Our Top 5 Tips for Selling Tenanted Property

Ok, let’s be honest – selling tenanted property is our thing – it’s not as if we make a secret of it!

If you’re a landlord looking to move some property on, and you currently have tenants, it’s tempting to think that you’ll get a better price without them and that you’ll find selling faster and easier. You might, but it’s not guaranteed.

In fact selling your property with tenants in situ has many advantages, for you, for the buyer and for your current tenants so it’s worthy of consideration, and with the right agents and advice it could be much easier than you think.

So, gathering up our considerable experience we’re going to share our top tips for selling tenanted property.

1. Speak to your tenants

We cannot emphasise this enough, which is why it’s at the top of our list. Your decision to sell doesn’t just affect you, it affects them and if handled poorly you are going to cause a huge amount of unnecessary stress.

Moreover, you are going to need their goodwill in order to ensure that the process goes smoothly as you will require access to the property and upset tenants are far less likely to be cooperative.

As an aside, once they know you are selling, they may be interested in making an offer, which is a win-win, but even without that you need to reassure and explain that their tenancy is going to continue with a change of landlord, if they choose.

2. Choose an agent with experience of selling tenanted property

There are few aspects of life where you would willingly choose to rely on a complete rookie; selling tenanted property is no different. Find an agent with experience and a demonstrable track record of selling with tenants in situ.

If this is your first experience of selling like this, their knowledge will be invaluable. They know what needs to be done to ensure a smooth, trouble-free process and also how to maximise your return.

They will be able to help you navigate the various legal requirements, although as a conscientious landlord you will be all over these anyway. Having your compliance up-to-date makes the process much easier. Which nicely leads to the next tip…

3. Ensure your property is ready for market

Unlike selling to the residential market this doesn’t mean a lick of neutral paint, a deep clean and a loaf of bread permanently warming in the oven!

Rather this has more to do with ensuring that all your legal requirements as a landlord are in place, current and will remain so until the sale date. If you haven’t already, get all the paperwork together now.

If there are repairs or maintenance required which is your responsibility, now is the time to get it done. This will ensure that there are no problems with the home report which could blight a sale.

Failing to ensure that all of this is done will have a direct and negative effect on the chances of finding a buyer or achieving a decent price.

Don’t forget to have evidence of the yield a potential purchaser can expect as this will factor into their buying decision.

Remember – you are looking to sell to another landlord and they – not unreasonably – will expect a prospective purchase to be literally ready to go, fully compliant and profitable. Failure to demonstrate this will cost you dearly.

As agents, we’ll double check that all is as it should be before listing your property, but making sure it’s all as it should be now will make the process, and therefore the sale, far easier.

4. Make sure you’re aiming at the right market

Ask your agents how they’ll go about selling your property. Simple question, deserving of an equally simple answer.

As a landlord looking to sell a tenanted property you are already addressing quite a niche market. Potential buyers may be complete novices taking their first steps in property investment or experienced fellow professionals.

Your agents should be able to market your property to the right buyers, in fact, they may well maintain a database of potential buyers for properties just like yours. In that case you’ve just won the property-selling lottery – congratulations!

That said, don’t be surprised if they suggest marketing on the open market as the best way to reach more potential buyers. It doesn’t mean that they’re trying to reach out to residential buyers.

Regardless of their proposed strategy, you should feel confident with their advice and knowledge of the market.

5. Set the right price

Price is (nearly) always negotiable however it’s crucial that your asking price reflects the market as closely as possible.

Too low and you’re doing yourself a disservice; too high and you risk putting off potential buyers. Experienced landlords will understand that they shouldn’t necessarily expect to get open-market residential prices.

Equally, if your property delivers a solid rental return and represents a good capital and income-generating opportunity, be careful you don’t undervalue it as a business opportunity.

Any agent worth their salt will have extensive knowledge of current market prices, usually across the country, and a feel for how active the market is at any given time.

Trust their knowledge, but don’t be afraid to question it so that you understand the thinking behind their price suggestions.

Advice from the property pros

Selling a tenanted property is not the same as selling an attractive flat in a popular area of a popular city, and therefore your approach and the agents you choose need to have experience of that specific market.

Our top tips for selling tenanted property are designed to help you get ahead of the game before your property even hits the market. Doing so will make the whole process simpler and smoother.

Choosing the right agents is, in our view, one of the key decisions you need to make. A big, high-street estate agency may have staff who deal with investment properties, but they may not. Be sure to ask before you commit.

Seek out and speak to specialists like Portolio. They’ll have a better handle on the market and understand how and where to market your property to ensure the best return and quickest turnaround.

In summary…

Selling tenanted property isn’t rocket science, but like rocket science having – or having access to – specialised knowledge can go a long way to avoiding any unfortunate ‘booms’!

There is generally little that can be done to expedite the legal process, but preparation will make it much easier and far less stressful – a little work in advance will pay dividends in terms of your inner peace.

If you’d like to know more about the ins and outs of selling a tenanted property, get in touch and arrange a chat, we’re always happy to sit down with you and explain the process and answer your questions.

Thanks for reading our top tips for selling tenanted property – we look forward to helping you.

Written by Ross MacDonald, Director of Sales & Cofounder of Portolio

Get in touch on 07388 361 564 or email to [email protected]