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Can a Landlord Sell the House While Renting?

September 13, 2022
can a landlord sell the house while renting

Long answer short, yes they can.

However, there are conditions to it.

Before you start frantically packing your bags and freaking out about being left homeless on the streets, let’s calm ourselves down and run through the entire situation together. From your rights as a tenant in a fixed-term agreement to what your landlord is allowed to do to how much notice the landlord can give the tenant to move out, we have got you covered.

It can be very frustrating and stressful when your landlord suddenly delivers the news that they are selling your rental property and you need to leave… soon.

This is a common situation that happens all the time, believe it or not. So fret not, not all hope is lost. As a tenant, the silver lining would be that you have rights that protect you.

Your rights differ depending on which state you live in though, so it is important to read up and seek advice from professionals regarding these specific laws.

So… let’s get into the nitty gritty bits of this entire situation.

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What can my landlord do?

can a landlord sell the house while renting

You must be thinking, ‘Is this even allowed?‘ or ‘I signed a residential tenancy agreement, how could they do this to me?‘. Those thoughts are completely normal for you to have.

Unfortunately, the straight answer is yes, this is actually allowed. Landlords can sell the property even while you are still renting it out. It sucks and we completely get that.

Here are some important things you should take note of if you are facing a similar issue in the future. It is good to prep yourself with this knowledge even if you aren’t in this situation at the moment too.

Your landlord is allowed to sell the property at any point in time

The bad news is: when you are a tenant, you can’t really predict your landlord’s intention when it comes to the property you are currently occupying.

They are legally allowed to sell the property at any time (this applies to all states in Australia). However, they are bound by certain restrictions and we will get to that later in the article.

It is well within your landlord’s right to put the property up for sale even with your current tenancy agreement still active. Your landlord owns the property, and most landlords usually rent out their properties for investment purposes.

This means that whenever they feel like the time is a good opportunity to sell their investment property, they do it without any hesitation. But they must give you a notice to vacate due to sale of the property within the time frame of the local state law as well as what’s indicated in your lease agreement.

Your landlord must give you ample notice before they hold open house inspections

Different states have different notice periods for landlords to inform you about an open house inspection. The notice periods and more information relating to the laws will be listed in detail later in the article.

When it comes to open houses, you as a tenant, are obligated to make all reasonable efforts to agree with your landlord on a suitable day and timing for the open house. You are also expected to keep the apartment in an acceptable state of cleanliness.

As a tenant in a fixed-term tenancy agreement, you also have the right to be present when the property is open for inspection.

What about the tenant in the fixed-term agreement?

When it comes to you, here are key pieces of information that you need to be aware of when it comes to your rental property.

Your lease is still valid

Even if the property goes onto the market, your lease agreement (also known as your tenancy agreement) is still very much active.

This also applies to the situation where the property is sold – your lease is still valid either way! This means that you do not need to vacate the property and move out immediately when the property is sold to a new owner.

One more thing to note: your landlord cannot terminate your fixed-term agreement for the sale of the rented premises.

The new owner undertakes your existing lease

When the new owner takes possession of the property, they also take on the existing lease agreement that comes with it.

If the new owner wants you to move out of the property, they still have to abide by the terms of your existing lease agreement. They would need to issue you a standard notice to vacate and this gives you time to sort out your next accommodation and move out.

You can terminate your existing fixed-term agreement

When there is mutual consent from both parties regarding the termination of your fixed-term lease, you can then terminate your tenancy agreement.

This is a great option to have if you have already settled on your next accommodation and want to end the tenancy agreement early.

You can terminate your fixed-term tenancy agreement in two scenarios:

  1. If your landlord did not inform you of their intention to sell the property before you signed the lease
  2. When you have received a notice of your landlord’s intention to sell the property

Once you have settled on ending the lease early, you can then issue your landlord a termination notice.

What about a tenant in a periodic agreement?

A periodic agreement means that your lease has expired but you are still living in the rental property and pay rent on a monthly basis.

If you are in a periodic agreement, you can leave without providing any reason. All you need to do is send an email to your property manager and inform them that you want to vacate the premises.

You do need to check with your state’s consumer affairs department on the required notice periods when it comes to terminating your periodic agreement.

Do I receive compensation?

Landlords actually do offer their tenants who are in a fixed agreement, compensation to vacate the rental premises as soon as possible.

So yes, you will receive compensation on the condition that your landlord wants you to leave their property. They usually offer compensation to also avoid complaints and compensate you for the inconvenience caused.

