new landlord with absolutely no change to him.

I went round local letting agents to see if any landlords were interested

As in, physically called the landlords, or inquired with the agents, who then called their landlords?

Anyone here want a 6% return on £250k??!!

DrP

Nope, enquirys within all the local letting agents. Generally a quick call to the owner saying you have an investment property up for grabs with a long term tenant. Worked for me. Only problem is you don’t give the property a chance on the market, so you may undervalue it. I actually chatted to the potential buyer on the phone and agreed a price there and then. It’s nice not to deal with estate agents though!

Just wondering about this myself.

My tenants contract expires on the 6th October and they were here for a 12 month University contract. They have now been offered another 3 years work and want to stay on but I want to sell up to release the money for a self build.

I am thinking put it up for sale and as soon as an offer is made I give them notice and also see if someone wants it with good tenants already in place.

OR give them notice now and hope it’s not empty for too long.

One problem I do have is I need a small section of wall repaired under guarantee (tanking that has failed). Other than that the place was fully refurbished a year ago after being fully tanked and has a new heating system, up to date electrics and the outside of the buiding has just had all the corrective work done.

I sold one with three tenants in – to one of the tenants.

We’re looking a similar thing – but over a longer term.

Have you considered remortgaging the existing property to release the equity? That way a lot of your income from the rental house will be eaten by the interest – which is tax efficient, you get some of your equity and you also have a property which will be being paid off (slowly).

^^
I did, but they would only release a small amount, at a silly high interest rate.
Basically, a bad loan!

I’ll see how it all goes!

DrP

^^ ditto. + add in the maintenance of a flat in a Georgian building.

I bought a house with tenants in it and just took over their contracts (well technically the previous owner terminated the contracts and they started new ones with me, T&Cs were the same).

I’d say it’s unusual though, wife just sold her old flat to an investor and we got rid of the tenant first (on advice of the estate agent).

I don’t know what the law is in England but are landlords entitled to terminate leases early when they/their family intend to move into the property? It’s worked like that in other places I’ve lived…