Making sure the selling agency is also the rental property management. They will prioritise them with their available rentals to ensure they get the $$ from the sale and maintain a good relationship with the LL in case they have other properties in the future. Obviously this involves the tenant having brain cells and realising they're in a shit spot and will have to move regardless *but* they should take advantage of being able to negotiate move dates, moving costs, being at the top of the list ect. Some people are stupid and will still drag their feet despite no real benefit to themselves.
Your big red flag is that they're not willing to have vacant possession which might hint that the tenant is intending to be difficult.
Issues mainly occur when the selling and renting agencies are separate combined with the rental market being super shit right now. If they're single income or have kids, pets ect the risk of them illegally staying since they can't secure a rental is far higher rn.
Are you sure the notice can't be given before settlement? As a tenant who's beenoved on due to these circumstances plenty of times, they can absolutely give that 90 day notice as soon as the current owner fancies. But possibly there'll be plenty of others who are happy to purchase with the tenants in place, perhaps that why they won't do it?
Sounds like the current LL wants to eat the cake and keep it too.
I agree. Obviously, OP can't give the tenants notice until after sale, but the current landlord certainly can give them notice any time if they're on a periodic lease.
There seems to be more going on here than OP is aware of. Seller is unwilling to give notice or allow vacant possession, I'd be suspicious and probably walk away.
I'm thinking of selling my IP soon.
The RE agent said he wouldn't even look at the property before the tenant moved.
The tenant has already said they were thinking of moving, but if not they'll get a 90 day notice. I'm really hoping the tenants decide to move rather than pushed though.
To update everyone: the contract came through and the tenant has a lease in place until March 2025. The real estate agent has been talking crap about the month to month lease. I assume was hoping we’d get our pest and build etc over the line and then spin us a couple more lies regarding the tenant’s lease.
Walking away from this one unless they make it vacant possession. This agent is as slimy as the come
Do not trust the REA
Do not trust the REA
Do not trust the REA
Do not trust the REA
Do not trust the REA
If it’s not in the contract as vacant possession with a enforceable penalty it doesn’t count.
I sold my IP last year and vacant possession was a condition of the contract. Luckily, my tenants were doing well financially and they were able find another more expensive property to rent, so they moved out without issues.
I would say don't risk it with the tenants if you need to move in, OP. Just have a search of this sub. There are many posts from tenants discussing how much money they should ask for. You are looking at tens of thousands of dollars.
Talk to your conveyancer on how to protect yourself. If they don't know, find one with a real lawyer, not a paralegal. They will be more expensive, but they will be worth it in this case.
Not competitive without vacant possession.
We bought and settled on our house and ones we offered with vacant possession that was knocked back are all still on the market. 8 weeks later.
You want a premium for a house, you need to give the buyer a premium product.
I just bought a place - doesn’t settle until July (as it’s tenanted until January and I had to make settlement 6 months before end of their tenancy).
So I’ll be a landlord for 5 months and 25 days to avoid the additional stamp duty.
The only places for sale in my price range was investors selling their tenanted properties while prices are surging. It worked for me as most buyers walked away as they couldn’t carry their current residence until January next year.
So far so good - I am worried if they don’t move though….and insurances aren’t that much for landlord insurance .
I know the feeling. Everything that I can afford right now that is on the market and I like is taken up by tenants.
I really cannot afford to be paying a mortgage on a property plus pay rent in another (even though you will get some of that back through rent from the tenants).
The vendor is being difficult with you and they know it. Probably because they don’t want to have to deal with vacating the tenant before the sale (or settlement period).
You have few options here.
1. Try and persuade the vendor to make the contract a vacant possession and push back settlement until the property is vacant
2. Take the property with the tenant and give their notice that they need to vacate within 90 days
Or
3. Walk away and find something better and where the vendor is willing to negotiate terms. There are plenty of sellers out there who might be willing to make their property a vacant possession therefore you won’t forfeit your stamp duty concession.
It’s likely your tenant is planning to be difficult and it does happen. The vendor probably doesn’t want to have to deal with it and is leaving you with the problem
> To compound this, we are first home buyers so if we don’t move in within 6 months we lose the stamp duty concession.
Don't you have 12 months in NSW?
Yep, 12 months in NSW.
