We’ve talked a lot on our blog about buying investment properties, but what about if you’re selling an investment property? And what if you have tenants? Don’t be daunted, we can help.
There are certain legal obligations that both the seller and the tenant need to be aware of. For instance, tenants must allow the property to be shown to prospective buyers a reasonable number of times and with at least 24 hours notice. Unless agreed to by the tenant, the property cannot be shown before 8am or after 8pm, on Sundays or public holidays.
It is important to ensure that Buyers who wish to reside in the property rather than purchase it as an investment for themselves, are aware of any leases in place as there are terms that legally have to be adhered to relating to the type of tenancy agreement in place at the time.
Fixed term tenancy agreements require 14 days notice to be given to vacate the property at the end of the tenancy term. Ideally you’d like to keep tenants in the property as long as you own it, so choosing to vacate them just prior to the settlement date (as long as 14 days notice as been given) is good for both the sellers (who capitalise on longer tenancy) and buyers (who take vacant possession).
Periodic or continuing tenancy agreements require 60 days notice to be given to the tenants or 30 days notice if you have advised the tenants of your intention to sell and then sign a contract of sale. If the Buyer is purchasing the property as an investment, once settlement has occurred, the new owner is entitled to the rental payments and is responsible for the property from thereon.
Tenants need to be prepared for the fact that if a buyer wants to move into a home they may need to move on once their lease expires, and should talk with the agent about whether they should expect a notice to vacate the property at the end of the tenancy. Whilst the agent may not know either way, it’s a good idea to keep the communication lines open.
Communication is important for all parties involved. A tenant who is kept up to date is likely to be far more co-operative during the sale. So take the stress out of selling your investment property by making sure you have qualified professionals in place to help you make sure you’re doing everything by the book.
We’d love to talk to you, so please don’t hesitate to give the team at Professionals Mudgee Real Estate a call any time!