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  • 'Buying' a tenant

    I'm looking to buy a property and want vacant possession in order to develop the site. If I settle BEFORE the tenant has actually left, what are my rights if the tenant DOESN'T leave on their due date?
    Jo Birch
    Looking for someone to manage your next project or event? Then call now!
    +61 450 148 678

  • #2
    Afternoon Heg.

    Originally posted by Heg View Post
    I'm looking to buy a property and want vacant possession in order to develop the site. If I settle BEFORE the tenant has actually left, what are my rights if the tenant DOESN'T leave on their due date?
    If you purchased asking for vacant possession and then took over before the agreed possession date Is not your vacant possession request now invalid?

    Will you be demolishing the exisiting rental and just using the land? If so, then the notice required for the tenant to move is 7 days.

    Keys
    www.3888444.co.nz
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    • #3
      I would have thought that vacant possession is just that, and that if its not vacant, you don't settle.

      Of course, the tenant needs to be given their 42 days....

      If you want to settle before the 42 days are up, how about withholding say $5K to ensure that it is in the vendor's interests that the tenant moves out?

      Originally posted by keys
      If so, then the notice required for the tenant to move is 7 days.
      Where is that in the RTA?

      cube
      DFTBA

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      • #4
        Originally posted by cube View Post

        Where is that in the RTA?

        cube
        S 59 (2)

        Keys

        (although that may be up for discussion)

        K
        Last edited by Keys; 07-11-2006, 06:03 PM.
        www.3888444.co.nz
        Facebook Page

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        • #5
          Originally posted by Keys View Post
          S 59 (2)

          Keys

          (although that may be up for discussion)

          K
          I believe this is a misinterpretation of s59.

          Destruction of the property relates to earthquake, landslip or some other unforeseen event, not the owner's bulldozing it to develop something else.

          Might be worth a try though, just to test it out at the TT.

          Anyone got a spare house they want to drive a bulldozer into?

          xris
          Last edited by xris; 08-11-2006, 07:59 AM.

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          • #6
            I just bought a property with a fixed term tenancy in place that I didn't want - I just paid them $1000 to surrender the lease early. Now I can get a tenant\buyer in paying more.
            We Buy Houses | Sell Your House Fast - No Fees, No Stress

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            • #7
              Originally posted by Cliffy View Post
              I just bought a property with a fixed term tenancy in place that I didn't want - I just paid them $1000 to surrender the lease early. Now I can get a tenant\buyer in paying more.
              Hi Grant,
              good idea, but -
              What weekly rent were they paying and how long did the term have to run? This one I am looking at is periodical. The landlord will give tenant notice when I go uncon but he wants settlement before tenant moves out......
              Jo Birch
              Looking for someone to manage your next project or event? Then call now!
              +61 450 148 678

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              • #8
                Originally posted by Heg
                What weekly rent were they paying and how long did the term have to run?
                Term was until May, $300pw.

                How long is the settlement he wants?

                If he gives 42 days notice when you go uncon, worse case you might have tenants for a couple of weeks?

                Sounds like he wants cash for something sooner? Can you find out exactly what he wants?
                We Buy Houses | Sell Your House Fast - No Fees, No Stress

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                • #9
                  Hello Jo,

                  If the contract has vacant possession and you then settle before the 42 days are up, aren't you both effectly agreeing to remove that condition of the sale? In that case wouldn't the 42 days notice be invalid? Then, wouldn't you then settle with tenants in place which you could only remove by giving 90 days notice?

                  I haven't really thought this through but it would be interesting to read what you think.

                  xris

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                  • #10
                    Well In my opinion the 42 day notice still stands.
                    But because ownership passed to the buyer before the 42 days was up then the buyer becomes the landlord.
                    Once the 42 days are up the buyer / owner can apply to the tribunal for a possession order.
                    Possession orders are given priority and so a tribunal hearing is given as soon as a slot is available.
                    Note this is an opinion and the tenancy adjudicator will also have an opinion.
                    I am sure you will need to supply a copy of the sale and purchase agreement at the tribunal.
                    There is really no difference here to taking ownership at the original purchase date and then getting rid of the occupant. Most people talk about the sale not proceeding if vacant possession is not available. I would have thought this would have only been one of the options the other being having the sale poceed and the buyer dealing with the "abandoned goods".
                    Natually there may be grounds for withholding some of the settlement money until full possession was possible. Withholding some of the settlement money is a very common practice.

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                    • #11
                      Jo,

                      Thinking about this again, how about this alternative idea which sounds better to me.

                      The 42 dats notice will still stand because the house has gone unconditional; it is irrelevant when settlement occurs. But unless details of the tenancy are made on the contract you are still entitled to vacant possession, which you will not get. But if you choose to settle early without vacant possession haven't you merely given up your right to claim for late settlement which you would otherwise have? You will become the new landlord on settlement (it's in the RTA) and have to oversee the end of the tenancy. You'd also have to deal with the vendor about transferring the bond to you. also potential problems if the tenants make a fuss when leaving: "No, the old landlord said it was alright to leave that compost heap at the back of the garden".

                      Is it worth all the hassle?

                      xris

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                      • #12
                        Originally posted by Glenn View Post
                        Well In my opinion the 42 day notice still stands.
                        .
                        Glenn,

                        I am not copying you - my second post with afterthoughts crossed with your post.

                        xris
                        Last edited by xris; 08-11-2006, 11:26 AM.

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                        • #13
                          LIke I said in my original post '" IF I settle before...."

                          The conditions are still being nutted out. This guy wants fast settlement for a lower price. My original offer was 'vacant possession' but this does not allow enough time to give tenants 42 days notice before settlement IF I agree to this earlier date.
                          Presumably,(as this is all looking a bit too difficult) I can just serve the tenants 90 days notice to leave when I take ownership?
                          Jo Birch
                          Looking for someone to manage your next project or event? Then call now!
                          +61 450 148 678

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                          • #14
                            Jo,

                            I was going to say: ‘What is the advantage to you in giving 90 days notice? You may as well have the vendor give 42 days notice on unconditional, that way you get them out earlier.

                            However I have just checked the RTA [s51(c)], about giving 42 days notice on unconditional.

                            “When the landlord has agreed to sell the premises and is required by the agreement to yield the premises to the purchaser with vacant possession.”

                            Perhaps the waters are muddied. You do not require vacant possession on settlement because you have agreed otherwise. There is not the vendor’s 42 day notice invalid? Perhaps my first idea above was closer to the mark than I later thought.

                            xris

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                            • #15
                              The whole point is this is one of those cases where the tenancy adjudicator can go either way.
                              It is not uncommon for the very same adjudicator to swing both ways in interpreting the RTA as they see fit. Surprising as it may seem they are not really answerable to anyone because the case can only go to appeal if the dispute is over $1000.
                              So bluff and hiss and roar is the order of the day.

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