Have you ever settled a new purchase with a special condition subject to lease agreement in place?

Wondering if anyone on here has ever bought a property that was subject to tenancy?

A property I really want already has a tenant on a fixed term agreement, and vendor needs a short settlement as they need funds for their next purchase as they’ve already bought elsewhere.
Vendor is giving 60 days notice to the tenants, however vendor wants a 45 day settlement.
I’ve tried and tried to get vacant possession but the vendor will not budge, and I really want this one!

I’m worried about the risks (getting stuck with a tenant who may refuse to leave/trash the property etc), but it’s seeming like if I want the property I have no choice.

Has anyone ever bought and kept the previous owners tenant? The current rent is fine, but I could get $30-50 weekly more if I got a fresh lot of tenants in as these ones have been there for a few years.

Hoping to hear some good stories not horror stories!!

 

Are the tenants no longer on a fixed term lease?

 

One for your solicitor.
Check the lease (to ensure it is ok to terminate - if a fixed term early termination may NOT be possible).
Check correct notice to leave has been given by the vendor BEFORE signing the contract (or as a condition).

Then, if you really want the order property, close your eyes and cross your fingers.
Marg

 

Tenants are on a fixed term lease, I rang the PM currently managing the property and she said the minimum notice the owner can give them is 60 days.
Worst thing is my solicitor is closed til 8th jan now!
They do have an emergency email but not sure if this qualifies as an emergency

 

Most investors would be in this situation.

 

As part of the purchase, please ensure you get

- tenants application (from when they applied for the property)
- tenants ledger
- ingoing condition report

These are things you'll need to provide if it ends up with a bond or insurance claim.

Purchase property, inherit tenant. They've already been given notice.

If they leave when meant to, great. Go in and make the property nice and get professional photos done so you can advertise at 30-50 higher.

If they don't leave, you'll need to go the tribunal route to enforce the notice. This could take about 1-2 months (by time ya get a hearing, then the notice period the Member gives, etc). They'll still need to pay rent during that time and if they don't then that'll be where the bond/insurance covers you, along with any damage caused.

We keep trying to tell investors to calmly and systematically work through all situations. As long as you're doing the right thing, it all comes to fruition soon enough.

If you're going to own the property for 120 months (or more usually) it doesn't make sense to let the things from 1 month affect your journey. That's less than 1% for the sake of the remaining 99%.

 

There's 15 days between proposed settlement date and VP.

The vendor must wait 14 days to serve notice to complete. Then rebook settlement dates.

What's the penalty in the contract for interest on delays? Is it a default (like Qld)?

Weigh up what it will cost you to delay settlement.

 

Thanks for all the input. we went through again today, and the tenants actually seem pretty good. House is clean, no pets or kids, 3 adults. PM said rent has always been paid on time. I think its probably easier just to keep them in there.

 

Sounds like not much to worry about

 

I was just worried that we were taking on risk. But the more I think about its probably easier just to keep them anyway, even if I were to jack the rent up and put in new tenants, I still wouldnt break even after paying the mortgage myself during the vacancy, plus the cost of any upgrades I was planning to put in.

 

Do you think we should let the notice to vacate be served, but approach the tenants and invite them to sign a new lease with our PM and new rent price? Apparently the lady was hoping an investor would buy so they could stay?

 

In Vic, you can't give notice to leave just because the place is sold - if the fixed term lease is still in force, that is.

 

Thanks, I didn't know this, the agent and vendors PM told me they were serving 60 day notice to vacate. Will have to look into this further.

 

Ok will do. They have been there for a few years hence the bmv rent

 

Same in Queensland.
That is why I said it is important to check so you know where you stand.
Marg

 

I have previously purchased a property where i had a special condition put in place to be able to offer the current tennant a new lease agreement that would commence upon settlement and if the tenant did not agree wish to renew the lease agreement that the property would be made available to the property manager for the purpose of conducting open house rental inspections.

This was on a recent purchase in Kingswood NSW.