Brexit uncertainty has effects on Bethnal Green and Bow. It sounds unlikely, but national unease in the financial markets means that consumer confidence is down. Reluctant buyers put downward pressure on sales prices.
Home prices in London averaged a modest uptick of 4pc in the past year. Tower Hamlets managed to average a whopping 9.4pc increase. Part of the increase is a very desirable location to buy or rent.
If you are a longtime homeowner, now is a great time to sell your flat in Tower Hamlets. If you are an owner with tenants, there are some special considerations before you put your home up for sale.
Read on to learn more.
How to Sell Your Flat in Tower Hamlets
To sell your flat for a top price, buyers demand top conditions. In an ideal situation, you sell your own personal residence. The steps are easy.
If you are a landlord, you have several additional legal steps. Several government acts protect the interests of tenants. If you have a well-written, legally-binding tenancy agreement, you have certain obligations, as does your tenant.
If you do not have an agreement in place, and your tenants are paying rent, it is in your best interest to negotiate an agreement with them before selling your flat.
Some Things to Consider
As the owner of the flat, you have the complete right to sell it. However, you do not have the right to evict the tenant just because you want to sell. You may sell the flat with the tenant still in possession and transfer your contract rights to the purchaser.
As the owner, you are allowed to show your property to prospective purchasers only under certain circumstances. They are:
- as authorised by your tenancy agreement
- upon giving the tenants at least 24 hours notice in writing
Without these rights included in your tenancy agreement, your tenant may allow no visits at all, at their whimsy.
Even with a well-written agreement, your tenants have the right to refuse access at times inconvenient to them. If you have many showings, this may constitute a breach of their rights. It is their home and they have a right to quiet enjoyment.
Selling With Your Tenant In Situ
‘Tenant in Situ’ is a fancy way of saying with a tenant in the flat. When your property sells, the buyer is the new landlord to the tenants, in the same way, that you were. Law professionals describe this as ‘standing in the shoes’ of the seller.
The buyer gains no rights from the sale and may only evict under certain circumstances. Tenancy agreements are valid even if the landlord’s name changes. Some buyers actually find flats with good tenants and agreements in place more attractive than empty flats.
As the sale completes, the seller should send a formal letter to the tenants to inform them of the change in landlords and any details for rent payments. The seller should prepare statutory declarations of the start of tenancy and service of notices for the buyer.
The buyer should get new tenancy agreements signed as soon as possible after the sale.
Evicting Tenants Within the Law
Some buyers who plan on living in the flat themselves or who have a plan for future tenants may want an empty flat at the sale. Those able to deliver a controversy-free sale have more bargaining room.
A legal eviction begins with the service of a valid Section 21 Notice. Landlords may only evict if there is an appropriate break clause to invoke or the tenancy period is over. The minimum notice for eviction is two months.
If the flat is sold while the tenants are still in residence, the buyer has no greater right to evict the tenants. Any deposits paid to the original landlord are transferred to the new landlord.
Disadvantages to Selling With Tenants
While your tenants occupy the property, you cannot undertake major or minor renovations without their approval to be in their home. If you do not already have a valid tenancy agreement in place, you may be completely at their mercy.
Tenants who know you wish to sell or who have out of date tenancy agreements may delay or otherwise sabotage sales plans. If you have a bad tenant or one that is uncooperative, the burden of evicting the tenant is on you.
Most buyers will not take on a regulated sitting tenant. The process to evict a tenant is long and arduous. If an investor is looking for an instant income, an occupied flat without a solid, transferable rental agreement is a poor choice.
Take Advantage of the Local Market
National property sales prices are rising slowly or not at all. Local Tower Hamlets sale prices continue to grow. Take advantage of the continued demand and sell your flat in Tower Hamlets now.
If your flat is owner-occupied or empty, you can list your property quickly. If your flat is occupied by a tenant, you must decide if you will evict the tenant or not. The minimum notice for eviction is two months and you must have a valid reason to invoke a break clause.
Showing the flat requires tenant cooperation. It is in everyone’s best interest to have a tenancy agreement in place. The tenancy agreement transfers to the buyer if the flat sells while the tenant occupies the property.
Different buyers have different needs. Let Property Sauce make an offer on your Tower Hamlets flat. We can help you navigate tenant agreements, selling with tenants in situ and offer you cash quickly.
Contact us today for a free, no-obligation offer.