Selling Leased Premises

When landlords are attempting to sell a leased property, they still need to consider the rights of the tenants when arranging certain tasks. For example, an open inspection:

Landlords may assume that they automatically have the right to conduct open inspections for prospective owners, however, this does not exist.

In fact, the recent present set down in a Victorian Civil, and Administrative Tribunal stated that conducting open inspections was not permitted as it was classified a fishing expedition and thus disturbed the tenant’s right a quiet enjoyment. While landlords can show genuine buyers the premises, an open inspection would probably contain visitors who were not truly interested in a purchase and so did not count as genuine prospective buyers.

What can Landlords Do?

One of the only things a landlord can do is to ensure that any rental lease contract contains the right special conditions from the beginning of the leasing term. The landlord can also request permission from the tenant for the visitors to view the house, provided the agreement is in writing and 7 days before the entry is required.

Landlords also cannot make tenants leave until the end of a fixed-term residential lease contract, and they require 14 days’ notice that the property is being sold. Landlords should also consider the implications of selling a property already tenanted. Many buyers could find a tenant an inconvenience, and the presence of someone else living there results in the landlord losing control over how the property is presented.

For these reasons, many tenants and landlords to work out a deal for the duration of the sale period, for example, a reduction in rent on the condition that the tenant will keep the property presentable and vacated during the planned viewings. Landlords can also offer tenants free rent until the property is sold if they will move out before the end of a fixed-term lease. The most important aspect of selling a property that is already tenanted – is communication. The landlord and tenant are frequently able to come to some sort of arrangement that benefits them both.

If you want to sell your leased property, contact us today for professional advice regarding both yours and the tenant’s rights. As experienced property lawyers in Melbourne, we are capable of advising agents, landlords and tenants over all types of lease terms.

For more information and confidential advice, contact us today at P&B Law.

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