The Residential Tenancies Act provides extensive detail relating to selling an investment property, with many of the requirements coming into effect on 29th March 2021, along with other major changes to the Residential Tenancies Act.
The order of steps taking place when a rented property is to be appraised, listed, marketed and sold must be followed in order to comply with legislation, both for the Rental Provider and the Real Estate Agent.
READ A SUMMARY OF CHANGES TO THE RTA LEGISLATION BELOW
Appraisal for the sale of a rented property
The Residential Tenancies Act does not specifically mention a right of entry to a rented property for the purpose of a sales appraisal, however, there is a right of access for “Valuation Purposes”.
When using the “Valuation Purposes” reason, the renter must be given at least 7 days' written notice of the entry.
Renter to be informed of the intention to sell
As soon as the agent is appointed, they should, on behalf of the Vendor/Rental Provider, notify the renter of their intention to sell. The Vendor/Rental provider should use the prescribed form, as outlined in the Act. This is important as there is no right of entry to show the property to prospective buyers until 14 days after the Notice of Intention to Sell has been given to the Renter.
Advertising images and videos
There is a right of access to the property to produce advertising images and videos, however, an array of compliance requirements must be adhered to as follows:
- At least 7 days written notice must be given
- There is no requirement for a notice of intention to sell to have been given
- There must be an attempt to agree with the renter on a suitable time
The renter may object in writing if the image or video shows possession of the Renter that:
- Identifies the Renter or another occupant
- Reveals sensitive information about the Renter or another occupant
- Is valuable and would increase the risk of theft
- Would be unreasonable to expect the Renter to remove or conceal
- May identify a resident at risk of family or personal violence
Can a notice to vacate be given to the renter?
The Renter is entitled to remain on the premises until the end of a fixed-term rental agreement if there is one, irrespective of the property being sold or offered for sale.
A notice to vacate can be given if the premises are to be sold, but only if:
- Immediately after the termination date, the premises are to be sold or offered for sale with vacant possession
- The Rental Provider has signed a conditional contract of sale and the notice is given within 14 days after the last condition in the contract has been satisfied
- The Rental Provider has signed an unconditional contract of sale and the notice is given within 14 days after the contract has been entered
- The termination is not less than 60 days after the notice is given
- The termination date is not before the end of a fixed-term if there is one
Documentary evidence supporting the reason must accompany the notice and must include one of the following:
- Contract of Sale signed by the Vendor and Purchaser and dated
- Contract of Engagement/Authority to Sell with a licensed agent
- A Contract of Sale prepared by a conveyancer or an Australian legal practitioner
The premises cannot be relet as a residence within 6 months after the notice is given by the Rental Provider who gave the notice.
Can the renter give notice of intention to vacate?
- After receiving a Notice of Intention to Sell the Renter may give notice of no less than 14 days of their intention to vacate, irrespective of the end date of the fixed term if there is one. However, they do not have a right to give such a notice if they had been informed before entering into the rental agreement of the intention to sell
- After receiving the notice to vacate the renter may give notice of no less than 14 days of their intention to vacate the premises, even if their intended vacate date is before the end of a fixed-term if there is one
If you have questions surrounding the sale of an investment property, please feel free to get in contact with our friendly team.
