One of the most difficult aspects of managing a rental property, and generating decent returns on it, can be occupying the home in the first place. And, more to the point, occupying it with good, reliable tenants.

In some cases, though, you can buy a home with ready-made tenants already in place – those who remain in the home despite the switch of landlord.

There are a number of reasons why this can be beneficial to landlords and property investors, from swerving void periods to allowing you to generate rental income from day dot.

You will often find investment opportunities with sitting tenants on offer at auction. Here, we outline why it might be a good idea to consider this path.

An immediate return on your investment

As a landlord or property investor, one of your biggest priorities will be getting a return on your investment in the form of steady income and, later, solid rental yields. If this can be immediate, all the better.

And that is far more likely, of course, if the property you are investing in is tenanted. That means you avoid the hassle of finding tenants and you avoid the dead money scenario that comes with void periods – where the home is bringing in no rental income but you’re still paying out costs, sometimes significant costs, on things like mortgage repayments, security and maintenance.

Securing tenants quickly is not always easy or painless, so by having them already in place means you save yourself the job of finding new ones, at a time when Covid restrictions are making moves less easy.

No matter if you’re an experienced investor or landlord, eager to grow your portfolio, or someone just getting started on your investment journey, purchasing a tenanted property at auction can be a very shrewd move.

Why buy at auction?

You might ask yourself why it’s a good idea to purchase at auction, especially if you’ve never done it before. However, auctions are thriving at present as buyers and sellers seek alternative ways to buy and sell homes, and the sector was given a further boost during lockdown when it became one of the only feasible ways for transactions to still take place.

Auction houses, particularly online ones set up to operate remotely, without the need for any physical contact, witnessed soaring interest as people sought a safe, fast, transparent, hassle-free way to purchase or sell a home.

Auctions have long been a great place for landlords and investors to pick up a bargain or a doer-upper – you only need to watch an episode of Homes Under the Hammer for evidence of that – but they are also an increasingly excellent place to pick up homes that don’t require much altering and are already profit-making thanks to the presence of sitting tenants.

It’s unlikely that a seller will try to sell a home with terrible sitting tenants – ones they are desperate to pass onto someone else – because they know the system just won’t allow it and would-be purchasers will do their research, so you can rest assured that a home with sitting tenants is likely to include good, responsible renters who are very eager to stay in the place they’ve made home. It’s also likely they have forged a good relationship with their landlord, as they wouldn’t make the extra effort to keep them in situ during a sale if that wasn’t the case.

Online auctions set to grow

With the potential for further local (or even national) lockdowns, and stricter restrictions on our movements and freedoms again as we enter winter and a critical stage in the fight against coronavirus, there is every chance the boom in popularity online auctions have experienced will continue.

This will especially be the case when people are perhaps more reluctant to be out and about again, and will prefer to do everything remotely from the safety of their home.

Some of the benefits of buying through online auction include quick transactions, the choice of tenanted and vacant properties, 5-day live auctions and 28-day exchange.

Here at Opal Auctions, investors can purchase properties through our traditional online auctions, during which you can bid for properties of all types and qualities.

As an alternative, you can use our ‘Buy Now’ service, which guarantees a purchase upon a small exclusivity deposit being paid. Whichever route you decide to take, buying with Opal Property Auctions is a quick, simple and secure way to purchase your next investment.

To find out more, contact us now for further details on 02033 558 785 or auctions@opalproperty.co.uk.