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The headache of buying a rented property


When you find a property to buy but the house is occupied by a tenant there is not much the new home owner can do but to wait for the lease to expire.
Regional Director of RE-MAX of Southern Africa, Adrian Goslett in a press release said that because the lease agreement is legally binding and was in place before, it stands regardless if the owner of the home decides to sell.
“The lease agreement goes with the home. Purchasing the home automatically makes the new owner a landlord. If the property is being bought as an investment or as part of a rental portfolio, the fact that the home is occupied might be seen as a drawcard. However, if the property has been purchased as a primary residence and the new owner intends to live there, it could be a problem.” For this reason, it is best for the buyer to go over the details of the lease agreement and see how long the tenant can stay in occupation before they decide whether it is worth their while to purchase the home, according to Goslett.
He noted that there is also the matter of brushing up on the legal rights and responsibilities of a landlord. There are respective obligations imposed on both the lessor and lessee in a lease agreement, so it is important for the purchaser to understand the implications of buying the home from the outset. “If there was a security deposit paid at the initiation of the tenancy, this will need to be refunded. The buyer must ensure that they get this money from the seller. Otherwise, they will find themselves out of pocket, Goslett explained.
If all goes according to plan, the new owner will only have to wait until the lease expires to move into their home pro­­vided that the tenant plays along and vacates the property when they are supposed to do so. “There are cases where the tenant has refused to move out, even after the lease agreement has run its course. Apart from having to deal with the delay, the new owner may also have to take legal action to have the tenant removed.” Before purchasing the property it is advisable to speak to the tenant and see what their intentions are, as this could save both time and money in the long run. A communicative, obliging tenant will make the process far smoother.