Selling a property that currently has a tenant

2 Replies

I'm going to be selling a rental property, but I currently have a tenant. He signed a 6 month lease that ends Sept 30th of this year (2018). He hasn't been a total pain (he takes very good care of the property), however his original 1-year lease ended in January. He then did month-to-month from Feb-March. I'm not entirely sure he will stay til the end of this new 6-month lease.

I have only recently started talking to my real estate agent, and she has indicated that the best time to sell in my city's market may be sooner than the end of my tenant's lease. I'm not 100% decided on selling before he leaves, but I want to explore the option just so I understand it. The tenant's lease (standard lease for my property management company) does not include anything about early termination by owner or what happens if the property is up for sale (other than the tenant needs to be notified 24 hours before the house will be shown to prospective buyers). I don't want to assume either way what it means if there is no clause in the lease for this. My property manager is currently on vacation so I'm posting in this forum to see how others have dealt with this particular issue.

Thanks!

If not specified in the lease a landlord may not terminate a lease for the sale of a home. A tennat may choose to break a lease at any time that suites them. Leases are a one way street  controlled by the tenant.

If it is a SFH you would be much better off selling it after the tenant leaves. Most home buyers are not interested in purchasing a tenant occupied property which will eliminate the majority of potential buyers and likley force down th esale price. You could ask if th etennat will move out sooner but can not force them to leave before the lease ends in most jurisdictions.

@Mikaela C. Who is your target buyer a investor or and end user? If an investor the buyer should be ok with it being occupied. If an end user just put in the listing that lease expires on XX.

Talk to tenant and see if he is OK with some limited showings with advance notice and if he will keep place in condition needed to show property.

I would consider offering him a cash payment if house sells for top dollar. This will encourage him to want to keep place in good clean condition and not talk badly about any potential issues.

If he is not going to comply with your wishes then I would wait till he is out before showing house. In that case send him written notice that you will not extend month to month lease beyond XX date.

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