Buying tenanted property

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    Buying tenanted property

    Hi all,

    Could you think of a reason why someone would sell a tenanted property instead of evicting the tenants and sell it for 33 K more? Nothing springs to my mind rather than problem tenants or some legal issue...

    #2
    Pre 1988 tenancy and hoping to catch the ignorant?

    Comment


      #3
      As jko states. I would firstly check that the tenant CAN be evicted.

      It isn't that unusual however to sell with a tenant. Landlord may have financial problems and require a quick sale. We all know eviction is not quick

      He may also just want to avoid the hassle or it may be a family member who is the tenant.

      As long as you check and double check the date the tenancy started and that deposit etc was protected if relevant

      Comment


        #4
        Originally posted by Wright76 View Post
        ..............As long as you check and double check the date the tenancy started and that deposit etc was protected if relevant
        - but in particular ask the tenant when they 1st moved in: There may be a lovely shiny new signed AST but if he moved in prior to 1988 there's pretty much no chance of ever evicting..
        I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

        Comment


          #5
          It isn't uncommon these days to find savvy tenants running rings around clueless landlords and I can imagine many wishing to just give up because they have sc@@wed up so badly on the fundamentals that all attempts at eviction have failed and they just want out. By rights there should be a glut of cut-priced btl properties heading our way sometime soon just as long as we can unravel the mess and have the financial and emotional reserves to see it through.

          Comment


            #6
            Speed. They like the tenants and dont want to be the person who evicts them. Ignorance of the effect it has on the selling price.

            I'm keeping an eye on the market but not buying as I'm interested in a London property and that is already showing small falls with the sort of properties normally bought as btl not moving. Further falls seem more likely than not.

            Comment


              #7
              Can I ask a really naive question please? I am assuming (?) that selling a property with a tenant in situ reduces the value significantly as it vastly reduces your potential buyer pool. But is there another reason please? I'm asking as thinking of selling a property and truly don't want to evict my elderly tenant. Would appreciate your comments.

              Comment


                #8
                I don't think you have understood the others' answers.

                The tenant in the property may be a 'regulated tenant' and that means you cannot evict him via the normal process.

                Read up on 'regulated tenancy' and go to see tenant and find out exactly when he moved into the property - there may well be a catch. We get lots of these cases and buyers like yourself Caroline777 do not take on board what they are being told. You need to do the research yourself - we have pointed you in the right direction. It may not be easy to evict him - being 'old' hints that he is on a regulated tenancy and NOT an AST.



                Freedom at the point of zero............

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                  #9
                  Originally posted by Caroline777 View Post
                  Can I ask a really naive question please? I am assuming (?) that selling a property with a tenant in situ reduces the value significantly as it vastly reduces your potential buyer pool. But is there another reason please? I'm asking as thinking of selling a property and truly don't want to evict my elderly tenant. Would appreciate your comments.
                  That's not a niaive question.

                  Selling with a tenant in place does reduce the pool of potential buyers.
                  It also means that potential buyers will be buying for their business and may be more savvy than a home buyer.
                  They're also likely to care less about the purchase and pull out if anything is less than perfect (while a home buyer probably imagines themselves living in their new home and will work through some problems to get there).
                  A landlord buying a new property is going to pay more stamp duty than a home buyer and will try hard to offset that increased cost, either by up-front negotiation or by chipping away as any issues arise.
                  There are potential issues with taking over a tenant - with the deposit and the tenancy agreement (even if the tenant is otherwise in a standard tenancy) which the purchaser will want protection from.

                  Any purchasing landlord is possible going to be a client of the agent selling the property - which can be tricky for you as a seller (the agent isn't meant to do that, but it happens).
                  When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                  Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                  Comment


                    #10
                    It can also be the opposite and being sold for more than it's value to an investor. For example, if it's being let as a HMO with several tenants. Sometimes giving what appears to be 10% + returns, even in poor condition.

                    Comment


                      #11
                      different dates in the uk............................

                      Pre 1988 Tenancies

                      The date for Regulated Tenancies is before

                      15th January 1989 in England and Wales

                      2nd January 1989 in Scotland

                      1st January 2007 in Northern Ireland.
                      Thunderbirds are go

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                        #12
                        if your tenant is very elderly and paying a decent rent you may have less of a problem selling. I'd expect a discount on the price but I'd hope the tenant would die and save me the bother of eviction.

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                          #13
                          We bought a house with 2 lots of tenants many years ago now. It was a probate sale. The house is in a London suburb and the beneficiary was in Liverpool. Even at the knock down price we paid it was probably enough to buy a mansion in Liverpool. Plus he didn't need to deal with tenants miles away. So he was probably very happy with the money he got.

                          Comment


                            #14
                            Originally posted by buzzard1994 View Post
                            but I'd hope the tenant would die and save me the bother of eviction.
                            Who says landlords aren't nice people.
                            8-)

                            If it's a regualted tenancy it can be inherited - so death may not be the solution.
                            When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                            Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

                            Comment

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