What is a tenanted home?
A tenanted home can be a house or flat for which you own the freehold / leasehold but you rent out the property to tenants who pay you a monthly rent to live there. Tenants can be single occupants, couples, families, friends, or any other type of person who pays you to rent your home.
As the outright owner of the home you have the power to sell it whenever you want, but if you are content with your tenants and they are paying their rent on time you might want to keep that situation going as a nice way to earn some extra cash. And because the people renting your home might be living in it for many months or years, you want to know that they are the best tenants in terms of trust.
A happy tenant will keep your property in good condition and avoid any conflicts with you, whereas a bad tenant might miss payments, damage your home, or cause other problems. This can create issues that take a lot of time and money to resolve. In the worst-case scenario you might want to kick out a terrible tenant yet they could refuse to leave. This will require that you launch eviction proceedings which again will cost you significantly in time and money.
The guide below applies in particular to those people who own a property that they typically rent out to tenants, but that is currently unoccupied or where the existing tenants are moving out.
You’ll get invaluable advice on some of the important steps that you should take in searching for your next tenants, including how to go about pursuing a background check on potential tenants’ finances, meeting with them, taking your time to make a decision and more. This should boost your efforts to find tenants that will treat the home with respect and pay on time.
But you will also get suggestions on what to do if you find the process of trying to find new tenants overwhelming. One solution would be selling your flat or house, as Proptino UK says. And here you also have a number of potential options.
For example, you could sell the property to a quick buyer that has plenty of experience with purchasing formerly tenanted but currently empty homes, such as LDN Properties. You would not only get to complete the sale within weeks but you would also avoid paying any fees, and then you can decide at a later date whether to buy another property to rent out to tenants.
Some other methods for selling the property including using the services of an estate agent, trying your luck with a property auction or selling without any assistance, and you can learn about all of these strategies – including their benefits and drawbacks – later on in this guide.
How can I make sure I find the best tenants for my home?
Thankfully, you can typically narrow down the search for tenants from prospective applicants by reviewing various factors about each person. Consider the items on the list below as you assess potential tenants, because they can help identify good and bad candidates:
Pay for a background financial check
There are companies online, such as Experian, that offer special background check services for landlords through which they’ll give you a report on a tenant’s employment and credit history, and more. This can alert you to any potential problems with their character or financial past.
Take your time before choosing your tenants
If you rush the selection process then you risk overlooking an important piece of information about a potential problem with one of your applicants. Unless there is a pressing financial need to quickly approve someone, you should take your time and methodically review the applications to search for any warning signs.
Make sure that your tenant has steady employment
You should ask your prospective tenants whether they have a steady job, because they will only be able to pay your rent if they receive a regular wage. Seek tenants whose monthly income can easily cover the rent with plenty of money left over. And if your tenant is self-employed ask them for proof of their income before approving them.
Talk to them and do your own research online
It might sound simple, but having an in-depth interview conversation with a tenant candidate can be a great way to see whether you instinctively trust them and whether they say anything alarming. You should also search for them online, as their social media accounts and other results might alert you to any negative issues.
Prohibit tenants from having pets at your apartment
Some landlords will tell you the attribute they most want in a tenant is the ability to keep the home spotless. That’s why many landlords will prohibit tenants from having pets, because dogs, cats, and other animals can cause mess and damage your home. If neatness is your priority, the best tenant for you will be one that doesn’t have pets.
Look after your house or flat to keep your tenants content
When your tenants are happy, they are much more likely to keep your property clean and to pay their rent on time. Retaining good tenants is also partly the landlord’s responsibility because you need to respond quickly to any issues they raise, and provide whatever services you committed to in your rental agreement. An unhappy tenant is much more likely to cause negative issues at your property, whether that is through not cleaning the flat, not paying the rent, or any other adverse act.
Selling your property instead of trying to find new tenants
Whilst the information in the previous section can help in finding the best new tenants for your home, there are other options that will prevent having to go this potentially long process.
The main alternative is to simply sell your house or flat as is without any tenants, therefore as an empty property. This would this save you potentially a significant amount of time as you won’t have to search for people to live in the home, and you can instead move on to deciding which method to use to find a buyer.
