Selling a tenanted property can be a complex process that comes with its own set of challenges. Let’s explore the intricacies involved in selling a property while a tenant still occupies it.

Navigating the sale of a property with tenants requires careful consideration and planning. Here are 5 factors to consider when selling a tenanted property:

Condition

One of the primary challenges of selling a tenanted property is the difficulty in decluttering and staging the home. With the tenant's belongings and personal items in place, potential buyers may find it hard to envision themselves living in the space.

Appointments

Giving tenants a 24-hour notice for appointments adds a layer of complexity to the showing process. An agent with a potential buyer might bypass the property since they can’t schedule the appointment on the same day as other appointments when showing potential properties to their clients.

Vacant Possession

Buyers intending to move in face hurdles when tenants have long-term lease agreements. The buyer has to honour the lease agreement if it is within the contract period. Only after the term expires or the lease is month to month when the tenant can be provided with the N12 form to vacate for the buyers to move in. There have been cases where the tenants do not move out. If the buyers have sold their to move into the property they have purchased and the tenant does not move out, you can see how this can get complicated very quickly.

Closing

Instances where tenants fail to vacate as per the N12 form can result in delayed closings, causing stress and financial strain for both buyers and sellers. Planning for such scenarios is crucial to avoid last-minute complications.

Price

Tenanted properties often sell for less due to the inability to declutter the tenants’ belongings and hence not showing as well as other staged properties. Also, many buyers shy away from buying tenanted properties due to the complexity of dealing with tenants who might not vacate by closing

Conclusion

Selling a tenanted property can be complicated but it does not have to be. A pro-active approach is to work out an agreement to vacate upfront then get the property ready & staged to sell. This would open up the pool of potential buyers who might be interested in the property. Understanding this option might not feasible, working with the tenant is a sound approach in selling the process.