'Tenanted homes can be much more difficult to sell'

MANY investors attracted to the residential property market by the combination of low mortgage rates and soaring values in the past few years are now starting to think about reselling their investment properties.

And they should be aware, says Dr Piet Botha, chairman of the Nationlink estate agency group, that tenanted homes can be much more difficult to sell than an owner-occupied house or flat.

"Unfair it may be, but tenants generally have a bad reputation, and most buyers seeking a home for themselves will be reluctant to look at a property with a sitting tenant. In many cases, even those buying for further invest ment would prefer to find their own tenants."

And incumbent tenants who do not want to move can create major problems for the seller, he says. To start with, they may simply refuse to agree on any times for an agent to show the property, or perhaps deliberately leave the home in a mess when they know the agent is coming round with potential buyers.

"They might also regale potential buyers with every real or imagined fault in the property or neighbourhood."

He says landlords who have not made regular inspections may also come in for a nasty shock when it is time to sell because mainte nance has been neglected.

There may, of course, be no problem where tenants have been carefully selected from the outset, and Botha says that if the property has to be sold the best course is to first consult the existing tenants about whether they might wish to buy.