What You Need to Know
Selling a rental property is a different and somewhat more difficult process than selling the
home you live in. However, when there are tenants in that rental property, selling it becomes
even harder. The presence of tenants in a rental home that is for sale adds another layer of
complexity to an already complicated process.
Depending on several factors, those tenants can be the reason why a buyer wants the home or
why a buyer walks away. Whether the presence of tenants in the home makes or breaks the
sale of the property depends on how you handle the situation. This article explains some of
the things to do when selling a property with tenants in it.
Can you sell a property with tenants in it?
Perhaps the first question we should answer is whether you are legally permitted to sell a
property when there are tenants in it. The answer is yes. Given that the property belongs to
you, you have a right to sell it whenever you want. But you are only allowed to do this after
you have considered the tenant’s rights , as determined by the lease.
That being said, you really don’t have to sell your property while there are tenants in it. You
can wait until the tenant’s lease expires before you list the home. Or you can go ahead to look
for buyers while the tenant is still in the property. What are the pros and cons of each option?
Waiting for the lease to expire: The pros and cons
– With the tenant gone from the rental, you have a chance to clean and renovate the
property in preparation for listing it. This could help you sell at a higher price.
– If the property is vacant, you can accept offers from buyers without worrying about
whether your tenants have enough time to move out.
– On the other hand, you have to bear the full carrying cost of selling the home when
there are no tenants in it. That’s because you don’t have the monthly rent to reduce
your costs. But you can also avoid this if you sell the property to us at Modern Times
Homes ; we will save you all the hassles by making you a fair all-cash offer.
Selling with tenants in the home: the pros and cons
- With tenants in the property, you do not have to stage it. The tenant’s belongings in
the home will help buyers connect with the property and visualize themselves living
in it. - If the buyer intends to use the home as a rental property , the presence of a renter can
be a plus. The new owner will not have to find a new tenant. - On the downside, an unhappy tenant can make showing difficult and may not keep the
home clean and tidy to your expectations.
Options to explore when selling with a tenant in the property
If, after considering the two options, you decide that selling the property with a tenant in it is
the better alternative, what can you do to make the process easier?
Here are the steps you can take to avoid problems with tenants as well as unnecessary delays.
But also remember that selling your house to Modern Times Homes is a third option that’s
worth exploring. We are cash home buyers; we buy and sell houses in Illinois.
- Understand the lease agreement
Before you take any of the steps below, review the lease agreement. Also find out
what the law says about how much notice you are required to give your tenants. If the
home is sold before the tenant’s lease expires, the newer owner will often be required
to let the tenant remain in the house until the end of their lease.
- Offer the house to your tenant
Selling to the tenant could turn out in the interest of both parties. Taking this route
actually saves you a lot of trouble since you don’t have to do any showings. If your
tenant accepts to buy the home, you may sell using any of these two financing
arrangements: a lease-to-own agreement or a seller-financed agreement.
- Agree on a month-on-month lease with the tenant
You can inform the tenant that the existing lease will be cancelled on a certain date. In
place of the old lease, draw up a month-to-month lease agreement. This type of
agreement doesn’t have an expiration date, but tenants pay the rent on a monthly
basis.
- Take these steps to make showing times easier
Your tenant can frustrate your efforts to find a buyer for the property. Take the
following steps to reduce the possibility of this:
o Give the tenant a 24-hour’s notice every time you have a showing coming.
o To make sure prospective buyers are comfortable during the showing, request
that the tenant be away from the home during the period.
o To reduce the burden on your tenant, hire a cleaning service to get the home
ready for showings. This will give you a measure of control over the condition
of the home during the showing.
o Help the tenant find a new home. This can help speed up the sale.
Lastly, if your home is in Rockford or any location within Illinois and you are asking yourself
“how can I sell my home fast?” Modern Times Homes can help you by making you a fair all-
cash offer for the property.