Kurralta Park RLA 176301 Blog

Deciding to sell your investment property is a significant decision that requires careful consideration. One factor that often comes into play is whether to sell the property while it is still tenanted or wait until the lease agreement expires. In this blog post, we will explore the pros and cons of selling your investment property while tenanted, helping you make an informed choice.

Pros:

1. Continuous Rental Income: One of the significant advantages of selling your investment property while it is still tenanted is that you can continue to receive rental income during the sales process. This can be especially beneficial if you rely on the rental income to cover expenses or if you want to avoid any financial gaps between tenants.

2. Attractive to Investors: Having a tenant in place can make your property more appealing to investors. Buyers who are looking for an investment property often prefer purchasing properties with established tenants, as it allows for immediate cash flow without the hassle of finding new tenants.

3. Less Vacancy and Maintenance Costs: By selling your property while it is still tenanted, you can avoid incurring additional costs related to vacancy and maintenance. With a tenant in place, you can minimise the downtime between tenants, reducing the financial burden of covering mortgage payments and other property expenses.

Cons:

1. Limited Access for Showings: When selling a tenanted property, you need to consider that potential buyers will need access to view the property. This can be challenging if the tenant is not cooperative or if their schedule does not align with potential buyers' preferences. Limited access for showings may impact the number of interested buyers and potentially prolong the sales process.

2. Limited Staging and Presentation Opportunities: Presenting your property in its best light is crucial when attracting potential buyers. However, when selling a tenanted property, you may have limited control over the presentation and staging aspects. The tenant's belongings and personal style may not align with your desired aesthetic, potentially impacting the property's appeal to prospective buyers.

3. Buyer's Restrictions: Selling a property with a tenant in place means that buyers will be subject to the existing lease agreement until its expiration. This can deter some buyers who may prefer to have the property vacant upon purchase. The lease terms, such as rental rates and lease duration, may influence a buyer's decision, potentially limiting the pool of interested buyers.

Deciding whether to sell your investment property while it is tenanted requires careful evaluation of the pros and cons. While selling with tenants in place can provide continuous rental income and attract investors, it may also present challenges such as limited access for showings and restrictions for potential buyers. Consider your specific circumstances, the tenant's cooperation, and your long-term investment goals when making this decision. Consulting with a real estate professional can provide valuable guidance throughout the process and help you navigate the complexities of selling a tenanted property successfully.