How to Sell a Property with Tenants

It’s a tricky situation when you’re trying to sell a rental property that is currently occupied by tenants. You want to be respectful to your tenants’ rights, but you also know that you don’t want to be stuck as a landlord anymore. Here are some tips on how to handle selling your property stress-free and with grace:

COreillyTeam-CircleMasterFile5-Nov15ommunication is key.

Letting your tenants know you are looking to sell is the first step to approaching this problem. Maybe they are looking for a new place to live and were looking to cut their lease short anyway. Maybe they are interested in buying the property from you. By asking your tenants their concerns and questions about your selling process, you can ensure that it goes as smoothly as possible for all parties involved.

Continuing the communication throughout your selling process is also important. Letting your tenants know about any upcoming home inspections helps them keep the process from disrupting their personal lives, which makes things easier on you in the long run.

Understand your options.

When selling a property that has tenants, there are several approaches to take. You can wait for the lease to expire and your tenant to move out, and then begin the process of selling. Reviewing the lease may reveal other details. Most leases have an early termination clause that you may choose to execute, but you should still be reasonable and respectful to your tenants and be sure they agree to the conditions as well. The other option is to sell the property with an active lease. Again, this is something that needs to be discussed with your tenants, as well as your potential buyers.

Provide a benefit to your tenants for moving out.

Negotiating a monetary settlement, or a “cash-for-keys” tactic, with your tenants may be the easiest way to begin selling right away. You can offer to pay the difference between your rent and other rentals’ rent for the remaining time left on their lease. You can offer to cover moving costs or pay half of their security deposit for their new place. Providing small incentives, like gift cards, can also help remedy any other inconveniences brought upon your tenants by the process, such as inopportune house showings or appraisals, keeping you in good standing.

If you ever have questions about how to sell a home or other property, contact Dan O’Reilly at the O’Reilly Team — he’ll be happy to help.