NaN% completed
how to sell a house with rental tenants

How do you sell a house with rental tenants?

October 25, 2018 8:00 am by Upside

If you’re selling real estate that also happens to be an investment property, it’s often made more complicated by having rental tenants living in the property. While it doesn’t have to be a deal-breaker to have people living in the house while you show prospective buyers, there are a few important things to look out for that can trip investors up:

Try to make the transition smooth

For many renters, one of the frustrating things is the lack of control over their living situation. As the landlord, it’s in your best interest to keep your tenants on your side so that the process will be as pain-free as possible and so that you can ensure that it’s generating returns for as long as possible. Some ways you can do this include:

  • Reduce the rent as compensation for the disruption of having open for inspections
  • Letting them know that you plan to sell as soon as you’ve made the decision
  • Communicate about the progress of the sale so they can make plans

Observe your tenants’ rights

While many landlords prefer to keep their tenants in place and paying rent as long as possible, others prefer to sell an empty property. Tenants’ rights vary by state, so it’s important to get real estate advice from an agent who is able to advise you on all the requirements so that you can be sure you’re observing the right laws. However, generally:

  • You can’t make your tenants leave if they’re on a fixed term lease
  • You need to give 14 days’ notice to vacate at the end of a fixed term lease
  • If ending a tenancy that has continued beyond the original term agreed, the notice period will be longer but varies considerably by state, so make sure you have up-to-date information.

Be prepared for your tenants to leave

In NSW and several other states, if you haven’t let your tenants know at the time of signing the lease that you intend to sell before the period of their lease is over, they are within their rights to leave when you let them know that you intend to sell the property.

Depending on your strategy and financial situation, you may prefer to sell a vacant property – but as we mentioned earlier, ensuring that you’re making money for as long as possible can be key. You don’t know how long it will take to find a buyer for your house and settle, so a vacant property can be a significant burden. Plus, selling an already tenanted investment property to another investor can be a big incentive to buyers.

So, if you want to keep your tenants in your rental property, be proactive and prepared to offer a deal like reduced rent so you can incentivise them to stay.

Tenants need to be given 24 hours’ notice of inspections

When it gets to the point of advertising the property to potential buyers, your tenants need to be given fair warning to be clear of the house and to have tidied up. This means tenants need to be given at least a day’s notice. Our tips for managing this smoothly:

  • Give more than 24 hours’ notice where possible to maintain a good relationship
  • Make sure you have a real agent with great organisation and communication skills
  • Consider only offering inspections at set times so that the tenants’ lives aren’t disrupted

If you’re planning to sell an investment property, it will be important to have an experienced guide. Get in touch with one of our professional real estate agents to help you understand your responsibilities and your tenants’ rights when it comes to selling a tenanted property.


Upside is an Australian-owned, full-service real estate agency with one low fee and no commission. Our standard is other agents’ ‘extras’, delivering vendors a complete agent managed service including a full appraisal, open home management, copywriting, photography, signage and advertising. It's the way real estate should be.

The market may be turning.
Find out the value of your property.

Get a free online property report from Upside.
It takes seconds.
Upside property report preview