Purchasing duplex with 2 tenants / Want to get them out asap

Investor · Philadelphia, PA · Member since 2016 · 47 posts · 8 votes

Hey BP,

I am purchasing a duplex with closing in 3 weeks and I plan on doing a full rehab but need the tenants out asap. I obviously can not evict them during this time but would be more than willing to pay 1 months rent somewhere else for each of them. Does this sound like the best option during this time? Thank you!

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Nathan GesnerBusiness Member

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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes

If you wanted the property empty, why didn't you buy it empty? Make the Seller give them notice so the property is vacant when you close.

Because you failed to take that step, you will inherit the Tenants and now have to serve them proper notice and follow the law to get them out. If they refuse, you've just bought yourself a problem.

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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
6y
If you wanted the property empty, why didn't you buy it empty? Make the Seller give them notice so the property is vacant when you close.
Because you failed to take that step, you will inherit the Tenants and now have to serve them proper notice and follow the law to get them out. If they refuse, you've just bought yourself a problem.
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Nat C.
Investor · Miami, FL · Member since 2013 · 807 posts · 475 votes
6y
@Mark Benevento
‘Would be more than willing to pay one months rent for them elsewhere’, sounds like a cash for keys option and is one of the most popular methods of getting unwanted tenants out of a property.
You haven’t provided anymore information about the tenants or what grade the property is (B, C, D?)
This information would hugely help in giving you accurate advice.
The stance on this forum is generally to take a strong arm legal approach when you want to remove someone.
My first approach has always been to kill them with kindness and leave the strong arm legal as a fall back option.
Your idea to pay for their rent elsewhere sounds like a great idea. Why not sweeten it further and offer moving assistance in some way (you pay for uhaul). You can offer to be a landlord reference for new places they apply for.
Again, I don’t know what kind of people they are but I would suggest befriending them. Take a stance of genuinely trying to help them and if you have good interpersonal skills, they will want to find an alternative rental ASAP because they don’t want to let you down.
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Gregory SchwartzBusiness Member
Rental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Nathan G. Is correct. I learn this the hard way. Your best bet is cash for keys. For others out there, this is my game plan going forward...
1. Prior to making an offer ask for leases and the tenant’s application
2. If you determine the tenant wasn’t well screened or doesn’t meet your criteria, request vacancy as part of you offer.
3. Budget for cash for keys and the added time required to remove tenants.
Lastly be prepared to walk away, just like a leaking roof, poor tenants can kill a deal.
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Mark Benevento
OP
Investor · Philadelphia, PA · Member since 2016 · 47 posts · 8 votes
6y
@Nathan G. The current seller isn’t willing to give me the property without the tenants. He is 85 years old and doesn’t want to go through that process during COVID
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Mark Benevento
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Investor · Philadelphia, PA · Member since 2016 · 47 posts · 8 votes
6y
@Nat Chan thank you Nat, I appreciate your input!
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Jim Cummings
Residential Real Estate Broker · College Station, TX · Member since 2013 · 1k+ posts · 969 votes
6y
@Mark Benevento. I'm going to take a different tack on this subject. I acknowledge you said you wanted to do a "Full Rehab".
1. Are these folks current on rent and paying on time?
2. Would you consider renting to these folks when the property is rehabbed?
If 1 & 2 are true - I would suggest you continue to rent to these folks until their "Normal" lease is up, and they have Vacated. If units are currently rented and people are current, why do a "Full Rehab"? Consider the cost of rehab, plus cost of vacancy and push those capital costs downstream for 6 months or a year - as long as you can!
Good Luck!
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Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
6y
If you do cash for keys, give them the money AFTER they move out and when you get the keys. As you are gutting it, you don't need to worry about inspections. I hope you wrote into the contract that the seller is to give you the security deposit so you can return that to them when they move out.
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Andrew C.
Investor · Sacramento, CA · Member since 2016 · 34 posts · 16 votes
6y
Originally posted by @Gregory Schwartz:
@Nathan G. Is correct. I learn this the hard way. Your best bet is cash for keys. For others out there, this is my game plan going forward...
1. Prior to making an offer ask for leases and the tenant’s application
2. If you determine the tenant wasn’t well screened or doesn’t meet your criteria, request vacancy as part of you offer.
3. Budget for cash for keys and the added time required to remove tenants.
Lastly be prepared to walk away, just like a leaking roof, poor tenants can kill a deal.

Nathan and Gregory seem to have the right mindset. I agree. That said, I'm likely to inherit a problem with a bank owned, occupied property, so time will tell if the huge discount was worth the headache...
Andrew

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