When to give notice to a tenant when selling the property

Landlord Discussion
1

Hi all, I have a tenant who has been the perfect tenant and who has been in the property for 6months so his agreement has finished but I am letting it roll on without renewing. He knew when he moved into the property that I was trying to sell and has been accommodating with viewings etc.

I am about to accept an offer from a buyer who wants to move fast and has already asked how much notice I have to give. My quandary is this - I don’t want to lose the sale because of dragging my feet with giving the tenant notice and actually because he has been so good I absolutely want to do the right thing by him. However, if I give him notice straight away and therefore as much time as possible in order to find a new place and then the buyer decides to pull out I may have lost my tenant. Does anyone have any thoughts or advice? Thanks in advance.

2

only you can decide, give the tenant notice. You want to sell? many sales fall thru, it is a lottery if it falls thru you can ask him does he wnt to stay on,…

3

The sale becomes legally binding once you have exchanged contracts and agreed a sale date,I would advise the tenant after exchange.

4

some people exchange and complete on the same day . so you would need to set the completion date well after exchange of contracts

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5

Presumably the buyer knows you have a tenant and notice period is now six months?
Are you hoping the tenant will find somewhere before the six months is up?
If you have a good relationship with the tenant and explain he may start looking straight away as opposed to after Christmas. Or offer a cash incentive to help him on his way.
Be upfront with the buyer. If the time scale is too long for them then be clear with them regarding how long they are prepared to wait.

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Colin3 Yes, I agree. It’s a tough decision! Thanks for your help.

7

Thanks Leslie1, good advice.

8

Thanks Mr_T, his 6months are up so he is only on a 1month notice period, I just want to be fair to him and so ideally would give him more but think I am going to have to work with 1.

9

Remember that the notice periods set by the law are changing all the time, and getting longer. You might try to help source a new place for him complete with great reference and prompt deposit repayment (and other incentive? help him move?). It will be far easier for him to give you a leaving date (in writing) than for you to impose one.

10

You misunderstood Mr_T. On all notices after the fixed term (I believe, you have an Assured Shorthold tenancy for six months) the landlord must give a notice to leave as the the tenancy does not just end. Due to Covid-19, the minimum notice must be 6 months whereas before Covid-19, it was 2 months. You could just speak to the tenant and mutually sign a date where you both terminate the tenancy and that is the date he should leave.

Be warned, good tenants can end up being bad tenants when they cannot find accommodation to move to so, even if the tenant signed the mutual termination agreement decides to stay on, you are not able able to force him to leave and would have to apply to the courts to get a bailiff eviction which at present would take at least six months with the back log of cases.

The safest solution, is to ensure that your tenant vacates before your exchange otherwise you could end up with huge problems if the buyer is left with a tenant in situ

11

I thought landlords had to give 2 months notice to the tenant. The tenant only has to give one months notice starting from a tenancy period. ?

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Not since Covid. It’s recently changed again and a landlord now has to give six months notice to a tenant.

13

So it’s changed for landlord but is it the same for tenant - one months notice. I am struggling to find new tenant in this pandemic after only being given one months notice. I have loads of enquiries but they are not working.

14

be careful wrong tenant will be a diaster

15

Unfortunately you now have to give 6 months notice and I don’t think any buyer (especially a keen one) would accept that.

Your only potential way out of this might be to incentivise the tenant to leave earlier - e.g. cover their moving costs.

Whatever happens you wouldn’t want to exchange until the tenant has physically left and handed back the keys because if you can’t complete at the arranged date with vacant possession you are liable to the buyer and the compensation is significant.

16

Four years ago i went thru the same dillema
I had a tentant for 22 years who i gave 6 months notice of my proposed sale. She was willing but unable to move because she was in receipt of HB and they would only concede that her vacating was not “making herself voluntarily homeless” if the baillifs evicted her .
Section 21 at that time was ignored by the council.
I gave her one year’s rent in cash so that she could afford to leave.
The moral ( or is it immoral) is don’t let to housing benefit. The councils have no respect for legalities.
In Germany a buyer can accept an existing tenancy.
Maybe your buyer could be persuaded to come to an agreement with your tenant

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17

I agree with Fraser1 that you have to give 6 months notice (during the pandemic) since August this year. Thus earlier comments suggesting that you wait until exchange of contracts before giving notice would put you in an invidious position as you legally don’t own your home after you have exchanged and you would pay heavily if you could not meet the agreed completion date (which is normally the time given to move and sort the money out). Unless you can persuade your tenant to go within a few weeks such as Fraser has described) or have a uber understanding buyer who is happy to wait for 6 mths to complete (good luck with that) or one that is an investment buyer and will take a sitting tenant your sale is unlikely to go ahead. Sorry.

18

I’d be careful with trying to please everyone- Covid means that a tenant has to be given 12 weeks notice so you’ll need to give your tenant 3 months via a section 21- even the nicest tenant can turn nasty

1 Like
19

I too have just had a good tenant change out and put the flat on the Rental market. I had loads of enquiries, all unsuitable. It’s best to wait to ensure you do not get a bad or nightmare tenant always get a guarantor unless circumstances and experience helps alternative solutions.

As Colin says, be careful

Eventually out of the blue one turned up I could accept and he moves in, in a weeks time. Over the new period one’s decisions are either confirmed or you learn another lesson.

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Re the sale and good tenant, you are really asking for your cake and eat it.

Have you checked the buyer out?
Do they have a recent letter of confirmed mortgage.
Are they being reasonable?
What’s their employment status?

These will help you decide if the sale is likely to be good or risky.

If okay talk a reasonable completion date
Speak to your tenant and see if they are okay to move voluntary to match the date
If they are see if they will put that in writing to you giving you notice.
Everything you do, do in writing and within the law.

As you say you are desperate to sell you will have to take risks.
Either go for a legally binding date through the normal process
Or
Get the buyer to put down a non returnable deposit to complete by the agreed time… This has its risks for you but shows commitment to them and if you fail you will have to pay and lose that sum. The special agreement can be done by your solicitor with conditions. At cost. A friend has just don’t this very thing via a solicitor.
This together with the tenants voluntary notice may solve your problem. If the buyer pulls out you get the deposit. You overcome the 6 month landlord notice .

However, as always this walks a fine line although it may not be needed if the tenant leaves and the buyers contract goes through.

What if the tenant cannot find a suitable place and good tenant turns to I’m not going to or cannot leave. Then the 6 months rule ( minimum) before you get them out kicks in and you either lose financially or the sale.

Things to help close both scenarios if you check the buyer and follow one of the chosen routes above.

Help your tenant look for a new place by keeping an eye on the market for a place to suit their needs.

If they find somewhere offer help to move out and in.

If they find a place write to them with a good reference which can be used to speed up the process.

If you REALLY KNOW the check out will be fine and you’ve done a pre check out inspection. I’ve never done this but it comes to mind with loads of caveats , get a written agreement between you and the tenant that you can keep their deposit on return for helping them put a deposit down on the new property. As I say this has risks but if the tenant is as you say, and remains so. It may be a way over the new deposit if and only if the tenant doesn’t have the funds. This is a whole new subject on its own, risks, tenant relationship and ensuring the admin matches any risk.

You are looking for easy answers, the easiest is all parties are agreeable. However, you may need to think outside the box!

At the end of the day it’s about your gut feelings

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20

The government have changed the law and unfortunately you have to give 6 months notice irrelevant if what your tenancy agreement states. Unless your tenant is amenable and is willing to move out.