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Selling a Rented out Property

Selling a Rented out Property

Selling a Rented out Property
Selling a Rented out Property


Selling a property may require more care when there is an existing tenancy. When the property is rented, everyone should understand their rights and responsibilities.

When a rental property is being put on the market for sale, it can be stressful for both landlords and tenants. Landlords sell their properties for many reasons; they must respect that it is the tenants’ current home.

The process can be less stressful when landlords and tenants understand their rights and responsibilities throughout the sale process.

Access to the property: Selling a Rented out Property

Landlords must get the tenant’s permission before entering the house to take photos. The tenant can refuse to allow photographs of their possessions.

Landlords must also get the tenant’s permission to show potential buyers the house and professionals like a registered valuer, real estate agent or building expert.

Tenants can’t unreasonably refuse access, but they can set reasonable conditions. They may:

  • limit access to certain days and times of the week
  • refuse open homes and auctions at the property.

Tenants can insist that the property be shown to potential buyers by appointment only. They may also ask for a temporary rent reduction in return for permitting open houses or during the lease renewal process (the landlord does not have to grant this). Tenants have the right to be at home at all times, including during open houses.

Communication and negotiation are essential. Once everyone has agreed to a schedule of access, put it in writing and ensure it’s signed by everyone involved.

We are currently also selling The Light at Cairnhill Penthouse. We have added a clause inside for it to be sold with vacant possession when required.

The Light at Cairnhill Penthouse Showroom

What happens to a tenancy when a property is sold?

Three scenarios could apply when a landlord selling a Rented-out Property

Scenario 1: Selling a tenanted property where the buyer will take over as the new landlord

The landlord is selling the property with a tenancy. The buyer shall continue renting to the existing tenants untill the lease expiry. The buyer takes over the tenancy as the new landlord.

There is no need to redo a new tenancy agreement or a novation agreement. The terms and conditions in the tenancy agreement are not affected by the sale. The new landlord will take over the legal obligations, including the need to ensure the property is in a good tenantable condition.

Once the sale has taken place ( Change of Landlord )

The Present Seller’s Acting Lawyer will make a Registered Post to the Tenant.

The Security deposit held by Tenancy Agreement has been transferred to the new Owner. 

On how to pay the rent. The New Designated Bank account for the monthly’s rent for the next rent payable. 

Their contact details and an address for service should be exchanged between the new landlord and tenants.

You do not have to be Alarmed when you are given Surprises.

There are cases when pre-existing outlaying concerns may carry forward when the completion of the new sales is taken place.

For example : 

Recommendations of Aircon Chemical Cleaning

Poorly maintained fittings that is broken and need to be replaced and subjected to minor repair clauses.

Buying a property through the BUYCONDO team, we will follow through and do the property management after the sales is taken place. Two months before the lease expiry, the new owner can decide whether to rent out further or move in for own stay.

Scenario 2: Selling the property where the buyer wants a vacant property

The landlord is selling the property with vacant possession. The Buyer wants the property to be vacant as a requirement in the conditional sale and purchase agreement.

This will be abit tricky, while there are usually no explicit clauses by default in the tenancy agreement for the landlord to terminate the lease.

However, the parties can discuss in person to see what are the available options. With the right motivation factors by each parties, an agreement can be striked upon.

For Example:

If the tenants are on a fixed-term tenancy, the landlord is to give 90 days or a mutually agreed date with written notice to end the fixed-term tenancy so that the property is vacant for the new owner. 

A fixed-term tenancy can only be by ended earlier by the landlord if the tenant and landlord agree in writing to end it. 

Suppose the tenant doesn’t agree to end the fixed-term tenancy before expiry. In that case, the landlord may negotiate a later settlement date of the sale, or the property must be sold with the tenancy in place (see scenario 1).

Scenario 3: Selling a property where the landlord wants the tenant to vacant the property to sell more effectively. (Especially when the tenant is not cooperative)

The landlord wants to market the property for sale without the tenancy in place:

  • Suppose the tenants are on a fixed-term tenancy. In that case, the landlord wants to give 90 days written notice to terminate the tenancy to market the property for sale without a tenancy. This may happen with or without any compensation mutually agreed.Or the landlord has found out of some breaches by the tenant that leads to a pre-termination.
  • If the tenants are on a fixed-term tenancy. If the tenant gives permission, the landlord may prepare for the sale (such as a real estate agent carrying out an appraisal or taking photos). 

It is not compulsory for Landlords to let tenants know they’re selling unless there it is deemed so to do it when the time comes.

If a landlord puts the property on the market, they may not need to tell the tenant in writing. We know of some landlords who will put the property listing into the market at an agreed marketing price with the estate agent. After knowing that the buyers are qualified leads, the landlord will then decides to inform the tenant. Please Note: A tenant may react poorly to a real estate agent arriving unexpectedly on their doorstep.

Landlords should consider meeting up the tenant in person to discuss it face-to-face. This is also an excellent time to talk about accessing the property for any preparations that need to take place.

Notice templates are at ‘Giving notice to end a tenancy‘.

By Request, you can also contact the BUYCONDO Team to discuss on your plans of sale.



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