Bengaluru resale market sees ‘sell-and-stay’ trend as sellers seek to continue as tenants for 6–12 months
Bengaluru homebuyers are encountering an unusual challenge in the resale real estate market, where sellers want to remain tenants for 6-12 months even after transferring ownership. While such “sell-and-stay” deals are not unheard of in tight property markets, legal experts warn that such arrangements raise financial, legal, and practical concerns for buyers, who must balance immediate possession needs with safeguarding their ownership rights.
A Reddit discussion has sparked debate over a trend in Bengaluru’s secondary housing market, where sellers are asking to remain in the property as ‘tenants’ even after the sale is completed.
The thread, posted by a buyer evaluating a resale apartment where the owner wants to continue living under an 11-month rental agreement until September 2026. “ I recently looked at a resale property that I’m interested in. The owner likes the offer but has said they want to continue living there as tenants even after the sale/registration,” the user said.
Some real estate experts said the arrangement may work if supported by a proper rental contract, but others warned it could lead to possession disputes and prolonged delays if not managed carefully.
One of the buyers in Bengaluru shared their personal experience: they lived in the apartment they sold for 6 months because their children’s school schedule prevented an immediate move. They described paying market-rate rent to the new owner and emphasised that transparency is key; sellers should clearly commit to the exit timeline, and buyers should ensure the agreement protects possession rights.
Experts say that while post-sale occupancy by sellers does occur, it is uncommon because most buyers insist on taking possession at the time of registration.
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Buyers should be careful, say experts
Experts note that sale deeds typically include a vacant possession clause, and any deviation must be clearly documented through a registered rental agreement to avoid complications.
Kiran Kumar of Hanu Reddy Realty, a broking firm, said that while post-sale occupancy by the seller does happen, it remains relatively uncommon because most buyers are uncomfortable with the arrangement.
“Sale deeds typically state that the transaction is executed with vacant possession, and that is where the risk lies. If the seller continues to occupy the property, any future dispute, for example, if a family member raises a claim or refuses to vacate, can turn into a serious legal complication because possession is with the seller,” he explained.
Kumar shared an example from his own experience, noting that such arrangements occur only under specific circumstances. “I recently sold a city-centre 4BHK worth ₹6 crore, where the owner had a large amount of furniture and needed time to shift. They stayed for three months after the sale deed while arranging their move. In these cases, especially with NRI sellers who may need relocation time, buyers sometimes agree, but only when there is strong trust and proper legal safeguards,” he said.
He further stated that even in rare cases where buyers permit temporary post-sale occupancy, the agreement must be tightly structured, with clear timelines, rent payment terms, penalties for delay, and a legally enforceable handover date to avoid any disputes.
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A stamped rental agreement with occupancy history is a must, say experts
Legal experts say that if a buyer agrees to allow the seller to remain as a tenant after the sale, a properly drafted and registered rental agreement is essential. The agreement must clearly document the seller’s prior occupancy, the exact date by which they must vacate, and all related terms. Without this clarity, the arrangement can become risky, as sellers may refuse to leave or delay vacating, especially when khata transfer or other property documentation takes time.
Advocate Akash Bantia noted that such situations are particularly vulnerable in Karnataka because the state has not adopted the Model Tenancy Act (MTA), approved by the Union Cabinet in June 2021. Under the MTA, all tenancies must be formally recorded, dedicated rent authorities are established, and disputes can be resolved more swiftly.
“The MTA could protect both tenants and landlords,” legal experts said. “It ensures every tenancy is formalised and disputes are resolved quickly.”
However, since land and urban development fall under state jurisdiction, each state must adopt the Act independently, and so far, only four states have updated their tenancy laws accordingly. In this context, some legal experts caution that buyers in Karnataka are better off avoiding post-sale occupancy arrangements unless strictly documented and legally enforceable.
(Disclaimer: This report is based on user-generated content from social media. HT.com has not independently verified the claims and does not endorse them.)
