Selling a home with tenants in it probably ranks up there as one of a listing agent’s least favorite thing to do. As the seller, it is important that you take the following into consideration when selling a tenant occupied property because these can greatly impact the success of selling your property quickly:
- What kind of relationship do you have with the tenant? – In many cases, landlords and their tenants can get along, However, from time to time the relationship is not so great. If you have a complicated relationship with your tenant it is probably best to wait until they leave to list your property for sale. They can make it very difficult for potential buyers to gain access and may even keep the place a mess, which will turn people off. They may even go out of their way to talk poorly about your property by disclosing problems that they have had in the past but have already been addressed.
- Will the tenant agree to allow showings – When a tenant enters into a lease with a landlord, the last thing they are thinking of is having strangers walk through their home. But because they are there you need their cooperation. When selling a primary residence occupied by the home owner, sellers are more than willing to allow showings at all times of the day. Not the same goes for tenants because they do not have the same motivation as you, the seller. Prior to listing your property it is essential that you obtain their cooperation and define the showing parameters, with regard to time of day and access. Tenants who restrict showings by requiring 24 hour notice, or that the key be picked up at the listing agent’s office, or that the listing agent accompany every buyer and their agent can hurt the success of the sale.
- Is the tenant willing to vacate the home prior to lease expiration – Some buyers of properties used as investments may actually want to live in them as their primary residence. Prior to listing the property, it is important to ask the tenant if they would be willing to vacate the home prior to settlement. You may have to sweeten the pot with reduced rent for a period of time or some other incentive, but if your motivation is to unload the home quickly, you also have to think of the buyer’s objectives as well.
- Is your relationship with the tenant legal – From time to time, there are landlords that have tenants with whom they do not have a legal landlord tenant relationship – no lease, property not registered with local agencies, code violations, etc. Prospective buyers buying tenant occupied homes want to make certain that they are not inheriting a legal nightmare. If you are not going to make your home tenant legal then it is best to ask the tenant to leave prior to listing.
I realize that landlords that are reading this may want to take the risk, but please take it from someone that has had to deal with difficult tenants as a listing agent – it is not worth it. Most of my landlords have ended up frustrated by the process. If you cannot afford to sell it vacant, it may be best to either wait until you get a new set of tenants in the property or sell it during the prime buying season at a price that will allow you to sell it quickly.
Published on 2015-07-26 12:06:46