What Is A Sitting Tenant, And What Are Their Rights?

When it comes to property, sitting tenants can complicate things for both landlords and buyers. In this post, we’ll break down what a sitting tenant is, their rights, and how their presence can impact the buying or selling process. 

Whether you’re a landlord, buyer, or tenant, knowing the ins and outs of sitting tenancies can help you navigate your next steps with confidence. For further information regarding tenants and property law, contact Helix Law today.

What Is a Sitting Tenant?

A sitting tenant occupies a property under a specific type of tenancy that provides them significant protection against eviction and often includes the right to remain in the property for life, subject to payment of rent and compliance with the tenancy terms. These types of tenancies are governed by the Rent Act 1977 and impact tenancies granted before 15 January 1989. 

The act was introduced to provide greater security for tenants, capping rent increases and granting tenants the right to remain in their homes indefinitely as long as they followed the tenancy terms. It was part of a broader effort to protect tenants during a time of housing shortages and inflation. Because of these long-standing tenancies, sitting tenants often pay below-market rent.

Sitting tenants are also known as protected tenants because their rights are protected by law, making it difficult for new landlords to increase rent or evict them. The legal protection means that even when the property is sold, the sitting tenant has the right to remain in the property under the same terms, with the new property owner as their new landlord.

What Rights Do Sitting Tenants Have?

Sitting tenants have rights that go well above those of ordinary tenants, primarily from the Rent Act 1977. These rights include:

• Security of Tenure: Sitting tenants have the right to remain in the property indefinitely as long as they comply with the tenancy terms. The landlord can’t evict them without a valid reason, such as breach of contract or non-payment of rent.
• Rent Control: Rent for sitting tenants is often set below the market rate and can only be increased in line with strict legal guidelines. Landlords can’t simply raise the rent; any increase must comply with the Rent Act and be authorised by a Rent Officer.
• Succession Rights: In some cases, the tenancy can be passed on to a close family member who lived with the original tenant at the time of their death. This right of succession ensures that the property remains within the tenant’s family, extending the duration of the protected tenancy even further.
• Repairs and Maintenance: Sitting tenants have the right to expect that the property is maintained in a habitable condition. The landlord is responsible for necessary repairs, and tenants can request these be carried out if the property falls into disrepair.

Buying a Property With Sitting Tenants

Purchasing a property with sitting tenants in place can be both an opportunity and a challenge. Here’s what you need to consider:

• Rental Income: One advantage of buying a property with sitting tenants is the guaranteed rental income from day one. Since the tenants are already in place and very likely to stay in place, you won’t have to worry about finding new tenants or dealing with vacant periods.
• Lower Purchase Price: Properties with sitting tenants often sell for less than market value because the new owner will have limited control over the property. The rent may be significantly below market rates since the tenants’ rights restrict your ability to make changes or evict them.
• Long-Term Investment: If you’re looking for a long-term investment, a property with sitting tenants can be a stable asset. However, it’s essential to understand that your ability to increase rent or make substantial changes to the property will be restricted.

Before purchasing, you should thoroughly review the existing tenancy agreement, consult with a solicitor, and consider the long-term implications of inheriting a sitting tenant before proceeding.

Selling a Property With Sitting Tenants

Selling a property with sitting tenants can be far more complex and time-consuming than selling a vacant property. Here are your options:

Ask Your Tenants To Leave

If the tenancy agreement allows, you can ask your tenants to leave before you sell the property. You must give them the required notice period, and any eviction must comply with legal procedures. 

For standard, assured shorthold tenancies (ASTs), this usually involves serving a Section 21 notice for a no-fault eviction or a Section 8 notice if the tenant has breached the terms of the tenancy. Legislation is passing at present likely banning use of Section 21 notices in due course; care should therefore be taken to assess the law at the applicable time. 

However, since sitting tenants with protected status are not obligated to leave unless they choose to do so, this option completely relies on their willingness (or lack thereof) to comply with your request.

Sell With Tenant in Situ

Selling a property with a sitting tenant means selling it while the tenant still lives there. This option often means you are likely to sell for a lower price due to the limitations on the buyer, such as restricted rent increases and eviction difficulties. However, it can be attractive for buyers looking for a stable, long-term investment with guaranteed rental income.

Serve Notice On Your Tenants

You would be entitled to serve notice requesting possession of the property on a sitting tenant if they failed to comply with the tenancy terms. This notice must be in a prescribed form and provide the relevant notice period, which would be determined by the tenancy agreement. If the tenant does not leave by the end of the notice period, you would be entitled to issue court proceedings against them to obtain a possession order. This would allow you to instruct the bailiffs to remove them from the property.

Frequently Asked Questions

What Is a Tenant in Situ?

A sitting tenant is a tenant that occupies a property under a specific type of tenancy that provides them significant protection against eviction and often includes the right to remain in the property for life, subject to payment of rent and compliance with the tenancy terms. 

Can a Sitting Tenant Refuse Viewings?

Unless the tenancy agreement allows the landlord to access the property for this reason, a sitting tenant has the right to refuse viewings. While landlords usually try to arrange viewings at mutually convenient times, sitting tenants are within their rights to deny access, especially if they feel it disrupts their privacy or daily life. Landlords must respect these rights and should work with the tenant to find a solution. However, a tenant cannot refuse if the landlord requests access to carry out repairs. 

Does Having a Sitting Tenant Devalue a Property?

We are not expert valuers and valuation experts should always be instructed; just because there is a sitting tenant does not mean a property is automatically ‘cheap’, but in our experience yes, having a sitting tenant can devalue a property. This is primarily because the new owner will inherit the tenant’s rights and obligations, including rent control and security of tenure. The limited ability to increase rent or evict the tenant can reduce the property’s market value, often leading to a lower sale price. This should be checked on a case by case basis.

Final Thoughts

Whether you’re a landlord managing your property or a tenant living in one, sitting tenants come with their own set of challenges and protections. While these rights can complicate things for landlords, they provide long-term security for tenants. Navigating these situations requires careful consideration and a practical and commercial approach to achieve the best possible outcome.

Our property litigation team act nationally and deal with many complex property disputes, including disputes involving rent act protected or ‘sitting’ tenants, or their survivors. For tailored advice and support on dealing with these situations contact Helix Law. Our experienced team can guide you through the process and help you make informed decisions across all residential property disputes.