Buying a tenanted property as an owner-occupier can be a great opportunity, but there’s a little more to navigate. Lease agreements, tenant rights, legal notice periods, and financing quirks can all impact when (and how easily) you move in.
In this guide, we’ll break it down step by step and show you how Aussie’s tools and expert Buyer’s Agents make the process easier.
What’s inside
Lease agreements and tenant rights (and how they affect your move-in date)
Legal requirements for getting vacant possession
How buying a tenanted property can affect your home loan
Negotiation strategies to get vacant possession faster
Why working with an Aussie Buyer's Agent makes life easier
Tools to help you check your borrowing power, track your equity, and manage your homeownership journey all in one place.
Can you move in right away?
Understanding lease agreements
Before planning your move-in date, check what lease agreement the current tenants are on.
Fixed-term vs. Periodic leases
A lease agreement is a legally binding contract between the tenant and landlord (now you, as the new owner). Understanding the terms of this lease is key to knowing when you can take possession of the property.
Fixed-term lease (e.g. 6 or 12 months): Tenants have the legal right to stay until the lease ends, unless they agree to leave early (which might involve compensation).
Periodic lease (month-to-month): You can issue a notice to vacate, but timelines vary by state.
Legal notice periods by state
State | Notice period for periodic leases |
90 days | |
60 days | |
2 months post-settlement | |
Varies; check state regulations |
If you’re purchasing a property with a fixed-term lease, you may have to negotiate with the current tenant to leave early. This may involve offering financial compensation.
Your Aussie Buyer's Agent can review the lease for you and work out the soonest you can move in.
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Making sense of lease agreements with an Aussie Buyer's Agent:
Your Aussie Buyer's Agent can break down the fine print of any lease agreement, helping you understand exactly when you can expect to take possession of your new home.
They’ll work closely with tenants and property managers to explore early exit options where possible, whether that means negotiating a move-out date or offering compensation.
Inspection challenges: What to look out for
Unlike purchasing a vacant home where inspections are easy to schedule, tenanted properties require tenant cooperation for access.
Key inspection challenges:
Limited access: Tenants have legal rights, meaning you must provide proper notice (usually 24-48 hours) before an inspection.
Uncooperative tenants: Some tenants may not be motivated to present the home in its best condition or may deny access.
Hidden maintenance issues: Tenants may not report all maintenance problems, leading to unexpected repair costs later.
Essential inspections before purchase:
Building and pest inspection: Ensures structural integrity and identifies any pest infestations.
Electrical and plumbing checks: Confirms that systems are in good working condition.
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Streamlining inspections with an Aussie Buyer's Agent on your team:
Arranging inspections for a tenanted property can be tricky, but your Aussie Buyer's Agent has it covered. They coordinate directly with tenants and agents to lock in times that work, making sure you get the access you need for thorough inspections.
How buying a tenanted property affects your home loan
Lenders often see a tenanted property as an investment at least until you move in.
Financing considerations
May be classified as an investment loan, which can mean higher interest rates
Stricter lending criteria
To avoid this, loan pre-approval is essential to confirm eligibility for an owner-occupier loan.
With Aussie’s Borrowing Power Calculator, you can check how much you might borrow, and our expert brokers can help line up pre-approval and put you on a home loan that’s right for you.
You might also be interested in: Explained: What is home loan pre-approval?
Stamp duty and tax implications
First-home buyer stamp duty concessions: Generally, these still apply if you intend to live in the home.
Capital Gains Tax (CGT): If you rent the property before moving in, there may be CGT implications down the line.
Navigating home loans and costs:
While your Buyer’s Agent is focused on finding and negotiating the right property, an experienced mortgage broker is your go-to for sorting out the finance side of things.
If you’re planning to live in the property, your broker can make sure your home loan is structured properly from the get-go, helping you steer clear of higher investment loan rates and unnecessary costs.
Negotiating vacant possession
Can you request vacant possession before settlement?
Yes, but it requires careful negotiation. Some options include:
Asking the seller to provide vacant possession: The seller may arrange for the tenant to vacate before settlement.
Offering compensation: Paying the tenant to leave early can speed up the process.
Extending settlement: Aligning it with the end of the lease.
Understanding tenant rights and compensation risks
Tenants have rights, and if you push for early termination, they may be entitled to compensation. Always check state-specific tenancy laws before making agreements.
Securing vacant possessions with expert negotiation:
Getting the keys to a tenanted property sooner often comes down to negotiation, and that’s where your Aussie Buyer's Agent comes in.
They’ll handle discussions with the seller and tenant, working to secure a move-out agreement that fits your timeline while staying within tenancy laws.
If compensation is part of the deal, they’ll help craft a fair offer that works for everyone, keeping your costs manageable and the process stress-free.
You might also be interested in: Self-managing your rental property
Why working with an Aussie Buyer's Agent makes all the difference
From understanding complex lease agreements to negotiating vacant possession, Aussie Buyer's Agents are in your corner every step of the way.
Let an Aussie Buyer’s Agent handle the details, so you can focus on what matters most.