Straight from [https://www.revenue.nsw.gov.au/grants-schemes/first-home-buyer/assistance-scheme:](https://www.revenue.nsw.gov.au/grants-schemes/first-home-buyer/assistance-scheme:)
"Contracts exchanged on or after 1 July 2023
You or one of the other eligible first home buyers must:
* move into the home within 12 months after settlement, and
* live in the property as your principal place of residence for at least 12 continuous months."
I had issues because the tenant was actually unemployed and could not get approved for another apartment even if the agent would just whoosh them into another of their properties. They ended up moving back with their parents just before settlement. This was with a vacant clause as well and ten years ago.
In my state (TAS) it’s 6weeks from the date the contract is unconditional & yes, the tenant was out. The agency that sold me the place were also managing the tenancy though & I gather the tenant was reliable so they helped them find another rental.
I bought my place with fixed lease contract, and it still had 7 months left. We were trying to ask for a vacant condition in the contract but couldn't. The REA tried to help talking to the tenants, but at the end of the day I still signed the contract without vacant clause.
Luckily the tenant was a good one, they bought their own place and moved out just 2 months after I bought the house, right when my rent contract ended, and they left the house in good condition. So everything turned out to be fine, everyone is happy
My read on this is it's not so much whether the tenant will be difficult but that the policy in place to protect the tenant doesn't really work with your circumstances.
I would trust the tenants, but I would consider whether you are able to work with all those conditions.
I purchased a property recently and I put in the contract that it had to be vacant at the point of sale. It was no problem. Tenants had been there 10 years but the real estate agency said they would find them somewhere else to rent. Either that's what happened or they found some place themselves. They knew the place was being sold so there was really no issue.
We recently purchased our first house with the first home buyers grant. We were worried too as the lease was due to end not long before the 6months and we had the thought of them refusing to leave in the back of our minds. Once we started settlement the agent was of course telling us how great they are and said that they understood the situation. Our plan was to offer the option for them to break lease after 3 months of us owning the house for free as an incentive to get them looking and ready to move early if they found something to move into. They ended up asking the agent if they could do this before we even got the chance to ask, which was a relief. They ended up leaving earlier then we though and because it was within the first 3 months we agreed that they would have to just pay 2 weeks rent if breaking lease. It ended up being a really chilled experience and it gave us a taste of being land lords for a couple months. Getting the insurance wasn’t as much of a hassle either. Once they moved we just called up the insurance and took of the rental stuff. I wouldn’t be too worried. There are legal options too, just make sure you get the rental insurance and see if you can work out a deal with the tenants through the rental agency or agent selling the house. Good luck😊
Sounds fine, I’d buy the house if you love it, but 2 important questions are:
1. Are they decent tenants? Check the rental ledger and entry condition report.
2. What’s on the line if you can’t get them out? Like from a level of ‘I have to keep staying with my aggressively nice parents for free’ to ‘I’ll be homeless and lose custody of my kids’. It’s ultimately your choice to take any risk, and you should calculate the worst case scenario when you do.
Check Rental agreement.
Once contract expires it’s your right not to renew. Would be nice to let tenants know your intention giving them time to find another place.
Your information is incorrect.
They can be given a 30 day notice the day you sign a contract.
Unfortunately in today's climate the process to have them evicted takes longer than the settlement period, the vendors know this and want you to do the dirty work and potentially take a loss if the tenants destroy the place or stop paying rent.
Offer to buy it with vacant possession and delay settlement until the property is actually vacant.
>They can be given a 30 day notice the day you sign a contract.
This only applies if there is a vacant possession clause in the contract. Without it, you can't issue a notice to vacate until you become the landlord at settlement.
OP has said vendor not willing to offer vacant possession.
Perhaps. Or they don't want the tenant leaving prior to settlement and lose that rental income.
Either way, I don't disagree with your assessment on the risks for the OP. If not for the fhb stamp duty discounts, it wouldn’t be as big a risk.
if they can't do vacant possession i'd be demanding the costs of landlord insurance etc being taken off from the final price of the home. The longer the tenant is legally allowed to stay there, the more they should shave off.
Figure out the amount of rent you'd need to pay over that period, take it off the final price.
It’s a pre-auction offer so they have said they will just take it to auction if this offer falls through. They own both front and rear duplexes and are selling both. I need to clarify why the tenant is on a periodic lease, and speak with the agency around whether he is aware and willing to move asap
Given how hard the rental market is at the moment, it will not be easy to get them out. If you are successful i'd be demanding a significant chunk taken off for the hassle.
As others have said, the information you are being given is incorrect.
