Selling your tenanted Sydney investment property

Some property investors are surprised to know that rather than being a drawback, a tenanted property is often extremely attractive to investors. This is because they will already have the security of a steady income when they purchase the property. So if you are thinking of selling your investment property, read this first.

Can you sell a tenanted investment property?

Absolutely! And at HPA we have a lot of experience with this and can help you along the way. In fact, with the current rental crisis, your tenants may wish to stay anyway.

Or, they may even want to purchase the property themselves if they’re able to. Essentially, this will save you a lot of time and stress as you will have ready buyers for your property.

What are the laws in NSW?

In NSW, there are a number of rules that govern the sale of a tenanted rental property. Here’s a quick snapshot of what you need to know.

• As the landlord, you have to give the tenants 14 days notice before opening the property for viewing.
• You should also work with the tenants to agree on a suitable day and time for showing prospective buyers through the property.
• If you want to have an open home inspection, you must work with the tenants to ensure that this is agreeable.
• Keeping your tenants on side will help with this.
• Inspections must not be carried out before 8am or after 8pm, or on a Sunday or public holiday.
• Before photographing the inside of the property, you should give reasonable notice to the tenants. Here again, it’s worth keeping them on side so the property looks reasonable in the photos.
• You also need to ask for consent from the tenants before you put a ‘For Sale’ sign up on the property.

If your tenants have a fixed-term agreement in place at the time of the sale, the agreement will transfer to the buyer and the tenants can carry on with their lease uninterrupted.

What are the advantages and disadvantages of selling a tenanted property?

There can be many advantages to selling a tenanted property but there are also a few negatives.

Advantages

One of the major advantages is that you will continue to receive rental income from your tenants until the property is sold and settlement has occurred.

Having tenants in place already makes the property particularly attractive to other investors because they will receive rental income as soon as the property settles. This also saves them time and money because they don’t have to pay to advertise the property for new tenants.

Of course, you also have the option to sell the property to the tenants. This will certainly save you money because you won’t have to pay any advertising costs.

A well-cared-for property that has tenants in place is often more attractive to potential buyers than an empty one.

Disadvantages

You have to remember that you need to give the tenants plenty of notice before you put the property up for sale and also, before each inspection.

If your tenants are not amenable, they may not present the property in a clean and tidy condition and may refuse to work with you in regard to inspection times and taking internal photos.

Sometimes, having tenants in place could put off certain buyers that may want to purchase the property to live in themselves.

This is why it’s important to work with an experienced agent who knows how to keep the tenants happy and sell your property in the easiest way possible.

Selling your investment property? Talk to us

If you have an investment property that you’re wanting to sell, talk to us first. We have a lot of experience selling investment properties that have good tenants in place and will work with you to ensure that the tenants are happy and that you get a fast sale.