Buying A Property With Tenants In You may hear the terminology “Tenants in sit Show Content
Buying A Property With Tenants In
You may hear the terminology “Tenants in situ”- that basically means that the property is being occupied by a Tenant at the time of a sale.
What happens when you buy a house that has Tenants in situ?
The Tenants will remain in the property under their terms of their tenancy agreement. When a property is sold – the new owner is responsible for all outlined in the agreement – whether that’s rent collection or maintenance.
Here is a list of things to look out for when you have Tenants in situ:
1. You may want to change to a HMO but make sure it’s allowed in the area
2. Was there an inventory check in completed at the start of the agreement?
3. The property may be licensed
What are the pros have having Tenants in situ?
1. There is immediate income as there is a Tenant already in place
2. There is no need to pay for advertising in looking for Tenants which could have took time
3. It is very likely that immediate refurbishment is required as it’s likely that the property has been in a good condition as Tenants are still in the property
What are the cons of having Tenants in situ?
1. Some lenders can be reluctant to finance a property with Tenants in as it can be a high risk
2. You have not chosen the Tenant yourself so they may not be a good fit
3. There may be issues with the property if Landlords sell with Tenants for a fast sale
It’s important to understand the rights of the tenancy agreement if selling or buying a property with Tenants. Be sure to check those out!
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