If you are a landlord, then you will no doubt be aware of the struggles that come with managing tenants.
Hopefully, you have a rental portfolio with no issues at all and have tenants that are polite, pay their rent on time, and keep your property in a good condition. But for some landlords this might sound like a pipe dream!
You are bound by tenants’ rights as to how you can act, even if your tenant is causing you bother. One option that you may have at your disposal if you have a buy-to-let property is selling a rental property with tenants.
So, if you are a landlord with tenants and are wondering ‘can I sell my home for cash’, then read on for more advice on this topic.
Dealing with a problem tenant
There are many ways that a problem tenant could cause disruption to your life and your livelihood. For example, you could have problems with tenants not paying rent, or tenants causing property damage by being disrespectful or careless with your furnished property.
Evicting problem tenants remains a problematic issue and there are hoops that you need to jump through in order to get them evicted from your property.
As best practice, you should always keep a log of every interaction that you have with your tenants, and do your best to keep your interactions through writing so both parties have evidence of what has been said and by whom.
Before any tenant moves in, you should have a thorough report on your property with photographic evidence and as much information as possible regarding the condition of the property and the current inventory if there is one. This will make it much easier to prove that your tenant is liable for any damages that you discover on your routine property inspections.
Selling a house with tenants UK
In the UK, landlords and tenants are bound by a tenancy agreement that dictates what each party can expect from the other. Evictions should be a subject within a tenancy agreement, specifically clauses referred to as Section 21 and Section 8.
There are restrictions as to when you can use Section 21 and Section 8 notices, and if evicting a problem tenant is proving to be too complex and is beginning to drag on, then it may be more worthwhile for you to sell the property with tenants in situ.
By doing this, you can rid yourself of a problem tenant and receive funds that you can use to invest in a new property. And fortunately, there are no restrictions that apply to landlords as to whether or not you can sell a property that you are renting. The buyer of the property will take over as landlord and inherit the existing tenancy agreement.
Selling a rental portfolio
Selling a rental property with tenants is a good way to release some of the equity that is tied into your rental portfolio. You can then use this money as you wish, such as making improvements on any of your other properties or making new property purchases. Or you could simply treat yourself and your loved ones!
Whether you sell your entire rental portfolio or part of it is up to you. Sometimes the best process you can follow is to sell your properties one at a time so your properties do not saturate the market. If your entire portfolio is listed on the market at the same time, then this can attract buyers seeking a discount for buying in bulk meaning you will make less profit.
There are some things that you should bear in mind when selling your rental properties, the main issue being how the sale will affect your capital gains tax. This is the tax that you pay on any profit that you make from the sale of your buy-to-let property if it has increased in value from the price that you paid for it.
Capital gains tax can be charged at a higher rate or a lower rate and is dependent on what rate of tax you pay and how much profit you are making from your sale. We advise that you discuss this with your accountant before making any decisions.
Easy Sale property buyers
At Easy Sale, we can buy your rental property for cash with very little turnaround between our quote and the money arriving in your bank.
We do more than just buy properties from landlords; we can also buy properties from individuals trying to stop repossession or people who need to release equity for other purposes. If you are wondering whether equity release is safe then you can find out more about the official process, but equity release from a property sale is very much safe, easy and quick.
Get in touch with us for more information on how we can help you according to your specific circumstances and property type.
FAQs
Can I sell my property with a tenant in it?
Yes, selling a tenanted property is common practice and your tenants do not need to be evicted before you sell.
Landlords selling their buy-to-let property often let their current tenants know in case they want to buy the property off you so that they can own their own home.
However, sometimes this is not the best course of action and it would be more appropriate to sell the property to another investor who wants to build their own rental portfolio.
What is a sitting tenant?
A sitting tenant is one who is currently renting a property that is being sold by a landlord.
As discussed in this article, selling a house with a sitting tenant is very much possible and should be considered if you want to cash in on a portion of your rental portfolio without disrupting your current tenants.
