Selling Your Rental Property With Tenants in It
Many landlords often don’t know if they can sell their tenant-occupied rental properties or even the available options. Even though there are several options you can take, the key to getting your occupied rental property sold is to properly market your property to the right buyers or investors and present the property in front of the right set of eyes. If you’re looking forward to selling your rental property with tenants in place, we’ll help you understand the practical and legal considerations as well as the different options available for you.
Can I Sell My Rental Property With Tenants in It?
This is a common question from many landlords, and the answer is yes. However, selling an occupied property can be more complicated than selling an unoccupied property, which is quite a straightforward sale.
Even though the property is yours and you have all the right to sell it, your tenants are an extra variable in your sale, and you must consider their welfare. Educate yourself about the local rights and laws that protect your tenants.
Options for Selling Your Occupied Rental Properties
There is no one-size-fits all approach or solution to selling your tenant-occupied property. Here are some of your possible options:
Transfer the Lease to the New Owner
The lease can often be transferred to the new owner, and the tenants are allowed to finish off the remainder of their lease. This is often the best option for the landlords selling their tenant-occupied properties if the seller is okay with it.
You can sell your rental property to an investor or individual looking for rental property income. In this case, the lease terms will simply transfer from you to the new owner of the property. This selling option offers stability to your tenants as they’re not required to move.
However, the only drawback you’ll encounter as a seller is that this option has a smaller buyer pool.
To show and advertise your rental property to its best advantage, there are several practical and legal considerations to be taken into account, including tenant rights under the rental agreement and the local or state laws:
- Ensure that your tenant is cooperative and okay before selling the property with your tenant still occupying the property.
- Make the showing times of the property easy for the tenant. For instance, let your real estate agent know that your tenant needs to be informed at least 24 hours before to ensure there are no inconveniences.
- If the need arises, help your tenant find a new place. For example, if you believe having an unoccupied property will help with your sale, you might want to end the tenancy before your sale is complete.
- Overall, remember that showing and marketing your property may be smoother if you don’t have a current tenant.
Buying the Tenant Out
Buying your tenant is another option you can consider. This is popular in lots of hot markets. However, whether the buyer or seller initiates the buyout, someone has to front the cost and negotiate with the tenants to vacate.
As a seller buying out a tenant, you’ll have to incur some expenses or tens of thousands of dollars upfront.
Turning your occupied rental property into a vacant rental property will help you avoid some challenges that come with selling an occupied property, including a buyer’s fear of inheriting a “bad” tenant and difficulties in showing your property because it’s occupied.
However, keep in mind that buying out your tenant is not an excellent option for the landlord because you must consider the lease agreement.
Waiting for the Tenant’s Lease to End
If you intend to sell your property as a vacant unit and it’s currently occupied, then you have a slower approach to waiting for the tenant’s lease to end before selling the property. You’ll need to do a lot of forward-thinking to visualize what the real estate market will look like in the months to come after your tenant’s lease comes to an end.
For instance, if it’s spring and your tenant’s lease ends in winter, then that means you’ll be listing your property in winter when the real estate market is not too great for property sellers. Also, this option is not convenient if you urgently want to sell your property.
How Do You Sell an Occupied Property?
Now that you’re aware of the available options, how do you sell your occupied rental property? Even though selling a rental property with tenants is not an easy task, it can still be done. You’ll find it much easier if you understand who your buyer is. Knowing your buyer will help you market your property to the right set of investors or buyers, and once you find the right audience, you’ll be able to turn your challenges into great, marketable positives.
Knowing and Understanding Who Your Buyer Is
Knowing and understanding your potential investor is the key solution to selling your tenant-occupied rental properties. You need to know and understand your exact target audience because that’s the secret to having a successful sale.
Ask yourself, who is your potential buyer? Where can the buyer be found? And why would they want to purchase the property from you? Consider targeting investors looking forward to building a portfolio of occupied rental properties. You can find investors on real estate platforms, real estate investor blogs or forums, and real estate buyer or investor meetups.
The most seamless option to sell your occupied rental property is to list your property in a marketplace specifically tailored for buyers looking for properties with tenants. This way, you’ll be getting your property to the right audience of investors, and that’s where we come in.
Offercity Can Help
At Offercity, our goal is to provide value in your selling journey, and we’re the leading marketplace to sell your tenanted rental property. Offercity works with property owners to find the best solution for them at the best price. We buy properties with tenants in place as-is. Sellers receive the best price for their property and no longer have to worry about dealing with tenants. When you sell your property with Offercity, you can be completely done with it hassle-free! You won’t have to worry about maintaining your property or incurring any further costs, and you can sell your house closest to your maximum profit at the current moment. Contact us to learn more about selling your rental property with tenants in it.