Selling a Property With Tenants? What to Consider
As a landlord, you’re glad to have tenants living in your property — but now that it’s time to sell, those tenants may throw a wrench into your plans.
Unless you’re flexible (or really lucky), your selling schedule probably doesn’t perfectly match the dates on your tenant’s lease.
That means you may have to put the property on the market while your tenants are still under contract… and some buyers may not be interested in purchasing a property that comes with tenants attached. Selling a house is stressful enough, and the last thing you need is a tenant interfering with the sale of a property.
When you’re selling with tenants in residence, you do have options. The good news is that you don’t have to wait until the property is vacant before hanging a ‘For Sale’ sign. Read on to learn about selling a house with tenants.
Selling a Rental Property with Tenants
If you’re considering selling a house with tenants, it’s important to be aware of both landlord and tenant rights when house is for sale. Regulations vary from state to state, so take the time to research your state’s landlord-tenant statutes.
Regardless of legal necessities, you should give your tenants notice as soon as possible. This way, they can start making arrangements to find a new residence.
It’s also important to keep your tenants updated. They’re likely to have questions about the process, so provide as many details as you can upfront. Start by letting them know exactly when the property will be placed on the market.
If you plan on showing the home, they’ll need to be notified well in advance. Some states have laws that regulate showings, so do your research. If you’ll expect your tenants to make any preparations for showings — such as cleaning, making sure pets aren’t in the house, leaving the property during the showing, etc. — let them know in writing.
But what if your selling timeline doesn’t mesh with your tenants’ rental contract? You may be curious if you can evict a tenant to sell a rental property. In most cases, you can’t legally evict a tenant to sell the property unless it’s spelled out in the lease.
If you used a template or form for the lease, as many landlords do, check for language regarding eviction or selling the property. Standard contracts often include language specifying the time required to give eviction notice in case of a sale, usually from 30 to 60 days.
You’ll also want to check state and local laws for any regulations governing eviction in case of a home sale. For instance, some cities have rent control ordinances that require landlords to prove they have just cause — a.k.a. a legally recognized reason — for eviction.
Give your tenants as much notice as you can. Being upfront with tenants and keeping them in the loop is more likely to make them feel like cooperating with you.
What If Your Tenant Has a Month-To-Month Lease?
A month-to-month lease can be ideal for landlords who wish to sell. Typically, this type of leases offers the most flexible rental situation.
While you’ll want to check local and state laws, in many cases you may only need to provide renters with a 30- to 60-day notice before you ask them to vacate. Many month-to-month leases don’t even require cause or explanation, so you might not have to tell your tenant about the impending sale. However, they may be more cooperative about home showings if you’re upfront.
Either way, when you notify the tenant to vacate due to sale, follow the terms of their lease as you detail when the agreement will end.
What About a Tenant with a Fixed-Term Lease?
A fixed-term lease isn’t quite as flexible. If the lease doesn’t have an early termination clause and tenants are paying on time without violating terms, you may just have to wait it out until the lease expires… even if it delays your selling plans.
Bottom line: If tenants are following the rules, you can’t kick them out just because you’re ready to sell.
Notice to Tenant to Vacate Due to Sale
You can notify the tenant with a sale of property letter. These letters offer a straightforward way to both let the tenant know about plans to sell and provide important information.
When creating a letter to a tenant of intent to sell property, your notification should include:
- Identifying information, such as the property address, tenant name(s), and date
- An explanation of what’s going on with the sale, such as anticipated listing date
- Whether there will be showings and, if so, detailed expectations for the tenant (do the dishes, put the dog in a crate, etc.) as well as yourself (“I’ll provide X hours of notice by email/call/text before the showing”)
What If Tenant Won’t Move and I Can’t Wait?
If your tenant has a fixed lease and they don’t want to move before their contract is up, you can still sell… but it’ll be harder to find a buyer.
You do have options. You could offer your tenant a chance to buy the home. After all, they might just love living there enough to buy it. If that’s not an option, you could try paying your tenant a bonus or offer some other inventive to vacate.
However, the easiest solution by far is to sell your house to HomeGo. HomeGo will make an on-the-spot offer — taking your tenants off your hands so you don’t have to worry about the stress of selling a property with renters.
Best of all, selling with HomeGo means you’ll sell your house faster and easier. You won’t have to worry about inspections, appraisals, repairs, and upgrades. There’s no staging (or even cleaning!) involved. HomeGo will make a firm offer and purchase the house as-is, including with tenants, and close in as little as a week.
Talk to a HomeGo agent, and schedule
a no-obligation walk-through today.
Fill out the form, and we will be in touch shortly.