Tenancy ended during sale

Question from Ken updated on 29th April 2019:

I have an apartment in Auckland on which I have a contract for sale that is now unconditional. I had advised the tenant of the sale and he confirmed that he wished to have the tenancy transferred to the new owner. The contract was drawn up with the following Tenancy clause: Tenancies (If Any), Name of Tenant (blank), Bond (blank), Rent ($375), Term (Periodic), Right of renewal (blank).The tenant has now terminated the tenancy prior to settlement. What are my options?



Our expert Aaron Tunstall responded:

Normally on a Sale & Purchase agreement these details would be filled out completely and initialled by the vendor and purchaser. But in this case, with the exception of the rent amount, there are no further details provided about the tenancy. Typically the tenancy agreement would also be provided to the purchaser prior to signing the contract. Check that this was done. If the purchaser wanted vacant possession this would also be noted under tenancies (which they have not).

Make your solicitor aware of the above and also that the tenant has now provided notice presumably as per the requirements within the tenancy agreement. It is not uncommon for a tenant to provide notice or vacate while the sale of a property is in progress. Make sure everyone involved is aware and, depending on timing and with the purchaser’s permission, you may like to find a new tenant to limit any vacancy period for both vendor and purchaser.



Aaron Tunstall is the owner of Impression Real Estate, specializing in sales, building and property management.

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