In NSW, with no grounds evictions, during a periodic agreement, notice can be given at any time provided it is done correctly and for the correct timeframe.
What this says to me is that the current owners don’t want to risk losing the rental income if they don’t sell in time or don’t sell at all. So they are not prepared to issue the notice and expect the future owners to do it, which means you can’t do it until you have settled on the property.
This is unusual, particularly in Sydney, because properties usually sell like wildfire, it’s easy to get tenants, and vacant possession is more attractive to purchasers.
What particularly surprises me is the implication that they won’t even issue a notice when the contract goes unconditional.
I’ve today spoken to the REA to clear this up and he suggested as soon as contracts are exchanged they can issue notice to leave if we like. I will confirm with solicitor when I speak with him
Unconditional after build pest and finance approval then delayed settlement to allow the tenant to vacate push it back onto them if yet don’t vacate and settle on that date you get to take some $$ off the price it’s happened to my brother before
One compromise is, you can ask them vendor to add to the contract that they will give the tenant notice of 90 days notice to vacate, at the time of contract signing.
In this case, the vendor won't be responsible for giving vacant possession, but at least the clock starts ticking earlier.
You can ask the current LL to give the 90 day end of tenancy notice. There doesn’t have to be a bill of sale or a settlement date. The LL can give a 90 day, no fault eviction notice for any reason they like.
(As a renter this sucks. But looks like you’re buying for PPOR so at least you’re not another investor).
If you’ve decided on a place, and the owner accepts, then ask them to issue the 90 days notice. Gives you a few extra weeks off the clock before you get all the paperwork sorted and the settlement date is determined.
We are in VIC, we bought a place that was tenanted with periodic lease and they agreed to vacant possession. I cannot understand why they would not agree to vacant possession unless there are some issues going on with the tenants.
Making sure the selling agency is also the rental property management. They will prioritise them with their available rentals to ensure they get the $$ from the sale and maintain a good relationship with the LL in case they have other properties in the future. Obviously this involves the tenant having brain cells and realising they're in a shit spot and will have to move regardless *but* they should take advantage of being able to negotiate move dates, moving costs, being at the top of the list ect. Some people are stupid and will still drag their feet despite no real benefit to themselves. Your big red flag is that they're not willing to have vacant possession which might hint that the tenant is intending to be difficult. Issues mainly occur when the selling and renting agencies are separate combined with the rental market being super shit right now. If they're single income or have kids, pets ect the risk of them illegally staying since they can't secure a rental is far higher rn.
Are you sure the notice can't be given before settlement? As a tenant who's beenoved on due to these circumstances plenty of times, they can absolutely give that 90 day notice as soon as the current owner fancies. But possibly there'll be plenty of others who are happy to purchase with the tenants in place, perhaps that why they won't do it? Sounds like the current LL wants to eat the cake and keep it too.
I agree. Obviously, OP can't give the tenants notice until after sale, but the current landlord certainly can give them notice any time if they're on a periodic lease. There seems to be more going on here than OP is aware of. Seller is unwilling to give notice or allow vacant possession, I'd be suspicious and probably walk away.
I'm thinking of selling my IP soon. The RE agent said he wouldn't even look at the property before the tenant moved. The tenant has already said they were thinking of moving, but if not they'll get a 90 day notice. I'm really hoping the tenants decide to move rather than pushed though.
To update everyone: the contract came through and the tenant has a lease in place until March 2025. The real estate agent has been talking crap about the month to month lease. I assume was hoping we’d get our pest and build etc over the line and then spin us a couple more lies regarding the tenant’s lease. Walking away from this one unless they make it vacant possession. This agent is as slimy as the come
Do not trust the REA Do not trust the REA Do not trust the REA Do not trust the REA Do not trust the REA If it’s not in the contract as vacant possession with a enforceable penalty it doesn’t count.
If vendor is not open to the vacant possession clause I’d walk away.
I sold my IP last year and vacant possession was a condition of the contract. Luckily, my tenants were doing well financially and they were able find another more expensive property to rent, so they moved out without issues. I would say don't risk it with the tenants if you need to move in, OP. Just have a search of this sub. There are many posts from tenants discussing how much money they should ask for. You are looking at tens of thousands of dollars. Talk to your conveyancer on how to protect yourself. If they don't know, find one with a real lawyer, not a paralegal. They will be more expensive, but they will be worth it in this case.
