Is it possible to sell an already rented apartment with a regular lease?
Many times from our clients we are asked this question, there are in fact several reasons why the desire to sell a house arises even if it is rented: need for liquidity, change investment strategy, diversify the real estate portfolio.
The answer is yes, but there are some aspects to consider before putting the house up for sale, as the presence of a tenant is one of the constraints that can burden a property by conditioning its sale.
It is good to remember that it is precisely at this stage that the tenant can become your best ally or a valuable source of information if we continue to have a trusting relationship with him; on the contrary, he could turn out to be the worst enemy of the property owner who wants to sell the property, hindering any visits or keeping the house in poor condition and unsuitable for the visit of potential buyers.
Contrary to what one might think, the sale of a leased property does not result in the cancellation of the lease or rental agreement, but rather in its transfer to the buyer/new owner. In the words of the Civil Code, a conflict arises between the right of the purchaser of the property to the full enjoyment of it (1571 Civil Code) and the right of the tenant to continue to inhabit it. The rule is that the latter prevails, because of the primary importance that our legal system attaches to the right to a dwelling.
So know that there are no legal impediments related to the sale of an already leased property, the landlord can sell the leased property at any time and does not have to have the tenant's consent-you simply have to find an interested buyer under these conditions-but keep in mind that it is the tenant's right to continue living in the apartment until the contract expires, the only difference will be the change of landlord, who will become the new owner in case of sale to a third party. It is said in this case that "the lease is enforceable against the third party purchaser if it has a date certain prior to the alienation of the thing" (Art. 1599 Civil Code).
But selling to a new buyer is not the only option, because for the landlord there is the possibility of selling to the tenant himself, who in the meantime may have accrued the intention to buy the property in which he has been living for a long time on a lease, and in addition, in some cases, the tenant has a right of first refusal on the purchase of the property.
Let's look in detail at all possible cases.
As already anticipated, the owner can sell the leased property at any time with the obligation, however, to abide by the existing contract.
1. A property that is already leased may be more difficult to sell; it will be necessary to focus on buyers interested in an investment property for whom buying a property that is already occupied can mean a secure income without the burden of personally activating the tenant search.
2. To expand the number of potential buyers to include those looking for a house to live in the only possible solution is to vacate the property.
2.1 One option may be to seek a consensual and early termination of the lease: to do this, the advice is to maintain good relations with the tenant, informing him well in advance of the intention to sell and helping him to find a similar rental solution.
2.2 Another solution is to wait until the expiration of the contract before thinking about selling the property. Here we have two separate cases to analyze: the approach of the first expiration of a 4+4 or 3+2 contract and the approach of the final expiration of the contract. What changes?
At the first expiration of the lease, the landlord can sell the property and is not obliged to renew it when he or she does not own any other property for residential use besides the one leased and the one in which he or she resides: this is stipulated in Article 3 of Law No. 431/98.
In this case, the tenant always has the right of first refusal over other buyers, that is, preference over other buyers on equal terms. In this case, the right arises automatically according to the provisions of Articles 38 and 39 of Law 392/78 on the lease of urban real estate.
One obligation remains on the landlord: to give official notice to the tenant of his or her desire to sell the property six months in advance of the expiration date of the lease, stating within it the reasons why he or she intends to sell and an invitation for the tenant to exercise the right of first refusal.
The landlord must then promptly notify the tenant of the intention to sell the property and its price, and within 60 days of such notification, if interested, the tenant may exercise his or her right of first refusal by purchasing the property; otherwise the house is freely offered for sale.
There are some cases, however, in which the tenant will not be able to exercise the right of first refusal:
- Natural expiration of the contract (end of 5 years for 3+2 or 8 years for 4+4)
- the tenant owns other properties for residential use
- sale of the property to the spouse, relatives within the second degree or a co-heir of the landlord;
- in the case of involuntary transfers, transfer of the property to a company, or in the case of a block sale of an entire building.
2.3 The second case that arises is the desire to sell the property when the final expiration of the lease is approaching. In this case, however, the tenant will not have the right of first refusal unless it has been stipulated within the lease or by a separate covenant of first refusal.
3. Obviously, the easiest and most immediate route will be for the tenant to purchase the property, so we recommend giving the tenant early notice and communicating this intention, terms and price.
The main thing, however, is to maintain a relaxed and serene relationship with your tenants in order to sell quickly and without too many obstacles: a licensed, experienced and competent real estate agent will be able to guide you in this delicate process as well as in the subsequent negotiation phase. Knowing the situation, in fact, he or she could find both potential buyers and a new arrangement for your tenants, while also trying to reconcile the timing of entry/exit from the dwelling, avoiding considerable stress and accommodating all parties involved as much as possible.
If you would like to understand what is the way forward in your case, call us at our phone number 0583.997201 or write to us by filling out the form below.
