Buying a house with tenants NSW is not an uncommon practice. For some people, buying a house with tenants in NSW is an attractive option as it means they can receive money from rent after purchasing the property. Therefore, buyers do not always purchase an empty property. Some properties will have tenants, and some won’t. Additionally, buyers have two options when buying a house with tenants in NSW.
Firstly, vacant possession will enable buyers to purchase an empty property with its existing tenants moving out. Secondly, buyers can also purchase a property without the existing tenants moving out. As a result, the buyer will become the new landowner of the existing tenants. Regardless of the two options, it can complicate relationships between landowners and tenants.
Hence, it’s important for people buying a house with tenants in NSW to understand what steps to take in order to prevent possible disputes. Buyers should also know the conveyancing process which is the legal transfer of a property’s title to another person. This article will discuss how to buy a house with tenants in NSW.
Get to Know the Tenants
People who want to purchase a tenanted property will need to know about the current landowner-tenant agreement. Tenants can either agree on periodic or fixed-term agreements with their landowners. When a tenant rents a property for an indefinite period of time, it is subject to a periodic tenancy agreement.
Meanwhile, fixed-term agreements will require tenants to rent the property for a set period of time. Buyers should also get to know who the tenants are, and the kind of lease agreement in place. Lease agreements are binding contracts that outline the terms under which one party agrees to rent a property.
Another important thing for buyers to take note of is how they’ll manage the property and how much it will cost them. Buying a house with tenants in NSW will naturally require the buyer to know the tenants. In return, tenants will also want to know the new title holder. Here are the following questions that buyers can ask the tenants:
1. What they do for a living?
2. How much is their reported income?
3. How long have the tenants lived in the property?
4. Do they pay rent on time?
5. Have they caused any problems within the property (Not paying rent on time, Destroyed furniture inside the property, violation of rules and policies, etc).
Finding the right tenants is critical when it comes to investment properties. Buyers may discover that there are issues with payments, undue property damage, or lease breaches in the past. If this is the case, the buyers have the choice to terminate the lease agreement early.
Tips For Landowners Buying a House With Tenants NSW
Tenants are crucial to the success of real estate investments, especially for landowners. Without tenants, no one will pay rent and the title holders will lose money. Smart property investors understand this and always treat tenants with dignity and respect.
However, there are times when tenants will refuse to pay rent, trash the property, and even make unreasonable demands for items or services. Here are different tips for title holders who want to have an excellent relationship with their tenants.
1. Drafting Own Policies
Landowners may experience future problems if they don’t set policies for their tenants. Moreover, they should avoid making poorly written rules or policies before buying a house with tenants in NSW. While doing so, landowners should ensure they don’t violate any laws about basic tenants’ rights.
Landowners can include rules about allowing pets, hosting parties, and curfew hours. All of these may make their job easier for handling issues and enforcing their rights as a landowner. Tenants are less likely to challenge policies since they are more credible than verbal rules.
Who doesn’t love a good discount when it comes to renting a property? Discounts will definitely attract potential tenants to come and rent a property when it greatly helps their budget. When landowners promote good discounts, it encourages tenants to pay rent on time or maybe even earlier! This can also help in developing good landowner-tenant relationships.
3. Regular Maintenance
Tenants will always look at the property’s quality and living conditions. Title holders should make sure that pre-settlement inspections are carried out before buying a house with tenants in NSW. Pre-settlements inspections are one of the final steps in the conveyancing process. This ensures that the buyer bought the property with no changes (or further damages) in the property.
However, landowners should still make sure that they improve the property, even if it’s not in perfect condition. For instance, two tenants reported to their landowner that they have no water supply in the house due to damaged sinks. Good landowners will immediately hire plumbers who can easily fix the pipes so the tenants can have access to water.
4. Asking For Help From a Lawyer
Besides hiring a professional handyman for fixing utilities, it’s important that landowners seek legal advice in case they have a dispute with their tenants. Lawyers can explain the legal obligations of landowners if they are buying a house with tenants in NSW.
Not only will lawyers help them avoid any legal implications, but they will also help them draft a lease with a residential tenancy agreement. It’s entirely possible for landowners to research all of the related state laws and regulations. However, a lawyer can better explain important laws like the:
- Residential Tenancies Act 2010
- Residential Tenancies Regulation 2019
- Civil and Administrative Tribunal Act 2013
The conveyancing process can get complicated for buyers, especially when the property has tenants. JB Solicitors can help in buying a house with tenants in NSW for landowners who don’t want to go through hassles. Our conveyancing solicitors can also help with pre-settlement inspections and ensure that the property is ready for tenants who want to occupy it.
Do you need help in drafting legally binding policies for your property? Are you worried that some tenants might contest those policies? Whether it’s drafting documents for the property’s purchase, or making policies for the property, our lawyers can all do it for you for an affordable fixed fee. This helps potential landowners who want to get the best legal advice from our experienced lawyers.
Contact JB Solicitors today if you’re buying a house with tenants in NSW.