Selling a Residential Property that is Tenanted

Information Sheet: CPD Series 2011

Real Mastery believes that the content of these notes and checklists are accurate and current at the time of printing. Real Mastery
does not make any warranty of any kind, whatsoever expressed or implied, with respect to the contents. It is the responsibility of
the real estate professional using the notes and checklist to verify any information before relying on it.

Relates to the following sections of the Residential Tenancies Act of 2010 and Regulations 2010:
 Division 3 (Section 53-Sale of residential premises)
Learning Area:
 Legislation & Compliance
 Communications Skills
 Business Practices
 Sales Practices
  Marketing & Quality Control

The Act:
Division 3 (Section 53-Sale of residential premises) states-
(1) A landlord must give the tenant written notice of the landlord’s intention to sell the residential premises not
later than 14 days before the premises are first made available for inspection by prospective purchasers.
(2) A landlord or the agent of the landlord for the sale of the residential premises must make all reasonable efforts
to agree with the tenant as to the days and times when the residential premises are to be periodically available
for inspection by prospective purchasers.
(3) A tenant must not unreasonably refuse to agree to days and times when the residential premises are to be
periodically available for inspection by prospective purchasers.
(4) A tenant is not required to agree to the residential premises being available for inspection more than twice a
week.
(5) This section is a term of every residential tenancy agreement.

Section 100 of RTA Act 2010 - Early termination without compensation to landlord:
A tenant can break a fixed term tenancy agreement, without penalty, in the following circumstances:
the landlord has notified the tenant of the landlord’s intention to sell the residential premises and did not
disclose the proposed sale before entering into the residential tenancy agreement (see also section 26(2) of
the RTA 2010)

Key Notes:
There is a need for you to understand that these procedures are in accordance with the Legislation and
under no circumstances, other than having a signed off agreement with your tenants will you the Landlord
or the selling agent be able to waiver these regulations.

It is suggested that you meet with the Landlord and Selling agent to discuss these procedures so that all
parties have a clear understanding of the process.

More Facts:
 Premises by the time the sale is finalised. The landlord must give the tenant at least 30 days
written notice (after the contracts of sale have been entered into). This only applies after the
fixed term has ended.
Compensating Tenants
Tenants may ask for a rent reduction during the inspection period to compensate them for being
inconvenienced. It is up to the parties to negotiate what the amount (if any )discount might be. Some
landlords prefer to offer the tenant a cleaner for two hours ($40-$50 pw) rather than a rent reduction - a
win/win for tenants and landlord.

IMPORTANT QUESTION FOR PROPERTY MANAGERS TO ASK YOUR LANDLORD

Q : “do you have any intention to sell this property during the term on the lease”

Make a note in your file/software to records this and send a confirmation email

 In the event that your Landlord was to contact you shortly after a new tenant took possession,
instructing you to place the property on the market for sale – penalties will apply... including the fact
that the tenant would be well within their rights to vacate and seek compensation.

Landlord to Tenant Agent to Tenant

Date Date
Tenants Name: Dear [name]
Property Address: Address:

My name is XXX and I am the owner of the above We are writing to advise that the Owner of the property has
property. instructed us to market the property for sale.

As per the Residential Tenancy Act 2010 please be
advised and take this as the required 14 days notice that
I am going to market the above property for sale through
(insert your agency name).
The Agents will be in contact with you to arrange suitable
& convenient inspection times.
If you have any questions, please contact your Managing
Agent direct on (insert phone number)
Yours faithfully.
Please accept this as 14 days notice of our intention to
advertise the Property for sale via (Private Treaty / Auction).
Also please see Landlords notice attached.
We will be in touch with you to arrange suitable inspection
times.
We would also advise that our photographer and our sales
agent will require access to the property and should you
wish to remove any items that you do not wish to appear in
the photos, can you please ensure this is done in the next
couple of weeks.

Insert Landlords Name We appreciate your assistance in advance.

Cc Managing Agent if applicable With Compliments,

 Information for Tenants
Living in a Rental Property that is being SOLD

1 Agent arranges a pre-listing inspection

of the property with the Tenant in
9 Once a sale price has been agreed by
the Owner, the Contracts are exchanged
anticipation of the listing.
1
2 Property gets listed by Agent. Landlord
and Selling Agent notify the Tenant (in 10 Once Contracts are exchanged, the
Managing Agent/ Landlord gives the
writing) giving the Tenant the required 14
Tenant 30 days written notice and
days ‘clear’ notice before any marketing
advises the settlement date and the
commences. Ensure the Managing Agent
date the property must be vacated
receives a copy in, if not your office.

3 Agent and Tenant agree on inspection

times allowing for the required 48 hours
11 The Selling Agent should also advise
Tenant that the property has been sold
notice. (Agreements should be and the proposed date of settlement,
documented and signed by both parties) advising the tenant to contact their
Managing Agent for next steps. ( cc the
Managing Agent in if not your office) This

4 Tenant is required to prepare the

property for photography removing any
is not formal notice but just advising
them. Formal notice can only come from
Landlord or Managing Agent
items they do not wish to have
photographed and put on the internet

5 Tenant contacts the Agent to discuss 12 Tenant is required to provide access to

the Purchasers’ Valuer for the purpose of
securing another rental property valuation (48 hours notice is required)

6 Agent advertises and markets the

property 13 Tenant is required to provide access to
the Purchaser for a final inspection prior
to settlement

7 Agent conducts inspections (either

through Open for Inspections or By
Appointment)
14 Tenant vacates property ensuring they
have met the requirements of their
current lease in regards to cleaning,

8 During
rubbish removal, repairs and garden
this time, the Agent will contact maintenance (if applicable) in order to
the Tenant as some prospective get their bond back.
purchasers may wish to have building
and pest inspections completed, giving
48 hours notice