Steps to Take When Selling a Tenanted Flat

A Different Sequence to a Vacant Sale

Selling a tenanted leasehold flat follows its own sequence. Several of the steps land months earlier than they would for an empty property, the tenant relationship needs careful handling throughout, and serving a Section 8 notice with Ground 1A commits the seller in a way the old Section 21 process never did. Section 21 was abolished on 1 May 2026 by the Renters' Rights Act 2025, and Ground 1A is now the route to vacant possession for landlords who want to sell.

This article walks through the practical steps in the order a landlord-seller actually takes them: the early decisions, the leasehold checks, the conversation with the tenant, the Section 8 notice and what to gather before serving it, the selling-tenanted route in parallel with the continuing tenancy, the cash-buyer route, the completion-day specifics and the common process pitfalls. For the broader question of whether to sell tenanted or vacant in the first place (and how a tenant in place affects price), see our topic guide on selling a flat with a tenant.

The structure is straight-line: decisions, then the lease checks, then the conversation with the tenant, then the notice (if going the vacant route), then the marketing process (tenanted or vacant), then completion. Each section explains what to do, in what order, and what to keep records of as you go.

Leasehold Checks Before You Start

Before talking to the tenant or briefing the agent, a tenanted leasehold sale needs a handful of lease-specific checks. Most of these come up later in conveyancing anyway; running through them up front saves weeks if anything is amiss, and gives the seller a clear picture of any costs or consents that need to be sorted before completion.

Subletting clauses in the lease

Most modern leases allow ASTs (assured shorthold tenancies, the standard private letting arrangement until 1 May 2026) with reasonable conditions; the Renters' Rights Act converted every AST to a periodic assured tenancy from that date, but lease clauses written in AST terms still apply to the letting. Older leases sometimes prohibit subletting altogether, restrict it to approved categories or require explicit freeholder approval for each tenancy. If the lease prohibits subletting and the flat has been let on an AST regardless, that is a breach of lease the buyer's solicitor will raise during conveyancing. The usual fixes are retroactive freeholder consent (often with a fee), a deed of variation (a formal change to the lease, sometimes needed where a clause is genuinely problematic) or indemnity insurance (a one-off premium that protects the buyer against future enforcement of the breach). Worth reading the relevant clauses of the lease before listing the flat tenanted. Our guide to selling a flat with a no-subletting clause covers the breach scenario, the fixes and the costs in more depth.

Freeholder consent for the existing AST

Even where subletting is permitted in principle, many leases require the leaseholder to obtain the freeholder's consent (or to notify the freeholder) for each new tenancy. Confirm that consent was given when the current tenancy started. If it was not, contact the managing agent now to request retroactive consent: the fee is usually modest (£100 to £300) but the issue can hold up a sale if it surfaces during conveyancing instead.

Notification, registration and consent fees

Some leases (and some managing-agent agreements) require an annual or one-off notification fee for tenanted flats. The buyer's solicitor will see these on the management pack and ask about them. If the seller has been paying them, the running cost transfers to the buyer on completion; if the seller has not been paying them, expect the buyer to want clarity on whether arrears are owed.

Block insurance and tenanted occupation

The freeholder's block insurance policy is the building's main cover, paid for by leaseholders through the service charge. Some block policies require notification of tenanted occupation and may exclude or limit cover for a flat let on an AST that has not been declared. Confirm with the managing agent that the policy has been notified of the tenancy. An undeclared tenancy can affect a future claim, and the question will surface when the buyer's solicitor reads the LPE1, the standard leasehold enquiry form the managing agent completes for the sale.

Pending Section 20 major works during a tenancy

Section 20 is the consultation procedure under the Landlord and Tenant Act 1985 for major works on the building. Pending works can mean scaffolding, restricted access, water shutoffs and noise during the tenant's occupation. The management pack will show any pending Section 20 notices. The buyer will want to know what is coming; the tenant has a right to be told about anything that affects their use of the flat. A tenanted sale where major works are about to start often gets renegotiated mid-conveyancing, particularly where the leaseholder cost share is large.

Lease length on a tenanted sale

On a tenanted sale, the lease length matters as much as on a vacant sale, often more. BTL (buy-to-let) buyers' lenders apply minimum lease lengths (typically 80 to 90 years remaining at completion, more conservative than residential lenders); below 80 years marriage value still applies, since the Leasehold and Freehold Reform Act 2024 (LAFRA) provision abolishing it is not yet in force; below 70 years few BTL lenders will lend at all. A short lease and a tenanted property compound the discount, sometimes to the point of making the property practically unsaleable to BTL buyers. The fix is the same as on any short-lease leasehold sale: extend before listing, accept the discount, or sell to a cash buyer (which on a tenanted leasehold flat means going the Ground 1A route first, since cash buyers buy with vacant possession).

Serving a Section 8 Notice with Ground 1A

If the route is vacant possession via Ground 1A, this is the legal step that starts the clock. The mechanics are not complicated, but the consequences are real.

