Buying a tenanted property means buying income from day one, and it also means buying the tenancy’s entire history: the deposit as it was handled, the certificates as they were served, and the paperwork as it was done or not done. The rent starts on completion day. So does the liability.
This checklist covers what must change hands when you buy with tenants in situ, current as of 1 August 2026, and the order to demand it in.
Buying tenanted means buying history
The tenancy agreement survives the sale. Its rent, its terms and its history all continue against you as the new landlord, and nothing about completion resets them. Read the actual signed agreement, not a summary, and check the rent being claimed matches the rent in the document and the rent actually arriving in the seller’s bank statements.
Verify the human facts too. Who lives there, whether the named tenant still does, and whether anyone else has moved in. A tenancy schedule is a seller’s claim. Bank statements and a managing agent’s ledger are evidence, and the difference between the two is where tenanted purchases go wrong.
The deposit is the first trap
Deposits taken on assured tenancies must be protected in an authorised scheme within 30 days, with prescribed information served, and the penalty regime allows a court to award tenants up to three times the deposit where that failed. When you buy, the safest assumption is that you inherit the consequences of a mishandled deposit along with the tenancy.
So make the deposit a completion item. Require evidence of protection and the prescribed information as served, confirm which scheme holds the money, and agree in contract how the deposit transfers to you or your agent on completion. If the seller cannot evidence protection, price the statutory exposure into the deal or require it to be resolved before exchange.
Certificates that must change hands
Four documents should arrive as a set. The current gas safety record, renewed annually. The electrical installation condition report, known as the EICR, valid for up to five years. The energy performance certificate, and note our guide to where EPC requirements are heading if the rating is below C. Evidence of working smoke and carbon monoxide alarms.
Take the compliance file seriously even where the tenancy is old, because the file is what a court or council asks for first, and rebuilding it after completion is harder than demanding it before. On completion, serve the two statutory notices in your own name: written notice of the new landlord, and an address in England and Wales for service of notices, because rent demands stand on that second notice.
Section 21 is gone, the exit changed
No-fault possession under section 21 was abolished for England on 1 May 2026, and the transition window for notices served before that date has now closed. We covered the mechanics in our section 21 deadline guide. Possession now runs on grounds, with a judge deciding, which takes longer and carries an outcome risk that did not exist under the old notice route.
For buyers of tenanted stock the consequence is strategic. A purchase premised on obtaining vacant possession soon after completion now needs a specific legal ground and evidence for it, not a notice and a wait. Buy tenanted stock because you want the tenancy, and price any vacant possession plan as uncertain in both timing and outcome.
The PRS database duty is coming
The new private rented sector database exists in law, but landlord registration is not live yet. The duty is expected to arrive with the Phase 2 rollout in late 2026, and the linked possession restriction has not yet been brought into force. Our PRS database guide tracks the status precisely, because the commencement dates move and the penalties attach to the landlord of record.
The purchase angle is simple. Registration duties will sit with you, not the seller, from completion. Put the database on your completion checklist alongside the deposit and the notices, and diarise it against the rollout dates, because when the possession restriction commences, an unregistered landlord’s paperwork will block their own court application.
Rent and arrears on a tenanted purchase
Rent is apportioned at completion: the seller keeps what accrued before, you receive what accrues after, and rent paid in advance is adjusted on the completion statement. Check the statement against the tenancy schedule line by line, because a mis-stated rent date moves real money.
Arrears are different. They belong to the seller unless the contract assigns them to you, and buying arrears usually means buying a collection problem at face value. The cleaner structure is to leave historic arrears with the seller and start your ledger at zero, and where you do take them on, pay a discounted price that reflects recovery odds against a tenant you have never managed.
What this means for property investors
Run the file before you exchange. Signed agreement, bank-evidenced rent, deposit protection with prescribed information, gas, electrical, EPC and alarms, then the completion-day actions: deposit transfer, the two notices, and the database when the duty lands. Every item is cheap to demand and expensive to discover missing. A seller who resists producing the file is telling you what condition it is in.
Underwrite the income on the tenancy you are actually buying, not the tenancy you might create after works and re-letting, and treat any vacant possession ambition as a plan that needs legal grounds you can already name. On licensed stock, remember that an HMO licence does not transfer either. Tenanted terraces and blocks remain some of the strongest cash flow stock we list, precisely because few buyers do this properly.
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