If you are a landlord who is selling a house or other residential property with sitting tenants, it is important to be aware of their rights and your obligations. If you are buying a property with sitting tenants, you also need to be aware of the tenants’ rights and the actions you need to take.
What rights does a tenant have when their landlord sells the property?
Your tenants should have a tenancy agreement with you, which gives them a legal interest in the property as a renter. If you are selling the house or flat your tenants live in, their rights are protected by law and cannot be curtailed, restricted, or changed by the landlord who purchases the property.
All conditions outlined in the tenancy agreement that the tenant had with the previous owner must be upheld by the new owner until the tenancy agreement expires.
The tenants’ rights continue for the duration of the fixed-term contract they had with you even if the ownership of the property they are living in changes. The new landlord is required by law to accommodate existing renters, but he or she is free to evict the tenants at any time by following the relevant eviction procedure.
Tenants are entitled to what is known as peaceful enjoyment, which essentially means they can deny access to anyone they do not want in the rented property - meaning both a current or new landlord cannot interrupt their time there or forcefully evict them. However, they are required to allow access with proper notice e.g. for viewings by potential buyers.
Can a landlord evict a tenant in order to sell the property?
Although the law is due to be changed, it is still possible, if a landlord wishes to sell a house or residential property, to evict a tenant under what is known as a section 21 notice, commonly known as a no-fault eviction. This law is taken from the Housing Act 1988.
In simple terms, this allows a landlord to evict a tenant without giving any reason, providing two months’ notice is given. This relates to assured shorthold tenancy agreements (AST), by far the most common tenancy agreements in England.
Further reading about the proposed end of no-fault evictions can be found on Parliament’s website.
In some cases, the buyer of a property will not want to complete the purchase until any sitting tenant(s) has been evicted, and in such situations, issuing section 21 notices when a landlord is selling a property is quite commonplace.
A landlord can also evict a tenant using what is known as a section 8 notice. However, in this situation, a reason has to be given, such as non-payment of rent.
Key things to do when buying a property with tenants
If you are buying a property with sitting tenants, it is essential to seek advice, and ensure that legal obligations are complied with.
As a new landlord, you are required to abide by the terms set out in the existing tenancy agreement. During the transfer period, you will also have additional obligations.
You are required to let your new tenants know which government-approved tenancy deposit scheme you have selected within 30 days. You are required by Section 3 of the Landlord and Tenant Act 1985 to provide your new tenants with your name, address, and contact information within two months of the ownership change.
A landlord cannot evict because the property has been sold or they want to sell it; instead, you must follow the correct procedure if you want the tenants to leave the property. If the correct procedure is not followed, it is considered an illegal eviction and is in fact a criminal offence.
Henriques Griffiths LLP are experts in landlord and tenant law, and are always on hand to advise on such matters. We also have extensive experience with property disputes of all types, helping clients with a wide range of sometimes complex and difficult situations. If you are buying a property with sitting tenants, we can help to ensure the process goes ahead smoothly.
Contact our landlord and tenant law solicitors in Bristol for advice on tenants’ rights when a landlord sells
For expert advice on any matters involving landlord and tenant law, property disputes and related matters, you can contact our friendly team at your local Henriques Griffiths office in Bristol or Winterbourne, or use our simple enquiry form to ask a question or request a call back.