Selling With Tenant In Situ: What Landlords Need to Know

Selling a tenanted property is increasingly common — and increasingly complex under the Renters' Rights Act. This article covers what you need to know before you instruct an agent.

The Two Routes

When you decide to sell, you have two options:

1. Sell with the tenant in situ — the tenant stays, the buyer takes on the tenancy

2. Sell with vacant possession — you recover possession first, then sell

The right choice depends on your buyer pool, the tenant's cooperation, and the local market.

Selling With Tenant In Situ

This is the simpler route legally. The tenancy continues through the sale and the buyer becomes the new landlord on completion.

*Advantages:*

- Rental income continues until completion

- No possession proceedings required

- Attractive to buy-to-let investors wanting immediate income

*Disadvantages:*

- Typically achieves 10–20% below vacant possession value

- Limits your buyer pool to investors — owner-occupiers cannot purchase

- Viewings require the tenant's cooperation (24 hours' notice required)

- The tenant may be uncooperative or present the property poorly

*What must happen on completion:*

- The deposit must be transferred to the buyer and re-protected in a new scheme within 30 days

- The tenant must be notified of the new landlord's name and address within 2 months

- All tenancy documents (agreement, inventory, compliance certificates) must be handed to the buyer

Selling With Vacant Possession

Under the Renters' Rights Act (in force from 1 May 2026), Section 21 no-fault eviction is abolished. To recover possession for sale, you must use Section 8 and rely on a specific ground.

*Ground 1A — Landlord Intends to Sell:*

- New mandatory ground introduced by the RRA

- You must genuinely intend to sell the property

- Notice period: 4 months

- Cannot be used within the first 12 months of the tenancy

- If you do not sell within 3 months of vacant possession, the tenant may have a claim for compensation

*The process:*

1. Instruct an estate agent and obtain a valuation (keep evidence of your intention to sell)

2. Serve a Section 8 notice on the prescribed form specifying Ground 1A

3. If the tenant does not vacate by the notice expiry date, apply to the court for a possession order

4. The court must grant possession if Ground 1A is proved

Viewings During a Tenancy

Whether selling tenanted or vacant, if the tenant is still in occupation during the marketing period:

- Give at least 24 hours' written notice before each viewing

- Viewings must be at reasonable times

- You cannot enter without the tenant's consent — even during a sale

- Consider offering a rent reduction in exchange for cooperation with viewings

Disclosure to Buyers

When selling a tenanted property, you must disclose:

- The existence and terms of the tenancy

- Any rent arrears or disputes

- The deposit amount and which scheme it is protected in

- Any notices served (Section 8, Section 13)

- Any known defects or compliance issues

Failure to disclose material facts can give the buyer grounds to rescind the contract or claim damages.

⚠️ Legal Accuracy Note

Ground 1A notice periods and the 3-month re-letting restriction reflect the Renters' Rights Act as in force from 1 May 2026. Always verify the current prescribed form (Form 3) before serving notice — the form is updated periodically by MHCLG.