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Landlord-to-landlord sale of tenanted properties booms under Covid

An estate agency that bucks the industry trend by selling only tenanted properties to landlords says it’s had a record year.

Portfolio, which specialises in selling homes with tenants remaining in situ, has just completed its third year of trading with annual revenue up 153 per cent.

The Edinburgh-based agency, which operates across Scotland, also recorded a sharp rise in the number of properties listed, while the seller leads it fielded were two-and-half times higher on the year.


Founders Chris Wood and Ross MacDonald say the increases point show the financial and logistical benefits of selling and buying tenanted properties.

They have revealed they aim to negotiate 60 sales for clients in 2021 - up from 30 sold in the past year - and say the signs for a good start to the New Year are strong.

The agency adds that the various bans on evictions during the Coronavirus crisis help their cause.

“One of the consequences of the Covid-19 pandemic has been that it has created greater interest and a wider realisation in the financial and logistical advantages that selling and buying properties with tenants in situ brings” says Wood, managing director of the business.

“However, even before that, we were seeing measurable increased recognition of these benefits - particularly the fact that this means no break in rental income for either party. Certainly though, circumstances have undoubtedly accelerated this awakening.”

Agents typically recommend buy to let properties are tenant-free before going to the market. But Portolio only sells from landlord to landlord, without the need for tenants to move.

The significance of the model has been thrown into sharp focus by emergency legislation introduced by the Scottish Government shortly after the Covid-19 outbreak began, which increased the notice period that landlords must give tenants from between one and three months to six months. This is due to remain in place until March 2021.

MacDonald, Portolio’s sales director, says: “In the current circumstances, the only way a landlord of a presently occupied property can quickly take that to market is with the tenant remaining in place. This also means that they do not lose rental income as the property sits empty.

“For investors buying the right properties at the right prices, the confidence of knowing you will immediately start to collect rent is a huge positive. This maximises cash-flow on both sides of the transaction and keeps costs down.

“For tenants, our model of working removes disruption because it keeps them in their homes, despite their landlord’s decision to sell.”

The agency says that in the landlord-to-landlord market especially, the use of the latest 3D technology means investors can buy a property without needing to view it in person, particularly relevant amid Covid-19 restrictions.

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  • George Dawes

    Scotland ?

    I suppose it's SO cold and wet most of the time to leave the house , so lockdown is a natural thing up there

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    The first few properties that I purchased came tenanted from an elderly landlord, it all started one day when my landlord came to see me to negotiate a rent increase on a small workshop that I rented from him, I asked him to sell it to me, over the next few yrs I bought 4 further properties from him, that was the mid to late 80s, and so the rest is history. I can see many landlord deals going forward as cash rich landlords buy stock from landlords having to reduce their debt .

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    Not something I would ever entertain. Trusting someone else’s compliance and potentially landing myself with a non-Housing Act tenancy and a sitting tenant? No way.
    I wouldn’t touch a tenanted property with a barge pole.

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    Nothing new about this its being going on for years, often at Auctions swapping portfolios around to suit their circumstances but one important detail omitted or left out here. Nearly all are Benefit LL's and Benefit Tenants it doesn't matter to them, not much point in getting rid of one lot of benefit Tenant to replace them with another and the whole thing is paid for by Government with very little restrictions, seldom or ever in the past at least were licensing required and often maintenance + grants / incentives thrown-in. All paid for by the working tax payer who can't afford much for himself and very unlikely to get any of their perks, like Children allowance if as couple earn over £50k pa, school meals, free uniforms, free or subsidized housing, a big cut in Council Tax, Nursery fees paid for, it a reward for not contributing or having to paying any tax. The Benefit LL & Tenant totally State funded and recession / lock down proofed.

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    I bough a property with a tenant in situ nearly 20 years ago - my solicitor was really concerned about lack of vacant possession but I guess now that is not an issue. I would be a bit concerned to do the same today, given the difficulties of eviction, but I can see how it works for many people.

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    I bought a property with tenants insitu.anouy 6 years ago. I asked LL to see passport numbers of tenants and gas certificate. He could produce neither. I went to speak to the tenants and told them I would need to see passports and I would have a gas certificate done. After I bought it I had new double glazing, new front door, a fridge freezer and microwave put in too. They stayed there for 4 years.

  • Matthew Payne

    At the moment it has to be considered a very high risk strategy even if landlord or agent can demonstrate there are no rent arrears, that could quickly change in weeks/months to follow. There is relatively little due dilligence you can do on a tenant in situe the same way you would if sourcing a new one yourself from scratch, and there will be potentially undisclosed correspondance/history between old landlord and tenant that could complicate matters further.


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