Buying properties with tenants in situ.

bel2310

Hi,
Am looking into the various options on buying a property as investment and would appreciate some advice. I would be paying cash for a property. Have seen a couple that look quite attractive price wise but are already tenanted. Is this a good option to look at, or am I better buying an empty property and letting it myself. Also, my price limit covers 2 bedroom apartments and 2 bedroom terraced houses locally, which is the better buy long term.

Any ideas much appreciated.
Bel

timecharger

you can (should) ask for a copy of the AST (the lease), the tenants' references etc. If they seem good tenants and the rent is high enough, that seems fine - it'll save you a void when you take over the place, and you'll know exactly what rent you're getting

It's worth popping over to the property and checking out the tenants, etc.

Your lawyer should also check the tenancy agreement to make sure there are valid break clauses etc.

Finally, you should make the seller warrant (guarantee) in the Sale Agreement that the tenants are reliable payers, that there have been no disputes, late payments, no attempts to evict them or necessity for doing so, etc.

UK_Landlord_2

buying with tenats, should give you confidence that the property is lettable at the rent that is being asked, i have found that a lot of Estate Agents seem to have an inflated view of rental figures that a property they are selling is likely to achieve.

as TC says check to make sure the tenant are what you want, decent payers! their is a site clled landlord trader that specialise in rented property sales, they have some tips on there? thinks it just https://www.landlordtrader.co.uk could be wrong?

chugalug

Just make sure it is an Assured Shorthold Tenancy and nothing else or you'll never get them out!!

badfelafel

Ok a couple of things to mention:

• if its a short assured tenancy at a good rental, make sure the seller hasn't stuck the tenant in at an inflated rent in order to boost the price/gain your interest in the property - a common scam by sellers - there might not even be a real tenant
• if its a statutory assured tenancy it is very tricky to remove the tenant (almost impossible) but you should pay a significantly lower price for the property to reflect this, and if the tenant does leave at some point you will have made a big profit

(these terms are scottish, but the same applies wherever)

final advice is a well let property is worth its weight in gold saving hassle of finding tenants / new tenant problems etc etc.

hope this helps
Badfelafel