Selling tenants occupied property and breaking the lease?

Question

I am renting a house in MN and my landlord notified me that he wants to sell his house. My lease will expire in 8 month. However my landlord told me that I have to vacate in 60 days since Minnesota laws allows to break the lease if landlord wants to sell the house with 60 days notice!

Is that true?

I really can't move out until my lease expires. What do you recommend me to do?

Is that true?

I really can't move out until my lease expires. What do you recommend me to do?

Tim Swierczek · Answer

@Sepid PooyThat is not true at all I can help you find the references in Minnesota law. The fact is the landlord is 100% incorrect and I can help you prove it but I’m on mobile now can you PM me and I will help you with this.

Tim Swierczek · Answer

@Sepid Pooy   I looked through the entire 504B Statute and did not find a specific reference.  I suspect that could be because the law relates to contract law and is not specific to the landlord-tenant relationship.  Obviously, @Brad Schaeppi knows what he's talking about.

Pro tip-> When your landlord does showings it's in your best interest to have your place look great and be a perfect tenant, be friendly to anyone who shows up.  One of them will be your next landlord and you need to start off on the right foot.  I can assure you the new landlords are judging you when they view the property.As for the landlord you need to communicate it to them.  I would send something like this>>>Hey (Name),

It turns out that both the Attorney General & MN courts disagree with your understanding of the law.  Here are the two references that show you cannot terminate the lease because you are selling.  That being said I do appreciate that you need to sell and I am happy to cooperate with you for showings and other matters related to selling.  I do of course need to have an appropriate notice and would like discuss it further.

references:

Court opinion

https://homelinemn.org/wp-content/uploads/Fisher-v...

Attorney General Landlord Tenant Guide

Brian R. · Answer

This is per a Minnesota lawyer Kelly Klein who specializes in real estate from another website:

Under Minnesota law, once  the owner sells his house, the buyer takes on all the rights and  obligations of the property. Generally, the new buyer is purchasing your  landlords’ home subject to your lease, so your lease doesn’t end, and  the new owner is required by law to honor your lease terms. There is an  exception if there is a clause in your lease stating that the sale of  the property terminates your lease. Review your lease to make sure there  isn’t a clause that terminates your lease once the property is sold. If  there isn’t such a clause, the buyer of the property becomes your new  landlord. The buyer of the property cannot raise your rent on your  existing lease. According to the law, your current landlord must  transfer your security deposit to the new owner or return it to you with  interest, minus any deductions allowed.

Brad Schaeppi · Answer

@Brian Roeller is correct.  Unless your residential lease has a clause that allows the landlord lessor the ability to provide stated notice and sell the property (yes this is legal), your term residential lease would continue with the same terms and same termination/end date.  Your landlord may be confusing Minn. Stat. 504B.178 as controlling related to "termination of landlord's interest."  It does not.  That only refers to the security deposit.  The Seller may transfer your security deposit to the "successor in interest" (the buyer) or return the security deposit to you (within 60 days).  Typically the security deposit transfers to the Buyer.  If you really cannot move, stay put.  If you can move, listen to a buy out offer.  Who knows, the Seller may make a sweet offer as summarized by @Mike McCarthy.

Mike Strodtman · Answer

Great information and exactly what I was going to share.  It is wonderful that we have a resource like Bigger Pockets to share information!!  Can't thank them enough!

Nathan Platter · Answer

@Sepid Pooy

I am in 100% agreement with @Tim Swierczek and @Brian Roeller

From the Minnesota Attorney General:

"Sale of the Building

If the landlord sells the house or apartment (as opposed to foreclosure by a bank), the lease transfers to the new owner (buyer)"

https://www.ag.state.mn.us/Consumer/Handbooks/LT/C...

The landlord is attempting to get you to vacate so they can then get a new tenant with higher rents, thus raising the value of the property. You have the legal upper hand.

Mike McCarthy · Answer

While you're exploring the legal side, look at what it would take for you to move out.  He obviously wants to sell the house for top dollar, and maybe it will get him more if it's sold as a home instead of a rental.

Approach him and make him an offer (along with your legal details).  You'll keep the house clean and let him show it 2x week during the hours of 8-4, and in return, you'll move out in 2 months - with a 1-month termination fee (that he pays you) - and you get your deposit back at move-out (after he's inspected the property for damage).

You can of course tweak the details, but you can probably work together to make it a win-win instead of a fight.

Shelby Benjaminson · Answer

Do the tenants need to leave when they are showing the units to prospective buyers?

shelby

Sepid Pooy · Answer

@Tim Swierczek Thanks for your reply. I really appreciate if you can provide the reference. I did look at my lease and found nothing specific about early termination in case of sale. Moreover, the landlord did mention the MN laws allowed him to break the lease. He did not mention the lease has a specific term that let him break it.

My lease contract is just a typical lease that is done through Renters Warehouse. Does 3rd party leasing companies like Renters Warehouse typically add such a clause to terminate the lease on sale?

Renters Warehouse is not the property manager anymore and I am paying my rent directly to the landloard.

Matt K. · Answer

A lot of time if it's going to be owner occupied they don't have to honor the lease, if it's an investment then they do. However, look at your lease and see what it says about early termination and or selling of the house.....

Selling tenants occupied property and breaking the lease?

Most Popular Reply