What Is A Sitting Tenant?

A sitting tenant (also called a tenant in situ) is someone who lives in a rental property when their landlord sells it. If there’s a tenancy agreement in place that hasn’t yet expired, the tenant has the legal right to stay, and the new owner becomes their landlord under the same terms as before.

In short, if a property is being taken over by a new landlord but there’s a tenant in place under a valid contract, then the terms can’t be changed.

The problem? Selling a property with a sitting tenant can be a little more difficult. Especially if their tenancy began before 1989.

If you’re looking to sell a property with a sitting tenant but are struggling to do so, get in touch with the team at Swift Capital today at enquiries@swiftcapital.co.uk to find out how we can help.

What Rights Do Sitting Tenants Have In The UK?

Sitting tenants aren’t just normal renters, they have specific rights that don’t change, even if a property is bought by someone else. However, these rights depend on the type of tenancy they have.

For example:

Modern tenancies (ASTs)

Most tenants in the UK today are on Assured Shorthold Tenancies (ASTs). These tenancies are usually set for a fixed period like 6 months or a year.

If you’re a sitting tenant with an AST, the good news is that your tenancy is still valid for the agreed time, even after the property is sold. The new owner simply steps in as your new landlord and has to honour the original agreement – same rent, same rules.

If landlords want to evict tenants under ASTs, they can issue a Section 21 notice, giving tenants at least two months’ notice to leave. It is worth noting that the government does have plans to scrap these “no-fault” evictions under the new Renters’ Rights Bill, but for now, landlords can still use them.

Older tenancies (pre-1989)

If your tenancy began before January 1989, you might be what’s called a protected or regulated tenant under the Rent Act 1977. In short, these tenants have something called security of tenure, which means they can stay in the property for as long as they want, and can even pass the tenancy on to family members in some cases.

They also pay “fair rent”, which is normally below the market rate and is set by a rent officer. These tenants are very well protected and can’t be evicted if they don’t want to be, even if the property is sold to someone else.

Sitting tenants have the same rights as other tenants, even if the property that they are living in changes hands.

How Long Before A Tenant Becomes A Sitting Tenant?

A tenant becomes a sitting tenant when the property they’re renting is sold and they continue to live in it under the previous tenancy agreement. The length of time they’ve lived in the property isn’t the deciding factor, it’s about whether the tenancy is still valid when the sale goes through.

So, even if you’ve only been living in the property for a few months, if the landlord decides to sell and you stay put, you become a sitting tenant.

Can You Evict A Sitting Tenant?

Yes you can, but not just because you bought the property.

If you’re looking to evict a tenant for any reason, whether they’re a sitting tenant or not, you’ll need to follow the same processes as any other landlord. That means issuing either a:

Section 21 notice – For AST tenants, giving them at least two months’ notice (as long as the tenancy is out of its fixed term, which is usually a minimum of 6 months).

Section 8 notice – If the tenant has broken the terms of the tenancy (like not paying rent or causing damage) then they can be evicted, even if it’s before the end of the fixed term.

However, if the tenancy is regulated or protected (pre-1989), evicting a sitting tenant becomes much harder. You can’t use Section 21, so it has to go through a full legal process, which can be long and expensive.

Can You Increase The Rent Of A Sitting Tenant?

Yes, but there are rules that you have to follow, though these are the same as other tenancies.

For ASTs, landlords can normally only increase rent:

At the end of a fixed term (if a new tenancy is agreed with a new rental amount).
If the tenancy agreement includes a rent review clause.
If landlord and tenant both agree to the rise.

For protected tenants (pre-1989), things are stricter and the laws are slightly different. Rent increases have to go through an official rent officer, and any rises can only happen every two years.

In short: yes, rent can go up – but you’ve got to do it by the same book as everyone else.

How Does Having A Sitting Tenant Affect The Price Of A Property?

A sitting tenant can decrease the value of a property, sometimes by quite a lot. Depending on the tenancy type, a property with a sitting tenant could sell for 20 – 40% less than if it were sold empty.

Why? Because new buyers have to inherit an agreement and a tenant that they didn’t choose.

It also makes it harder to get a mortgage. Lenders can be less willing to offer mortgages for properties with sitting tenants – especially protected ones.

Is It Harder To Sell A Property With A Sitting Tenant?

In general, it is harder to sell a property with a sitting tenant. This is because the market is much smaller (landlords only) and usually requires them to be a cash buyer due to the difficulty of securing a mortgage.

Not only that, but pre-1989 tenancies come with a lot of restrictions, which might be seen as less appealing to buyers.

Do Sitting Tenants Pay Rent?

Of course. Sitting tenants still have to follow their tenancy agreements, which means rent has to be paid as normal, both before and after the property is sold.

Once the new landlord takes over, the tenant should be told:

Where to pay rent (if it’s different from below).
Who to contact for any maintenance issues.
Where their deposit is protected (if this has changed).

If rent isn’t paid, landlords can issue a Section 8 notice to evict the tenants. However, they willl need to show evidence that the rent is at least over 2 months overdue.

Can A Sitting Tenant Refuse Viewings?

Yes, in some cases, they can.

Unless the tenancy agreement clearly says tenants have to allow viewings, they’re not legally bound to let estate agents or buyers in whenever they want.

Even if the agreement does include a viewings clause, landlords have to:

Give at least 24 hours’ notice.
Arrange viewings at reasonable times.
Get the tenant’s permission before entering the property.

In reality, most landlords try to give tenants plenty of notice and are respectful of their wishes. After all, a happy tenant is much more likely to work with you and let you in whenever you ask.

Do Sitting Tenants Have A Right To Buy?

No, they don’t have any special rights to buy, unless the property is owned by a public landlord (like a local authority or housing association) and the tenant qualifies under the Right to Buy scheme.

For private rentals, sitting tenants don’t have any special right to buy the property they live in. However, when they sell, some private landlords may offer the property to the sitting tenant first. This is known as “first refusal,” and can happen if the tenant has been there for a long time and expressed interest.

The Pros and Cons of Sitting Tenants

Sitting tenants are a big part of the UK rental and property market. And in reality, they’re governed by the same laws as other tenants.

However, understanding whether your tenant is under an AST or a protected tenancy is incredibly important for navigating the rules.

Whether you’re buying, selling, or renting, the main thing to know is this: tenancy agreements don’t just go away because a property is sold. A landlord not only inherits a property when they buy it, but also the rights and responsibilities that come with it – and sitting tenants are a part of that.

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