Selling a Tenanted Property: A Guide for Central London Landlords  

Central London is home to a bustling rental market, but there may come a time when you want to sell a buy-to-let property and in favour of new ventures. So, what’s the best way to approach selling a tenanted property in central London?  

You may think you have to ask your tenants to leave when it’s time to sell your rental property in St John’s Wood, Maida Vale, Notting Hill, Victoria or Soho – in fact, that’s not always the case.

Can you sell a property with tenants in situ? The answer is yes, but read our guide to selling a tenanted property in central London before making a decision. 

Pros & cons of selling with tenants in situ

Consider the costs, benefits and paperwork involved in selling buy-to-let properties with tenants in situ. Here are some of the pros and cons:

Pros

• No void period or lost rental income
• Tenanted properties don’t attract a council tax premium
• Avoid the costs and delays of evicting your tenant
• Buyers can earn immediately and avoid marketing costs

Cons

• Limited to selling to another landlord
• Viewings rely on your tenants’ behaviour
• Tenants may be anxious about the property’s sale
• Extra paperwork including safety certificates, deposit details and proof of right to rent

Key points to consider  

London landlords should consider these key points as a guide before selling a tenanted property. Always consult a good agent about your property sale and the local market. 

Property value with/without them  

Homes with a sitting tenant can attract a lower selling price, though in high demand areas the difference can be minimal. When selling a buy-to-let, evidence of reliable tenants and a good rental yield can make your property more appealing to investors.  

If there is a need for substantial work on the property before sale 

Carrying our repairs and updates to empty properties may attract more buyers and a higher price, but consider your property’s condition and target market. You may avoid extensive refurbishment works by selling a property with a sitting tenant.  

Type of tenancy agreement in place & how this affects ease of sale  

The type of tenancy agreement could determine how easy it is to sell your rental property, and you must also check the terms of the tenancy agreement. For example, in the UK, you only evict a tenant on a fixed-term assured shorthold tenancy agreement if the break clause allows it or the fixed term is expiring. Otherwise, assured shorthold tenancies pass to the new landlord. 

Tenant rights when conducting the sales process  

There’s no change in the tenants’ rights when the landlord sells their property. Your tenants have the right to quiet enjoyment of the property – for instance, you must give notice for viewings. 

Alternatives to selling a home with tenants  

If you don’t want to sell your property with sitting tenants, there are other options to consider. 

1. Getting short-term tenants 

Renting to short-term tenants allows you to collect rent during the sales process, without a long commitment. 

2. Selling with vacant possession  

You can evict you tenants to sell the property with vacant possession by issuing a Section 8 notice or Section 21 notice to tenants to start the eviction process. Always follow the rules including notice periods, and remember that tenants can challenge their eviction.  

Selling a property with tenants: the process  

You can sell a home with a sitting tenant on the open market on at auction. This is how to sell your tenanted rental property: 

Selling with an agent

• Find an agent –choose an estate agent with good local knowledge, access to property portals like Rightmove and Zoopla, and experience in selling a property with tenants in situ
• Viewings – your agent will conduct viewings and share key information with prospective buyers
• Receive offers – prospective buyers will make an offer which you can accept or reject
• Surveys – the buyer will typically arrange for a surveyor to visit the property
• Exchange and completion – you will set exchange and completion dates
• Pay estate agent fees – pay the fees on a percentage basis

Selling property at auction

• Make a choice – look for an auction house who knows how to sell rental properties
• Set a minimum price – you don’t want to sell too low, so set a price you’re comfortable with
• Surveys – potential buyers can commission a survey before auction day
• Auction day – the highest bid wins, you exchange contracts and set a completion date
• Pay auction fees – usually a set charge to enter the auction plus a percentage of sale price

And Finally 

There’s a lot to consider when you sell an investment property, however, working with a trusted local estate agent can give you confidence. Before you sell your buy-to-let property in Pimlico, Marylebone, Chislehurst, or Fitzrovia, find out what Intra-Capital Estates can do for you. 

Want to find out more about letting your property? You can check out our articles covering how to sell a tenanted property, buying rental properties through a limited company, determining a reasonable rent increase amount, property inspections – and much, much more.