Selling a property subject to an existing letting

Jeffrey Shaw

Member
Staff member
#1
1. The owner (V) can sell it as normal.
2. But clearly any prospective P will have to be told that internal inspection is either not allowed or needs T's advance consent.
3. The sale contract will state that V does not sell with vacant possession but subject to T's tenancy.
4. So that's similar to selling a freehold reversion (= subject to a long lease).
5. P will need to see a copy of the Letting Agreement.
6. On completion, P pays the balance completion money as normal.
7. But there's also an apportionment (allowance from V to P or extra payment from P to V).
8. That will depend on whether T has paid to V (as L) all rent up to:
a. a date short of the sale completion date; or
b. the exact sale completion date (inclusive); or
c. a date beyond the sale completion date.
9. On completion, P needs a Letter of Authority. This is from V (or V's solicitor), addressed to T, and tells T that thenceforth all rent is to be paid to P.