Buying a Tenanted property is noticeably different than buying or owner occupied property or a vacant property and you’ll realize this before even getting to view the home. A tenanted property requires a 24 hour notice for showings and must take place between the hours of 8 a.m and 8 p.m as per the residential tenancies act. It’s distinctly different from a home presented for sale by the owner as the Tenant will be living there and does not necessarily have an interest in the sale of the property. It’s important to look past the Tenant’s belongings and to a lesser extent the cosmetic condition of the home This is where your quality realtor could stop in and help you understand what to look for and what to look past with certain concerns.
Once you get to the point of submitting an offer on a tenanted property, there is going to be certain clauses and conditions that you should include in your agreement. An important clause I would highlight, which is typically included in all agreements is the clause that binds the seller to provide vacant possession of the property on closing. More uniquely in this case, I would also include that the Seller provides a copy of either a N11 or N12, these two forms are officially tenancy ending. The N11 is a mutually agreed upon contract officially terminating the Tenancy and the N12 is a one sided document notifying the Tenants that you as a buyer will be moving in for personal use. In many cases I would even go as far as including a condition in the agreement that requests that the seller files either a L2 (for N12) or L3 (for N11) application for eviction immediately after the property has been sold to ensure minimal issues in an already complex situation. If these documents are not all in order in can be a potentially very challenging and cumbersome process. With cooperative Tenants the process can be very smooth, especially with the right forms completed and signed however with uncooperative Tenants unfortunately may not be the case. Please consult with a legal expert in residential Tenancy law before acting, as this is not formal legal advice.
Although it may seem a little overwhelming & challenging or even maybe a little complex, it’s really important to understand this because from a financial standpoint some of the best deals to be made on the market are in tenanted properties (sell below market value). Familiarize yourself with the rules, speak with a residential tenancy law expert, lawyer or paralegal and make sure you’re making an informed decision.