Sitting tenant

A sitting tenant also referred to as a tenant in situ, is someone who is already living in a property under a valid tenancy when the rental property is sold or transferred. The tenancy continues on the same terms and the buyer simply becomes the new landlord. The tenant does not have to move out because ownership has changed, their right to remain is governed by their tenancy agreement, not by who owns the property.

The two terms are used interchangeably in practice. "Sitting tenant" is the older legal term, more commonly used when discussing the tenant's rights and security of tenure. "Tenant in situ", meaning tenant in place, is the phrase more commonly used in property transactions, particularly in auction listings and agent particulars, to indicate that the property is being sold with an occupying tenant.

What does tenant in situ mean when buying?

When a property is listed as being sold with a tenant in situ, it means you are buying an occupied investment rather than a vacant property. The existing tenancy transfers to you automatically on completion, you become the landlord from day one, and the tenant's rights, rent level, deposit obligations, and all existing tenancy terms carry over unchanged. You cannot serve notice simply because you have just purchased the property; you must use the statutory grounds for possession available under the tenancy type if you wish to end the tenancy at some point.

Buying a property with a tenant in situ

Purchasing with a tenant in situ can be attractive to investor buyers who want rental income from completion without the cost and void of finding a new tenant. It can also mean a lower purchase price than with vacant possession, because the sitting tenant restricts what the buyer can do with the property immediately and some buyers will not consider occupied stock.

However, buying with a tenant in situ carries risks that require careful due diligence before exchange. The key questions to investigate are:

What type of tenancy is in place? An assured shorthold tenancy under the post-Renters' Rights Act periodic regime gives the tenant substantial protections. An older regulated tenancy under the Rent Act 1977 gives the tenant extremely strong security of tenure, a fair rent that may be well below market, and rights that can pass to family members, these are very difficult to end and can significantly affect value.

Is the tenancy deposit properly protected? The deposit must be held in an approved scheme and the prescribed information served correctly. As the new landlord you inherit the obligation to return or dispute the deposit at the end of the tenancy, so you need to verify protection status and take responsibility for the deposit at completion, usually by having it transferred to you with a formal acknowledgement.

Are there any rent arrears? Outstanding arrears belong to the previous landlord, not to you as buyer, but they are a signal of a difficult tenancy. Clarify the current payment position and request a rent statement.

Has the seller complied with all compliance obligations? A gas safety certificate, EICR, How to Rent guide, and EPC must have been provided to the tenant. As the new landlord you inherit the consequences of any non-compliance, which can affect your ability to serve notice and expose you to penalties.

Are there any outstanding repairs or disrepair claims? The property condition you inherit is the condition you are responsible for from day one. Get a full survey and check whether the tenant has raised any disrepair claims against the current owner.

Tenant in situ and the Renters' Rights Act

Under the Renters' Rights Act, all assured shorthold tenancies became periodic tenancies from 1 May 2026. A buyer purchasing with a tenant in situ after that date will always be taking on a periodic tenancy rather than a fixed-term one. Possession can only be sought on one of the statutory grounds for possession, there is no longer a straightforward no-fault route equivalent to the old Section 21. Buyers should factor this into their acquisition plans if they intend to refurbish, sell with vacant possession, or occupy the property themselves.

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