Sell with tenants or empty house?

Discussion in 'The Buying & Selling Process' started by lettert, 10th Dec, 2019.

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  1. lettert

    lettert Well-Known Member

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    Has anyone sold property with tenants living in it and found the process reasonably easy? Were tenants co-operative in keeping house tidy, clean etc? We are thinking of doing this for a ppor-style house so it's important for potential buyers to love the house and be able to imagine themselves living there.

    The other option would be to sell the house right after it's empty - we could stage it and keep it clean, but the holding costs might add up, esp if the house doesn't sell at auction (it's an auction area) and takes some time to get to the desired price.
     
    Chris s likes this.
  2. TMNT

    TMNT Well-Known Member

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    thats big "it depends"

    most important thing is to find out what buyers want, if a buyer wants vacant, tenants no matter how good will only be a negative, and vice versa

    some tenants will actively help you sell the property,
    some tenants will actively sabotage your sale in order to stay, like it happened to me recently, my tenant deliberately told every prospective buyer that the house was falling down and that it was unliveable and even pointed out a crack in the brickwork by painting it a different colour!
     
  3. Westie

    Westie Well-Known Member

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    Wow! Special place in hell for people like that.
     
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  4. See Change

    See Change Well-Known Member

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    We've sold various properties with tenants in place and generally no issues . It makes it easier if you make it clear you'll try to sell to another investor. Occasionally things haven't been managed well and it does make it harder . It makes it much easier if the selling agent in also the managing agent .

    Worst tenant we've come across when we're buying ... Open bedroom door and a large vicious dog lunges at me .... tenants comment .. " lucky he didn't rip your throat out mate.... " . We didn't buy it . Place was relatively cheap ( obviously for a reason ) . My assumption is that someone who was up for a challenge would have low balled the owner , and then kicked the tenant out at the first opportunity , but I wasn't interested in buying something that was obviously problematic from the start .

    Cliff
     
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  5. The Y-man

    The Y-man Moderator Staff Member

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    I actually ask the tenants what the place is like when buying (they usually stick around to make sure nothing get's pilfered etc) - eg maintenance issues, what needs fixing, pros/cons of property - especially since they may be my tenants shortly!

    The Y-man
     
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  6. pinewood

    pinewood Well-Known Member

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    Can go either way. I've inspected homes that are tenanted which had dirty laundry strewn all over and food scraps and dishes piled in the sink and others where it was very presentable. I had tenants that didn't cooperate well with inspections and the place stank of stale air and again messy beds and laundry hung indoors. As you can't tell how they will leave the place during inspection, it's best to have them go and have the place staged if you want your home to look the best!
     
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  7. D.T.

    D.T. Specialist Property Manager Business Member

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    Selling without is much easier and has many benefits

    - Controlling home open times
    - Controlling the presentation of the home
    - Opening market pool / target audience up to owner occupiers rather than just investors
    - Loss of break-lease provisions in most states.
     
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  8. wylie

    wylie Moderator Staff Member

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    We had this happen and the tenants were both in real estate. They knew exactly what they were doing, clearly annoyed that we'd not listed with their agency. We ended up not selling, moved them on and sold a year later.

    I still get regular auto texts from this agent and would never, ever list with him.
     
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  9. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    If you do decide to sell with tenants in then I think you need to offer a weekly cleaner to come in and give the place a clean the day before home opens. This has 2 benefits, 1. that the place is clean and 2. it's a nice gesture to the tenant for having to put up with dealing with home opens. You might want to offer a garden service too so that the outside is weed free and nicely mown
     
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  10. balwoges

    balwoges Well-Known Member

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    Easier all round if the tenants are gone, as long as you have priced it right, present it as best you can and have confidence in your agent, it should sell reasonably quickly.
    You also have the benefit of it being available for someone looking for a home as well as investors - some home buyers could be put off thinking they may have to get rid of the tenants ... :)
     
    Last edited: 10th Dec, 2019
  11. Gockie

    Gockie Double boosted!! And still covid free. Premium Member

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    It's not too hard to sell while you Airbnb a property. I would just keep Friday nights blocked off for Saturday open homes.
     
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  12. kaibo

    kaibo Well-Known Member

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    Auction campaign you need to be all in with the marketing especially a PPOR style home. Tenants need to be out to present property in it's best light (I would nearly always recommend staging). Getting that one motivated extra bidder in the mix can really get you a lot more money!
     
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  13. Propin

    Propin Well-Known Member

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    I totally agree with Westminster! I had let two amazing tenants go on two properties I was selling and they didn't sell straight away. Went from a happy family home to empty.
     
  14. Big Daddy

    Big Daddy Well-Known Member

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    When I sold empty you have to factor in no rent plus vandalism. Copper pipes stolen on one, windows smashed on another.

    With tenants you have to deal with annoying the tenants, a potential messy house (depending on tenants) and potentially less buyers as some will want to move in straight away. Probably best would be periodic tenancy and give 60 days notice when property is unconditional.
     
  15. lettert

    lettert Well-Known Member

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    Hmm - seems a bit of a toss up, will probably stage and sell without tenants :)
     
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