No, you do not necessarily have to wait for your tenant to leave before selling in 2026. While selling with a tenancy in place requires navigating Victorian tenancy laws regarding access for inspections and notice periods, vendor confidence has improved significantly through late 2025 and into early 2026 (Woodards Real Estate, Raine & Horne). However, recent RBA rate hikes have introduced caution, potentially impacting buyer urgency (Domain).
Selling an investment property with a tenant requires careful planning, but it’s a viable option in the current market. The key is understanding your obligations to the tenant and preparing comprehensive financial information for prospective investor buyers. The decision to sell now versus waiting depends on your individual circumstances and risk tolerance.
What are my obligations to my tenant if I sell?
Under Victorian tenancy law, you must provide appropriate notice to your tenant before ending the tenancy to facilitate a sale. Inspection access is also regulated, typically limited to no more than two open for inspections per week with reasonable notice. Failing to adhere to these regulations could lead to legal complications, so clear communication with your property manager is essential.
What information do investor buyers want to see?
Investor buyers will scrutinise rental income statements, property management records, and tax depreciation schedules to understand the property’s yield potential. Having this information readily available demonstrates transparency and can expedite the sales process. Proactively commissioning a pre-sale building and pest inspection can also address potential concerns upfront.
How does Capital Gains Tax (CGT) affect selling an investment property?
If the property was previously your principal place of residence, a partial CGT exemption may apply, calculated based on the period it was your main residence versus the total ownership period. The 6-year rule allows continued PPOR treatment for up to six years after moving out, provided you don’t nominate another property as your PPOR. If held for more than 12 months, the 50% discount still applies to any taxable portion.
The timing risk.
The February and March 2026 RBA rate hikes have introduced new caution into the market, and buyer urgency has dampened (Domain). While listings are up significantly (Raine & Horne), this also means increased competition for buyers. The window of improved vendor confidence may narrow if rates continue to rise, making timing a critical consideration.
Frequently asked questions
Will selling now impact my tax liability?
Settling before 30 June 2026, in a year of lower income, may reduce your CGT liability. Calculating your potential tax obligations under different sale price scenarios with your accountant *before* listing is crucial. Remember to factor in any impact from previously claimed depreciation (Division 43).
What’s the best way to coordinate a sale with buying another property?
In Melbourne’s active market, simultaneous or near-simultaneous settlements (60–90 days) are common. Selling first removes bridging finance risk but may require temporary accommodation. Buying first secures your next property but carries the risk of owning two if your sale takes longer.
How do I prepare a depreciation schedule for potential buyers?
A current depreciation schedule details allowable tax deductions for building wear and tear. It’s a valuable asset for investor buyers, demonstrating the property’s ongoing tax benefits. Ensure it’s prepared by a qualified quantity surveyor and readily available during inspections.
What if my tenant doesn’t cooperate with inspections?
Tenants have rights regarding inspection access, but you are entitled to reasonable cooperation. Your property manager should communicate the inspection schedule clearly and address any concerns. If a tenant consistently obstructs access, legal advice may be necessary.
Questions to ask your agent
- “Based on comparable sales in the area, what is a realistic price range for my property, considering the current tenancy?”
- “Can you outline a detailed marketing strategy that will attract investor buyers, highlighting the property’s rental yield and potential?”
- “What is your process for coordinating inspections with my tenant to minimise disruption and maximise buyer attendance?”
This article contains general market information based on data current
as at April 2026. It does not constitute financial, legal, or real estate
advice specific to your property or circumstances. For an appraisal and
tailored advice, speak with a Fletchers agent in your area.