Maloney’s Property, one of Canberra’s most trusted and experienced real estate agencies in the Canberra region, would like to share insights on selling a property with tenants.
In this article, we will concentrate on three aspects:
- Benefits of selling a rental property with tenants
- Complying with the Residential Tenancies Act 1997
- Effective strategies for marketing tenant-occupied properties
Benefits of selling a rental property with tenants
When selling an investment property, a good tenant is a significant asset. ‘Good tenants’ are hard to come by, and if you have a stable, rent-paying tenant locked in – it could seal the deal regarding a sale.
There are other benefits of having a tenant in place during your sale, such as continuing to have an income – to pay a mortgage - during the sale process, which could take up to five months when you take a settlement period into account.
So, in a nutshell, the top five benefits of selling a rental property with tenants are:
- You will have an income during the sales process (possibly up to five to six months, including the settlement period) to pay your mortgage.
- Your buyers will not have to look for a tenant for their investment property.
- All the hard work of finding a ‘good tenant’ is done for your potential buyers.
- You do not have to go through the process of removing your tenant.
- You can sell when the market is right for you to sell.
Complying with the Residential Tenancies Act 1997 (the Act)
There are certain things you must do to comply with the Act when selling a property that is tenanted.
Access to the property for sale inspections:
- You must notify the tenant in writing that you are selling the property.
- You must give 48 hours' notice of a sale inspection, and you can only do two per week.
- Unless the tenant agrees, these sale inspections can only take place between 8 am and 6 pm, Monday to Saturday and not on public holidays.
- You cannot let yourself in with your own key if the tenant disagrees with a proposed time.
- You must not interfere with the tenant's reasonable peace, comfort, or privacy.
- The property must be kept ‘reasonably clean’ by the tenant.
Notice to leave:
- If you decide to sell your property in the first six months of a fixed-term tenancy, the tenant can give 14 days’ notice to end the agreement.
- The tenant can do the same if you want access for more than eight weeks to conduct sales inspections.
- You can end a fixed-term agreement by giving eight weeks’ notice to the tenant.
- The tenant can give three weeks’ notice during the eight-week period to end the agreement.
After selling the property:
- You must give the tenant written notice of the buyer’s name and address.
- You must let the tenant know they will make future rent payments to the new owner or agent.
Marketing your tenanted property
As listed above, there are benefits to selling your investment property with a tenant in place, but it can also be inconvenient for them. To ease this process, Maloney’s Property makes the following suggestions:
- Employ good communication with your tenant and listen to any reasonable concerns raised.
- Follow the laws and regulations required when selling a tenanted property.
As you can see, selling a tenanted property requires significant knowledge, experience, and time – but it can be a real asset.
With 30 years of experience in the Canberra property market, Maloney’s Property have successfully guided numerous property investors in managing and selling tenant-occupied properties.
Reach out today and schedule a meeting with a trusted agent from Maloney’s Property to explore how we can assist you in selling your investment property in Canberra.
