Selling triplex, tell tenants?

Question

I’ll be listing a triplex in metro Atlanta likely this week.  Is it appropriate to tell the tenants that I’ll be listing it?  Thanks

Andrew Turner · Answer

@Justen Ashcraft I have to agree with @Alex S. on this one. I deal with tenant issues all the time showing occupied property to the investors I work with. It tends to make potential buyers uneasy when tenants are unwilling to cooperate, and I've found that simply being up front with them almost guarantees smooth communication and cooperation between all parties. I wish you the best of luck, but seeing as I work with income property like this in the Atlanta area, I'd love to take a look when it hits the market!

Justen Ashcraft · Answer

I’m only going to sell if I can get the price that I have in mind.  I’ll be selling it at just over the 1% rule.  I intend to ask $220k for a property that grosses $2250 per month.  In this market, I feel that is a fair price.  If I can’t get it, I’ll keep the property as we only currently owe about $100k on it.

Jim Cummings · Answer

@Justen Ashcraft. Another way is to only show after offer is accepted. Best the best approach in my opinion, but sometimes used with Multi-Family.

Jim Cummings · Answer

@Justen Ashcraft.

Change that to NOT the Best approach in my opinion, but sometimes used with Multi-Family.

Scott P. · Answer

When I sold and had to show, I told the tenants I'd take $500 after closing and split it between each tenant on each of 2 sides of a duplex.

Another time I sold without showing.  The Buyers had walked through a year or so prior and declined to walk through again.  In that case I told the tenants by text and U.S. Mail the day I closed.

If  you're going to show, I'd tell them sooner rather than later.  I'd actually tell them up front I was going to list and offer them a chance to buy for a lesser price.  Perhaps that would make them feel good about the unknown they face w/a new landlord coming...

Margaret Johnson · Answer

In the same boat with a four-plex.  We are about to list it but don't want to tell the tenants yet in case it doesn't sell at the price we want, in which case we will keep it.

We have one unit available for show so wouldn't need to show the tenant occupied units until we had an offer

Jordan Moorhead · Answer

@Justen Ashcraft yes you need to

Pavel U. · Answer

I sold a few rentals with tenants. I told them beforehand and asked my realtor to make the process (for my tenants) as smooth as possible. Maybe give a gift card to your tenants too, and ask them to keep the property in a "presentable" condition. Also, assure them that their lease and terms will not change, so they don't freak out.

Michael Noto · Answer

@Justen Ashcraft Is there at least one unit vacant or are all apartments rented? If one or more than more are vacant only show the vacant apartments on the first showing and if there is interest then let them see the occupied units.

You want to do your best to only show the tenant occupied apartments to people who are serious about submitting an offer.

If all units are full I would recommend giving the tenants a minimum of 24 hours notice for any time you will be showing their unit. Their cooperation throughout the selling process is going to be key.

Justen Ashcraft · Answer

I knew I’d need to tell them eventually, just didn’t know at what point that would be.  I’ll inform them once it’s listed.  Thanks folks.

Selling triplex, tell tenants?

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