How to sell a let property

Do you want to sell your home and are you having problems with the tenant? Have you not, in the meantime, registered the lease?

Here is an outline opinion.

Let us suppose that a lease was signed between Mr Cesare and Mrs Cleopatra on 1 February 2006, expiring on 1 February 2010, and that the contract was renewed in 2011 and then in 2014. Let us also suppose that, on 20 January 2016, Mrs Cleopatra, the owner of the property, died, and that you succeeded her, as heir, in the contract. Finally, consider that in 2018 the contract was tacitly renewed for a further four years, and therefore until 2022, without anyone having registered the contract or transferred it. Subsequently, Mr Cesare, the tenant, expressed an interest in buying the property on the following terms: - payment of a modest deposit (€10,000); - setting future rent against the sale price.

Mevio has also shown an interest in buying the property. In this case too, however, on “particular” terms. How should you proceed? 1) First, you should avoid accepting the proposal of the tenant Cesare who, in the past, has already shown himself to be of limited solvency and often in arrears. Moreover, Cesare’s proposal involves payment of the overall sale price, fixed at €50,000.00, over more than ten years (given the provision for a truly modest rent). 2) You must nevertheless bear in mind that the lease has been tacitly renewed and that the tenant Cesare therefore retains a right of pre-emption on the purchase of the property. The consequence is that, if you decided to sell the property on the terms proposed by Mevio, you would still have to send Cesare a registered letter with acknowledgement of receipt to communicate the intention to sell and the terms of the sale. Without that letter Cesare could challenge the sale. 3) You must take into account that the terms of the second sale proposal (Mevio’s) do not appear legally “safe” (for you). In substance, you would part with an asset now against a promise of future payment. The consequence would be that you would then have to “chase” the new buyer and incur further expense.

The advice of Studio Legale LTC is therefore as follows: - regularise the position with the tax authorities (and therefore register the lease in your name and, if there are any, in the names of the other heirs), also so as to allow an eviction in the event of foreseeable future arrears by Cesare; - send, immediately and in any event no later than six months before the expiry of the lease, fixed at 1 February 2022, a registered letter to Cesare stating the intention not to renew the lease on its expiry (2022). Indeed, even if you found a new buyer, that buyer could not in any event “be rid of” the tenant before 2022, unless the tenant spontaneously decided to leave the dwelling; - communicate to Cesare (who retains the right of pre-emption) any terms of sale, so as to allow the right of pre-emption to be exercised; - in any event, it would be advisable for any sale to take place with immediate payment of the whole price.

Were we of help? If you have a problem similar to the one we have described, come and see us.