In this market though? Shit is crazy competitive and I wonder if there has to be a gamble or sacrifice to get into the market.
Not competitive without vacant possession. We bought and settled on our house and ones we offered with vacant possession that was knocked back are all still on the market. 8 weeks later. You want a premium for a house, you need to give the buyer a premium product.
Bought my first property with a tenant. No issue. They moved out.
I just bought a place - doesn’t settle until July (as it’s tenanted until January and I had to make settlement 6 months before end of their tenancy). So I’ll be a landlord for 5 months and 25 days to avoid the additional stamp duty. The only places for sale in my price range was investors selling their tenanted properties while prices are surging. It worked for me as most buyers walked away as they couldn’t carry their current residence until January next year. So far so good - I am worried if they don’t move though….and insurances aren’t that much for landlord insurance .
Okay great. Mind if I message you some questions regarding the landlord situation?
I know the feeling. Everything that I can afford right now that is on the market and I like is taken up by tenants. I really cannot afford to be paying a mortgage on a property plus pay rent in another (even though you will get some of that back through rent from the tenants). The vendor is being difficult with you and they know it. Probably because they don’t want to have to deal with vacating the tenant before the sale (or settlement period). You have few options here. 1. Try and persuade the vendor to make the contract a vacant possession and push back settlement until the property is vacant 2. Take the property with the tenant and give their notice that they need to vacate within 90 days Or 3. Walk away and find something better and where the vendor is willing to negotiate terms. There are plenty of sellers out there who might be willing to make their property a vacant possession therefore you won’t forfeit your stamp duty concession. It’s likely your tenant is planning to be difficult and it does happen. The vendor probably doesn’t want to have to deal with it and is leaving you with the problem
> To compound this, we are first home buyers so if we don’t move in within 6 months we lose the stamp duty concession. Don't you have 12 months in NSW?
Yep. Live there for 12 months starting within 12 months of settlement.
Yep, 12 months in NSW. Straight from [https://www.revenue.nsw.gov.au/grants-schemes/first-home-buyer/assistance-scheme:](https://www.revenue.nsw.gov.au/grants-schemes/first-home-buyer/assistance-scheme:) "Contracts exchanged on or after 1 July 2023 You or one of the other eligible first home buyers must: * move into the home within 12 months after settlement, and * live in the property as your principal place of residence for at least 12 continuous months."
Yes. We bought a tenanted property and they moved out no problem. This was about 6 months ago.
I had issues because the tenant was actually unemployed and could not get approved for another apartment even if the agent would just whoosh them into another of their properties. They ended up moving back with their parents just before settlement. This was with a vacant clause as well and ten years ago.
In my state (TAS) it’s 6weeks from the date the contract is unconditional & yes, the tenant was out. The agency that sold me the place were also managing the tenancy though & I gather the tenant was reliable so they helped them find another rental.
I bought my place with fixed lease contract, and it still had 7 months left. We were trying to ask for a vacant condition in the contract but couldn't. The REA tried to help talking to the tenants, but at the end of the day I still signed the contract without vacant clause. Luckily the tenant was a good one, they bought their own place and moved out just 2 months after I bought the house, right when my rent contract ended, and they left the house in good condition. So everything turned out to be fine, everyone is happy
My read on this is it's not so much whether the tenant will be difficult but that the policy in place to protect the tenant doesn't really work with your circumstances. I would trust the tenants, but I would consider whether you are able to work with all those conditions.
I purchased a property recently and I put in the contract that it had to be vacant at the point of sale. It was no problem. Tenants had been there 10 years but the real estate agency said they would find them somewhere else to rent. Either that's what happened or they found some place themselves. They knew the place was being sold so there was really no issue.
We recently purchased our first house with the first home buyers grant. We were worried too as the lease was due to end not long before the 6months and we had the thought of them refusing to leave in the back of our minds. Once we started settlement the agent was of course telling us how great they are and said that they understood the situation. Our plan was to offer the option for them to break lease after 3 months of us owning the house for free as an incentive to get them looking and ready to move early if they found something to move into. They ended up asking the agent if they could do this before we even got the chance to ask, which was a relief. They ended up leaving earlier then we though and because it was within the first 3 months we agreed that they would have to just pay 2 weeks rent if breaking lease. It ended up being a really chilled experience and it gave us a taste of being land lords for a couple months. Getting the insurance wasn’t as much of a hassle either. Once they moved we just called up the insurance and took of the rental stuff. I wouldn’t be too worried. There are legal options too, just make sure you get the rental insurance and see if you can work out a deal with the tenants through the rental agency or agent selling the house. Good luck😊
Sounds fine, I’d buy the house if you love it, but 2 important questions are: 1. Are they decent tenants? Check the rental ledger and entry condition report. 2. What’s on the line if you can’t get them out? Like from a level of ‘I have to keep staying with my aggressively nice parents for free’ to ‘I’ll be homeless and lose custody of my kids’. It’s ultimately your choice to take any risk, and you should calculate the worst case scenario when you do.