The prescribed form

In England, the notice is given on the prescribed Section 8 notice form, available from gov.uk. The prescribed forms regulations were updated for the post-1 May 2026 grounds, so check the current version before serving rather than relying on a saved older copy. The prescribed wording must be followed precisely. The notice must specify Ground 1A as the ground relied upon, give the earliest date after which possession proceedings can be issued (4 months from the date of service for Ground 1A) and be signed and dated by the landlord or the landlord's agent.

Evidence to gather BEFORE serving

Ground 1A requires genuine intent to sell. If the tenant contests possession, the court will look for evidence that the landlord actually intends to sell rather than using the ground speculatively. Have evidence in place before service; two or more of the following is a sensible benchmark, though the Act sets no fixed list:

• A current valuation from an estate agent or a RICS (Royal Institution of Chartered Surveyors) surveyor
• A signed estate agency agreement or instruction letter (post-notice marketing is also fine, but having an agent lined up is good evidence)
• Solicitor correspondence on the planned sale
• An indicative offer from a specialist cash buyer (if going that route)

This evidence does not need to be filed with the notice. It needs to exist, be dated and be available if the tenant later asks for proof or a court does.

Service

Service can be in person, by recorded delivery or in line with any service-of-notices clause in the tenancy agreement. In person is the cleanest: the landlord (or their agent) hands the notice to the tenant on a doorstep visit, asks the tenant to acknowledge receipt and keeps a dated copy. Recorded delivery is a workable alternative; track-and-trace receipts are valid proof. Email-only service is risky unless the tenancy agreement specifically permits it.

The 4-month clock

The 4-month period runs from the date of service. If service is on 10 May, the earliest date for possession proceedings is 10 September of the same year. The tenant is entitled to remain until that date.

The no-relet restricted period

This is the part many landlords miss. Under the Renters' Rights Act 2025, the landlord cannot market or offer the property for letting or a licence to occupy (e.g. Airbnb) for a restricted period starting on the date the notice is served and ending 12 months after the earliest-proceedings date given in the notice (or, where a possession claim is issued, 12 months from the claim, if that is later). In practical terms, allowing for the 4-month notice period, the property cannot be relet for a minimum of 16 months from the date the notice is served.

Listing the property as "to let" on Rightmove, Zoopla or any other portal during this period is an offence: a local authority can impose a financial penalty of up to £40,000 as an alternative to prosecution, the most serious tier of penalty under the Act. Lesser non-compliance elsewhere in the Act carries civil penalties of up to £7,000, but unlawful marketing or re-letting in the restricted period sits in the more serious category. There is a narrow "all reasonable steps" defence and limited exceptions, both of which are best assumed not to apply unless a solicitor confirms otherwise.

Month 0481216

The sale

Months 0 to 4Notice served; the tenant can stay to the end of the period

Months 4 to 9Vacant possession (voluntary or via court), then completion

SoldThe sale is usually long finished by now

The no-relet ban

Months 0 to 16No re-letting and no "to let" marketing, even if the sale falls through: civil penalty up to £40,000

Logging service properly

Keep a dated copy of the served notice, proof of service (signed acknowledgement, recorded-delivery slip, witness note), and a contemporaneous note of the conversation if the notice was handed over in person. This pack stays with the file from now until at least 12 months after completion.

Completion-Specific Steps on a Tenanted Sale

Completion mechanics for a tenanted sale differ slightly from a vacant sale at a few specific points.

Sold tenanted (with the tenant in place)

• Deposit transfer. The deposit moves from the seller's deposit protection scheme account to the buyer's, on the same scheme or a different one. The tenant gets fresh certificates from the new landlord.
• The tenancy continues. The buyer becomes the landlord automatically on completion; no new agreement or deed is needed and the tenancy terms are unchanged.
• Section 3 notice (Landlord and Tenant Act 1985). The buyer (the new landlord) must give the tenant their name and contact address within 2 months of taking over. Most buyers' solicitors handle this as part of the post-completion paperwork.
• Keys. Keys go to the new landlord, not the tenant; the tenant keeps the set they already have.
• Rent apportionment. Rent paid for the part of the month before completion goes to the seller, the part after goes to the buyer. Handled on the completion statement.

Sold with vacant possession (Ground 1A route)

• Tenant has already left. By completion the property is empty and standard completion mechanics apply (see our completion day guide).
• Final rent and deposit. The deposit is returned to the tenant after their departure (less any deductions for damage or unpaid rent), in line with the deposit protection scheme rules.
• Final utility readings and council tax notification. Done either by the tenant on the last day or by the landlord shortly after.
• Empty period. Between the tenant leaving and completion, the landlord pays council tax on the empty property at the rate set by the local authority (most councils now charge full rate or higher on empty properties, with limited or no exemption windows) and continues to pay service charge and ground rent.

Both routes

Notification to the managing agent and freeholder of the new ownership; service charge and ground rent apportioned at completion as for any leasehold sale; Notice of Transfer served on the freeholder by the buyer's solicitor in line with the lease.