Another advantage of selling your property instead of seeking new tenants is that you might also be able to save some money. Searching for tenants can create costs if you use paid advertising in local newspapers, online or elsewhere to try and find them, and this expense will increase the longer that it takes to secure new tenants. By opting instead to sell your property right away, you will not incur this cost – although you may face costs depending on how you decide to sell.
One ideal solution for selling in this scenario would be to get in touch with a no-commission quick home buyer like LDN Properties. These companies are experts at making fast and fair offers to buy almost any type of leasehold or freehold home, including tenanted homes and properties that used to have tenants but are currently empty. It’s a streamlined, no-hassle and stress-free way to sell within weeks and also prevent having to pay any commission.
You can find out more about selling to a quick home buyer, as well as your several other available options for selling your property, in the next section of this guide.
Your options for trying to sell a property that has tenants
If you are the owner of a property that you usually rent out to tenants but that is vacant, or the current tenants are planning on moving out, and you decide that you want to sell the house or flat instead of seeking new tenants, you will need to choose how to search for a buyer.
The four usual choices available are selling with an estate agent, selling at an auction, selling without any help or selling to a quick buyer such as LDN Properties. You will discover that all four choices have their own pros and cons in terms of whether you would have to pay commission on the sale, how long it will take before the exchange of contracts, and more.
You can read the specific elements of all four options below, and it might help to narrow down your choices by comparing the details of the methods against your top aims with selling – this can include how fast you want to sell, your ideal selling price, and other factors.
Selling with an estate agent
One of the longest-running ways to sell a property is by using the services of an estate agent. They will create a listing that describes your home and features photographs of the inside and outside, then advertise this in their office, online and in local newspapers to get buyers interested. Next, they’ll schedule viewings for people to tour your property, and hear offers. Finally, the estate agent will try to get a serious offer to the last stage of exchanging contracts.
Whilst this prevents you from having to put in much effort with the sale of your home, the downside is that you will need to pay the estate agent for all of this work if they manage to find a buyer for the property. This fee could be charged within a range of 1.15 percent to 1.40 percent of the home’s final sale price, although the exact rate could be higher or lower than this. And the fee will be subtracted immediately from the sale proceeds, adding to your selling costs.
You will find that selling this way is not the swiftest method, as it may take a number of months or even more than a full year to find a buyer. So if you are trying to sell as fast as feasible, review other options, such as selling to a quick buyer, as that should only take a few weeks.
And someone can make a true offer but then change their mind and withdraw it, which they can do without facing the risk of penalties if you have not yet exchanged contract. This would delay a sale much further because you would then need to start over with the process of trying to find a buyer for your flat or house, possibly extending the timeline by many more months.
Selling at an auction
When you auction a property, you choose a reserve price – the lowest value at which you can accept selling the home – and then people who are attending the auction get to place bids of increasing value on it. The highest price bid at the time the auction ends is deemed the winner and the person purchasing your home. Remember that such a bid is deemed a binding legal agreement to sell the property, and the buyer can sue to enforce the sale if you try to cancel it.
To help in calculating the reserve price, you should settle on a value that should still produce a profit from the auction even after paying the auctioneer their commission. If you don’t take this step, you might only just break even on the sale by selling at a price close to what you originally paid for the property, or you might even risk selling the home at a loss.
It’s useful to know that many auctioneers will charge commission at 2.5 percent of a property’s final auctions sale price, as Homeward Legal notes. This fee will increase your selling expenses because it will be taken out of the auction proceeds right away. Some auctioneers could be open to charging a lower rate or having the buyer pay a share of your costs, so ask if this is possible.
Auctioning a house or flat is also far from the fastest choice, as it involves a fair amount of waiting. After you opt for selling this way there will be many weeks or even months before the auction is held. And if the home sells, the buyer usually has about 28 days to complete all of their mandatory tasks needed to finalise the transaction, such as signing the legal documents.
Some auctioneers could be willing to set a tighter deadline for the buyer to do these steps, so you can ask if that is feasible, but note other auctioneers may allow even more than 28 days, which would result in an even lengthier schedule for completing the sale.
Selling without any help
One of the more potentially stressful ways to sell a property is by doing it on your own, which puts the burden on you to complete all of the tasks required to secure a buyer.
