Does it make sense to give tenants 2 years notice?

Does it make sense to give tenants 2 years notice?

14:38 PM, 24th May 2021, About 2 months ago 7

Text Size

I have a 2-bed flat which I have rented out to the same tenants since I bought it over nine years ago.

As I am now planning to make some changes to my (small) portfolio, I want to sell the flat early in 2023.

Does it make sense to give the tenants written notice of this now in order to give them plenty of time to find somewhere else and start making arrangements for their future too?

Many thanks.

Tricia



Comments

by The Forever Tenant

16:11 PM, 24th May 2021, About 2 months ago

It would think it nice to give your tenants as much warning as possible.
This has been their home for the past 9 years and it will be a horrible thought for them to lose that place.
You never know, it may be the case that the tenants are able to make arrangements to purchase the property directly from you when the time comes.

EDIT: Now I am assuming that they have been decent tenants for the past 9 years. If so, don't write, either call or visit them. Letters can be so impersonal.

by Mike

1:19 AM, 25th May 2021, About 2 months ago

Depends on your small changes, whether is it worth you selling it and be content with hard to find good settled tenants, end of the day you are receiving a regular income, it may not be as much as the going market rate, but even if it was 25% less than the going market rate then good tenants are worth their weight in gold.
Have you also thought about if you were to sell it, you would have to pay capital gains tax on the current value of the property minus the purchase price, and may be a few more bits of allowance, and in the end you don't get what you anticipated. so plan carefully.

I also planned similar move and gave my tenant 6Months notice, he has just left, but I had not anticipated CGT, and other expenses I will need to lay out on refurbishing the property to put it up for sale to get the best price, so I now regret as the tenant has found an alternative accommodation and has decided not to move back as he may have found a better place, or he may have been homed by the council in a council owned property. Oh well we all learn lessons as we go along.

by Freda Blogs

10:30 AM, 25th May 2021, About 2 months ago

Difficult one. Whilst it may seem attractive to have two years' notice, the moment your letter hits the doormat/your phone call is made regarding a possible sale, the tenants will be unsettled - their 'security' is removed and they may make a decision to leave at a time that does not suit your timescale. The dynamic of your relationship with them will likely change and may not be as pleasant as it is now.

Maybe just wait it out and time will bring a solution to you or perhaps ask the tenants in a roundabout way about their longer term plans and posture whether, if at some time in the future you were to sell, might they be interested in buying from you. They may not be in a position to do so, but perhaps they have relatives who could help.

by hpbennett

10:47 AM, 25th May 2021, About 2 months ago

Have you considered selling it as an investment, subject to and with the benefit of the tenancy? Obviously it depends on values in your area but it is worth investigating.

by DGM

13:43 PM, 25th May 2021, About 2 months ago

If you are considering selling as previously mentioned, let people know and sell with tenants in situ, I maybe interested, I have bought a flat with a sitting tenant previously and worked ok

by Trish

12:13 PM, 27th May 2021, About 2 months ago

Reply to the comment left by Freda Blogs at 25/05/2021 - 10:30
Thanks Freda, some good points

by Trish

12:15 PM, 27th May 2021, About 2 months ago

Reply to the comment left by Mike at 25/05/2021 - 01:19
Thanks Mike, yes I've sold a couple already and had to pay out to refurbish, and for CGT.


Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

BECOME A MEMBER