Rensselaer, NY · Member since 2014 · 4 posts · 0 votes
About to close on a triplex on Monday. The current tenants have no agreement in place. I’ve heard of an estoppel agreement, but how can they agree to continue terms from the last lease when there is no previous lease? Both are below market rents, one has been there 10 and 8 years. This will also be my very first rental property so any additional tips/personal experiences you might want to tell me I’m all ears! Thank you.
Real Estate Agent · Keller, TX · Member since 2017 · 850 posts · 825 votes
5y
@Mike Robbins all an estoppel certificate accomplishes is that the tenants declare what their current rents are. But since they don't have a lease in place you need to get rent comps for those properties to determine what the current rates are. Once you close on the property send all the tenants a notice that their rents will increase to what the market rates are. If not they have to vacate in 30 days. Give them a deadline to decide in the letter you send to them as well.Since your dealing with long term tenants keep in mind the units may need updating. So you may have to plan on updating if they vacate in order to get market rents. Especially if they were not professionally managed previously. I would also consider hiring a property management company too. They can manage this process very well as they do this on a weekly basis. Hope this helps.