The term tenant in situ refers to a situation where a tenant continues to occupy a property under an AST while the property is being sold.
The new owner will become the landlord while the tenant remains in the property, and their tenancy agreement will continue under the new ownership. This is a “sale with tenant in situ” or “tenanted property sale.” At the time of writing in April 2024 this has become a common scenario in the UK property market as many landlords look to sell up as a result of increased burden of taxation, legislation and mortgage rate increases.
Adavantages
- Guaranteed rental income: Investing in a property with tenants in situ means you will receive rental income from day one. There is no need to worry about finding new tenants or a period of vacancy, which could lead to a loss of income.
- No need for refurbishment: With tenants in situ, you won’t need to spend time or money on refurbishing the property before renting it out. This can save you a lot of money and hassle.
- Lower risk: Investing in a property with tenants in situ is less risky than investing in a property that is vacant. You won’t have to worry about finding new tenants or suffer financial loss due to a lack of rental income.
- Easier financing: Financing a property with tenants in situ is often easier than financing a vacant property. Lenders are more likely to approve lending on a buy-to-let property with tenants in situ due to the guaranteed rental income.
- Higher yields: Properties with tenants in situ often have higher yields than a similar property that is vacant. This is because you are receiving rental income from day one, without any period of vacancy.
Easily Sourcing Tenant In Situ Property For Sale
The UK Distressed Property List is now identifying properties for sale in the UK that come with a tenant in place and adding them to our weekly list organised by geographic location. We have noticed an uptick in these types of distressed sale in recent months as more and more landlords decide to sell up but it is still very easy to miss them as your trawl through hundreds of listings online.
How To Get The List?
We send the list out weekly by email to everyone who has signed up to receive it. So make sure you are signed up here to get immediate access.