Tenants in situ - Pros and Cons please

[IceBoy]

Hi All,

Looking at purchasing a property which comprises of 3 apartments and all have tenants in situ.

To me this sounds like a great idea, ready made investment and income from day one.

Before I submit and offer, what are the disadvantages of this?

IceBoy

[BobbyA]

Tenants in situ can be a good buy as it means no void period and instant income.

However things to check,

What kind of Agreements are they on
Any previous rental arrears,
Condition of property / Outstanding repairs
Are deposits protected
Do all tenants have Right to Rent
Make sure you are aware of the current Section 21 conditions
Any agents involved currently.

.

[IceBoy]

Thanks Bobby,

Some great points there.

Iceboy

[vulture1]

Why is the seller selling?

[LFB531]

BobbyA said:

Tenants in situ can be a good buy as it means no void period and instant income.

However things to check,

What kind of Agreements are they on
Any previous rental arrears,
Condition of property / Outstanding repairs
Are deposits protected
Do all tenants have Right to Rent
Make sure you are aware of the current Section 21 conditions
Any agents involved currently.

.

^^^^^^^^^^^^^^^^^^^ All good point there.

I buy and sell a lot of these for Clients so a few more to add;

1. Is it standalone (so you're looking at the whole block)?
2. If so, you're going to need to check common parts (if any) are all up to spec in terms of fire and electrical safety.
3. Individual flat fire safety?
4. Any HMO's in there, licenses are not automatically transferred.
5. All flats will need valid Electrical Safety Certificates come end of March.
6. Gas safety, all up to date if fitted?
7. Check Local Authority licensing restrictions, some are creeping in for these. Housing Services will advise.
8. Energy Performance Certificates, all good and up to minimum standards?
9. Insurance, is it going to be easy? (Cladding, asbestos, build type etc)

Not exhaustive but a few more for the list. As has been said, often a really good LL option but more responsibilities than say three flats in separate blocks where you're only responsible for running your own space.

Good luck.

[IceBoy]

Thanks LFB.

I'm looking at purchasing the complete block (house converted legal in to 3 flats). I will own the freehold.

Thanks for the pointers!

IceBoy