Selling Renter-Occupied Properties

Your Legal Obligations: 

As a property owner, you must provide a Notice of Intention to Sell at least 14 days before commencing any sales-related activities. This notice should be accompanied by evidence of your intent to sell, such as a signed contract of sale or authority with a licensed estate agent. 

Once you have signed a contract of sale, and the contract stipulates that the purchaser requires settlement with vacant possession, you have 14 days from the date of signing to provide a Notice to Vacate to the renters. However, you cannot shorten a fixed-term lease agreement solely for the purpose of selling. 

For fixed-term leases, the notice period you provide to the renter regarding the vacate date should coincide with the lease end date. You should allow some time after this, such as 3 business days, for your settlement following the vacate. The renter can give you a return notice to vacate of 14 days at any time during the notice period. Eviction cannot occur during a fixed lease unless the lease terms are violated or both parties reach a mutual agreement. 

Considerations for Your Renters: 

When you put your property up for sale, your renters have specific rights. If they receive your Notice of Intention to Sell or a 60-day Notice to Vacate and the sale wasn't disclosed in their initial lease agreement, they have the right to serve a 14-day Notice to Vacate in return. 

You are required to compensate renters for inspections and sales-related appointments. The compensation is calculated as either $30 or half a day's rent per inspection, whichever is greater. For example, for properties rented at less than $420 per week, the compensation will be $30 per inspection. For properties over $420 per week, it will be equivalent to half a day's rent. 

You must give renters 24 hours' notice for inspections. While there is no cap on the number of inspections per week, respect your renters' right to quiet enjoyment of the property. 

Maintaining Positive Relationships: 

While selling your property is your right, consider the impact on your renters' lives. Providing as much notice as possible and being flexible with inspection times can help maintain a positive relationship. Open communication is key to a smooth process. 

Remember, if you issue a notice to vacate due to the sale, you must not re-let the premises for primarily residential use before the end of 6 months after the date on which notice was given, unless approved by VCAT. 

Tips for a Smooth Sale: 

1. Be kind to your renters and respect their space.  

2. Be mindful of their schedules when arranging inspections. 

3. Don't expect renters to move furniture or declutter extensively. 

4. Consider offering incentives for cooperation, such as reduced rent during peak inspection times or a positive reference for future rentals. 

Your Property Manager's Role: 

Your property manager can be an invaluable asset during this process. They can: 

- Act as a neutral intermediary between you and your renters 

- Ensure all legal requirements are met 

- Manage communications and coordinate inspections with sales agent 

- Provide expertise to maintain positive relationships 

Consult with your property manager early in the process to benefit from their experience and guidance. Their expertise can help you navigate potential challenges and ensure a smooth sale while maintaining good relations with your renters. 

By approaching the sale of your rented property with consideration and professionalism, you can achieve your goals while minimising stress for all parties involved. A well-managed sale process can lead to better outcomes for both you and your renters.