Since the introduction of the renter’s rights bill, we have seen more experienced landlords looking to sell their portfolios after yet more regulation and taxation changes making it more difficult to be a compliant landlord. But it is now more difficult to evict a tenant due to no fault of their own and the costs for having a property sat empty on Rightmove for a period can really mount up.

So, more landlords or selling their properties with a tenant in situ to avoid having to serve notice on them and incurring costs for having the property sit empty. This provides them with income right up until the point of completion and less headache.

We absolutely think so, if done correctly. If you are looking to buy a property with a tenant in situ, what should you look out for?

Buying a property with a tenant in situ will only be available for buy to let purposes. The reason being is that a residential lender requires vacant possession of the property on completion (Basically the property needs to be empty when you get the keys). Also, if the property is for you to live, why would you want to live with a stranger?!

Despite this, if you are buying a property with a tenant in situ it is likely for investment purposes yourself. So having a ready-made tenant can make your life a lot easier.

As you already have a paying tenant in place from the day you become the legal owner, you have income from day 1. You do not have a property sat empty whilst you look for a tenant.

Normally when a property is empty, the investor will refurb the property either with a lick of paint or a full refurb to get it fit for a tenant before they can put it on the market. If you already have a tenant in place, it’s likely that the property is in fit condition already otherwise you wouldn’t have bought it and the tenant would have moved out. This can save you valuable cash on a refurb job.

If the tenant has been in the property a while, its because they are happy there. The property will be in an area they want to be in that is close to work and their kid’s school. They have everything they need in the property and the rent is affordable for them. The longer they have been in the property the more settled they will be and the less likely they will be to leave.

Again, if they have lived in the property for a long time, they will have reported any issues to the previous landlord or management company and will have had them fixed. This can also work the opposite way as the longer they have been in the property the more wear and tear the property will experience so routine maintenance issues may crop up.

If a tenant fails to pay their rent the landlord can evict them. If the landlord has kept the tenant and the tenant has stayed long term, they will have built up a good track record of paying their rent which gives you confidence that will continue when you become the new owner.

A happy tenant who has lived in the property a long time, who is comfortable with the rent and had no issues with the property will be less likely to move out.

If these points have convinced you that buying with a tenant is for you, there are a few things you should do before you make an offer on the property.

Since the renter’s rights bill in May 2026, landlords can only increase rent once per year. If the last rent review was done 3 months ago, you cannot apply to change the rent for a further 9 months. Some less pro-active landlords have tenant paying the same rent they did 10 years without changing it despite rent rises.

So, the tenant in situ may be paying a rent way below the market average which lowers the returns on the investment.

If you require finance for the property in the form of a bridging loan or mortgage, the lenders require evidence of the rental income to support the loan. If the rent is too low, you may not be able to borrow the amount you need. Regular rent reviews and increasing the rent to match that of the market can help you with your finance needs.

Payment history is not a guarantee of future payment, but it can give you a good indicator. Now a landlord looking to sell you a property with a tenant in situ is not going to be overly honest if the tenant has missed payments in the past, because they want to sell you the property and do not want to put you off. But the managing agent will be able to tell you honestly if the tenant has a good track record of paying and paying on time.

Just like with the rental payments, the landlord will tell you that the tenant has been a saint and they have had no issues with them just so you buy it from them. But again, the managing agent fields the tenants calls if they have an issue so they can tell you if they have had any complaints or issues.

Managing agents inspect tenants’ properties regular and log their findings. Anything good or bad will be recorded so they can paint the picture to you about how the tenant has cared for the property.

Ask what type of tenancy the tenant is currently on

Some old type tenancies are not enforceable by law under current legislation or accepted by lenders. If you buy a property with a tenant in situ its best practice to rewrite the tenancy agreement to one that is legal today and protects you and the tenant but is also accepted by all lenders.

If you are the one selling a with a tenant in situ rather than an empty property, the downside is you have a reduced market to sell to. As we have discussed residential lenders require the property to be sold empty in order to meet their terms and conditions so selling a property with a tenant in situ eliminates any residential buyers.

You are limited to property investors buying with a buy to let mortgage or with cash which drastically cuts your target market.

If you are thinking of purchasing a property with a tenant in situ to add to your portfolio but need to run the numbers to make sure it works or need support with a buy to let mortgage please get in touch!

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