You’ll have to put together a listing, advertise it, schedule viewings, hear offers and try to get one through to the last stages of exchanging contracts and receiving the sale proceeds. This will take up a lot of your time and energy, and it’s only suggested for people that have sold a home before or have a suitably qualified friend or family member that can help them for free.
Even with such experience it might take a number of months or longer to get a genuine offer. And the buyer could still ultimately decide against purchasing your house or flat, cancelling the offer and making the sale collapse. You would then need to start again with trying to find another buyer for your home, which might prolong the selling timeline much further. And you can’t get any penalties from the person that rescinded the offer if contracts are not yet exchanged.
The only clear benefit of selling without any assistance is that it eliminates having to pay any commission to an auctioneer or an estate agent for finding a buyer, which reduces your selling costs. But it’s possible that any saving you make as a result is wiped out by the funds that you would have to spend on the various selling tasks, for example promoting your home’s listing.
Selling to a quick buyer
Or you could choose to sell your home to LDN Properties or another quick buyer that has the financial resources to purchase the property immediately. They don’t have to wait for weeks or months to first get approval for a mortgage to pay for the purchase, which reduces the timeline for completing a sale – including exchange of contracts – down to a handful of weeks.
Quick buyers are well known for making competitive and fast offers on almost all types of freehold and leasehold properties, no matter their age, condition, local, shape or size. That includes tenanted homes, whether or not the property currently has tenants living in it.
And you’ll get a fair offer even if the home has some problem that other buyers view as a dealbreaker, for example legal disputes, unpaid fines, structural damage and other scenarios. This means that you can proceed to selling the property and still get a decent offer for it, without having to spend any time, money or effort on fix any problems that it currently has.
The honest quick buyers like LDN Properties will also never charge you any commission when purchasing your flat or house, which helps you reduce your expenses. If you instead opt for selling via an auctioneer or an estate agent then you will need to pay them costly fees that will be deducted right away from the final sale proceeds, increasing your overall expenses.
Questions we’re often asked about finding the best tenants for your home
Because we buy many tenanted properties, we are used to homeowners asking us about how to find the best tenants. These are some of the answers we typically give them:
Yes. There are companies, for example Experian, that provide this service to landlords who want to run credit checks and other background reviews of people who are either their tenants or applying to be their tenants. But you should know that these services are not free and you’ll have to pay roughly £15 to £25 for obtaining these reports.
Because a happy and trustworthy tenant will cause you the least problems, as they will typically pay their rent on time every month whilst keeping your house or flat in good condition. In contrast, a bad tenant might deliberately damage your property, fail to make one or several rent payments, or otherwise cause you unnecessary problems.
There’s no reason to act too quickly, because if you make a decision too swiftly you risk choosing a tenant that you haven’t fully vetted and who could end up giving you significant problems. Unless you’re under major financial pressure to pick a tenant, it is better to take your time to thoroughly assess your various applicants.
If you do not have the interest in going the potentially expensive and lengthy work of finding new tenants for your property, you could instead consider trying to sell the home. Successfully selling the house or flat would then provide you with funds that you could then use in the future to buy another property to rent out to tenants, if that is something you want to do.
Generally, you should be able to choose from selling with an estate agent, selling on your own, selling at an auction or selling to a quick home buyer like LDN Properties. There are clear advantages and disadvantages to each of these selections based on important factors such as whether they charge any commission, the amount of time they take, and other issues.
No, you can prevent having to pay any fees on the sale of your home if you choose to sell either without any third-party help or if you get in touch with a no-commission quick home buyer such as LDN Properties. By contrast, if you choose to sell the property using an auctioneer or an estate agent, you will have to pay them fees that are taken out of the sale proceeds.
If you are looking to sell the home as fast as possible then you should consider getting in contact with a quick home buyer because these companies, like LDN Properties, can usually complete all the steps for purchasing a property within a few short weeks. Selling at an auction, via an estate agent or without any assistance can all take at least several months.
When you’re ready to sell your tenanted home, call LDN Properties
Whether you’re searching for tenants or already have your ideal renters living in your tenanted home, LDN Properties can buy the house or flat for cash at a competitive rate and without charging you any fees. Discover more about our no-stress and hassle-free process for buying properties by calling our team at 0207 183 3022 or reach us by clicking "Request Offer" below.