What say do I have during an open house inspection?

can a landlord sell the house while renting

As the existing tenant in your fixed agreement, you have a say regarding the photography of the property and the signage.

The external areas of the property can be photographed without your permission. But if the selling landlord wants to take photos inside the property, they will need to obtain your permission.

When it comes to the sale sign, any related signages and on-site auctions, you have to give consent before any of that takes place.

What happens to me once the property is sold?

can a landlord sell the house while renting

If your selling landlord does not terminate your agreement by the time the property is sold, the buyer becomes your new landlord when the settlement date comes into effect.

The terms of your lease will not be changed and your agreement will continue the same as before. More so if you are on a fixed-term lease, the new owner has to honour the terms in the agreement.

Your previous landlord or property manager will then contact you shortly after the handover and explain to you the new payment process to pay rent i.e. a new bank account number or a reference number.

If you still have any unanswered questions or find yourself in any circumstances where you do not know what to do, do not hesitate to contact your local tenants’ union.

What are the laws in each state?

can a landlord sell the house while renting

When your landlord decides to put their rented premises up for sale, it is perfectly normal for you to think that a lot will change when it comes to your stay as a tenant.

However, there are many legislations specially put in place to protect your rights as a tenant in this situation.

Let’s get into the laws from state to state as they all differ from one another.

In NSW

For rental properties in NSW:

Viewing notice

The landlord needs to offer you 14 days’ written notice before the first inspection.

After the first inspection, you can compromise on a suitable timeframe but no more than two viewings a week and the landlord has to give you 48 hours’ notice before each one.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

Your landlord can evict you but they need to give you 90 days’ notice.

OTHER

Your landlord must give you 30 days’ notice if they want to terminate your lease.

In VIC

For rental properties in VIC:

Viewing notice

Your landlord needs to give you at least 48 hours’ notice if they wish to show prospective buyers the property.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

Your landlord can evict you with 60 days’ written notice.

In WA

Viewing notice

Your landlord can only conduct house inspections between 8AM and 6PM on weekdays, or between 9AM and 5PM on a Saturday. They can only conduct inspections outside of these hours if you consent to it.

Before each rental inspection, your landlord needs to provide reasonable notice.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

If the contract specifically mentions handing over vacant premises, your selling landlord can evict you with 30 days’ written notice.

In QLD

For rental properties in QLD:

Viewing notice

Your property manager or landlord must give you an Entry Notice and at least 24 hours’ notice of the open house. A reasonable amount of time must have passed before conducting another.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

Your landlord can evict you on four weeks’ notice once a contract of sale has been signed with the new owner.

In SA

For rental properties in SA:

Viewing notice

Your landlord must give you 14 days’ notice before the property is advertised for sale and give you reasonable notice before each inspection.

The landlord has to specify a time between 8AM and 8PM on any day other than a Sunday or public holiday.

They cannot conduct more than two viewings every seven days, unless you have consented.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

Your landlord can evict you with a 60 days’ written notice if a contract of sale has been signed with the new owner.

Alternatively, they can also evict you on 90 days’ notice if no contract has been signed.

In TAS

For rental properties in TAS:

Viewing notice

If you give your landlord written permission, they can show prospective buyers your rental property at any point of time.

If you have not granted them permission, they can only conduct inspections between 8AM and 6PM, no more than once a day and no more than five times a week.

Your landlord has to provide you with 48 hours’ written notice before each inspection occurs.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

Your landlord can evict you on 42 days’ written notice.

In NT

For rental properties in NT:

Viewing notice

Your landlord must give you 24 hours’ notice before conducting an inspection.

Your landlord is only allowed to enter your property between 7AM and 9AM and they must be reasonable about the number of showings they are going to conduct.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

Your landlord can evict you on 42 days’ notice.

Other

Your landlord has to give you 14 days’ notice if they intend to terminate your lease on the end date noted in your tenancy agreement.

In ACT

For rental properties in ACT:

Viewing notice

The landlord has to give a minimum 24 hours’ notice before a prospective buyer can be shown around the rented premises.

You are obligated to give reasonable access to the premise but can refuse access if you were not informed of the landlord’s intention to sell.

Termination notice

You cannot be evicted by your old or new landlord if a fixed agreement is in place.

Unless you have mutual consent between you and the landlord or you violate your lease terms are you able to be evicted.

Periodic agreements

A landlord can evict you on eight weeks’ notice if they genuinely intend to sell the rented premises.

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