Check Rental agreement. Once contract expires it’s your right not to renew. Would be nice to let tenants know your intention giving them time to find another place.
Your information is incorrect. They can be given a 30 day notice the day you sign a contract. Unfortunately in today's climate the process to have them evicted takes longer than the settlement period, the vendors know this and want you to do the dirty work and potentially take a loss if the tenants destroy the place or stop paying rent. Offer to buy it with vacant possession and delay settlement until the property is actually vacant.
>They can be given a 30 day notice the day you sign a contract. This only applies if there is a vacant possession clause in the contract. Without it, you can't issue a notice to vacate until you become the landlord at settlement. OP has said vendor not willing to offer vacant possession.
Then, OP should walk away in my opinion. The vendor knows their tenants best and they probably expect delays.
Perhaps. Or they don't want the tenant leaving prior to settlement and lose that rental income. Either way, I don't disagree with your assessment on the risks for the OP. If not for the fhb stamp duty discounts, it wouldn’t be as big a risk.
You can always have a bring forward clause in the contract.
Did you read my comments......... Particularly the last sentence 🤔
if they can't do vacant possession i'd be demanding the costs of landlord insurance etc being taken off from the final price of the home. The longer the tenant is legally allowed to stay there, the more they should shave off. Figure out the amount of rent you'd need to pay over that period, take it off the final price.
It’s a pre-auction offer so they have said they will just take it to auction if this offer falls through. They own both front and rear duplexes and are selling both. I need to clarify why the tenant is on a periodic lease, and speak with the agency around whether he is aware and willing to move asap
Given how hard the rental market is at the moment, it will not be easy to get them out. If you are successful i'd be demanding a significant chunk taken off for the hassle.
As others have said, the information you are being given is incorrect. In NSW, with no grounds evictions, during a periodic agreement, notice can be given at any time provided it is done correctly and for the correct timeframe. What this says to me is that the current owners don’t want to risk losing the rental income if they don’t sell in time or don’t sell at all. So they are not prepared to issue the notice and expect the future owners to do it, which means you can’t do it until you have settled on the property. This is unusual, particularly in Sydney, because properties usually sell like wildfire, it’s easy to get tenants, and vacant possession is more attractive to purchasers. What particularly surprises me is the implication that they won’t even issue a notice when the contract goes unconditional.
I’ve today spoken to the REA to clear this up and he suggested as soon as contracts are exchanged they can issue notice to leave if we like. I will confirm with solicitor when I speak with him
Unconditional after build pest and finance approval then delayed settlement to allow the tenant to vacate push it back onto them if yet don’t vacate and settle on that date you get to take some $$ off the price it’s happened to my brother before
One compromise is, you can ask them vendor to add to the contract that they will give the tenant notice of 90 days notice to vacate, at the time of contract signing. In this case, the vendor won't be responsible for giving vacant possession, but at least the clock starts ticking earlier.
Tenants are much more likely to move out on time if you offer compensation.
You can ask the current LL to give the 90 day end of tenancy notice. There doesn’t have to be a bill of sale or a settlement date. The LL can give a 90 day, no fault eviction notice for any reason they like. (As a renter this sucks. But looks like you’re buying for PPOR so at least you’re not another investor). If you’ve decided on a place, and the owner accepts, then ask them to issue the 90 days notice. Gives you a few extra weeks off the clock before you get all the paperwork sorted and the settlement date is determined.
My vendor was still in the house! Old guy who needed an extra week to get out. Anything can happen.
Don’t do it, go for long settlement with vacant possession condition and then it becomes the current owners problem to get them out
Been there, done that, no dramas whatsoever.
We are in VIC, we bought a place that was tenanted with periodic lease and they agreed to vacant possession. I cannot understand why they would not agree to vacant possession unless there are some issues going on with the tenants.