Selling a rental property is a significant decision, and there are many important factors to consider before moving forward.

Regardless of your reasons for selling, it’s crucial to understand the legal implications, especially if the property is occupied by tenants.

Scenario 1: Selling a Property with Tenants Who Have a Valid Lease Agreement

If your property is currently rented out under a valid lease agreement, it is important to know that the lease remains legally binding, even after the sale of the property. This principle is known in South African law as “huur gaat voor koop” meaning the lease survives the sale. The tenant has the right to remain in the property until the lease expires, and the seller cannot force an early eviction.

If You’re the Buyer:

  1. Review the lease agreement between the tenant and the current owner to fully understand its terms.
  2. Ensure the tenant’s deposit is transferred to you before the property transfer is concluded.

If You’re the Seller:

  1. Inform your tenants about the potential sale of the property as early as possible.
  2. Understand the legal standing of the lease agreement to avoid any surprises during the sale process.

Scenario 2: Selling a Property Occupied by Tenants Who Refuse to Leave

In some cases, tenants may refuse to vacate the property, even after the lease has ended, thereby becoming illegal occupants. Eviction in such cases can be a lengthy and challenging process.

In South Africa, every person has a constitutional right to adequate housing, which can make eviction a legally complex and time-consuming process — especially if the tenant has no alternative accommodation.

Tips for Landlords to avoid unwanted occupants:

  • Always have a valid and written lease agreement in place.
  • Communicate clearly and transparently with tenants about your intentions when selling a property.
  • Perform proper tenant screening, including credit and background checks, to minimize risk.
  • Keep detailed records of rent payments, correspondence, and agreements to protect yourself legally.

Final Thoughts

If you are considering selling your rental property, now or in the future, it is essential to consult with a qualified Conveyancing Attorney. They can guide you through the legalities and help ensure a smooth and compliant transaction.

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