A question we often field is: “Do we sell our home and then give the tenants notice” or “Do we give the tenants notice, have them vacate and then sell”?
I’m sure if you ask a few different Realtors, you will get a few different answers, and my answer is a resounding ~ have the tenant leave, take possession of your property, and then sell!!! If your lease is not ending soon, work with them, buy them out, or compensate them for their cooperation.
This is not open for discussion… it’s not an option, as it’s a very simple answer!
Please don’t get me wrong, I’m not saying that tenants are bad… that is not my position!
My statement is based on past experience… and experience shows that in most cases, by allowing the tenant to stay in possession, it could cost you thousands!
- There could be maintenance issues, repairs, cleanliness issues, that would be better served if taken care of.
- There could be a loss in value due to the inability to get a larger amounts of people into the property in a short period of time (Demand drives value…) You have to be respectfully of the lease and showing times as outlined in the lease agreement.
- Minimal online photos due to tenants personal belongings and property (According to the National Association of Realtors NAR, 90% of all buyers start their search online, and over 80% of these consumers will leave a listing due to the lack of photos).
- These items would likely lead to the property taking longer to sell, which would then lead to an increased cost to carry.
- Additional Costs associated with the tenant rescheduling professional services, photographer, inspector, appraiser, etc…
- Tenant stops paying rent or refuses to vacate due to the inconvenience or frustration in the process. Then you have an adverse Tenant in possession and possible Eviction expenses.
- Additionally… there could be possible tenant relocation expenses should there be a stall at the end of the transaction.
Landlords or sellers will often say, “I don’t want to lose a couple of months rent”… and yet, experience shows that if they simply have the tenant vacate prior to selling, they can often recover that loss, and even net more money.
Some of the many benefits of having the tenants vacate early are:
- The property is much easier to access
- While a furnished home almost always shows better… most homes show bigger when the are vacant…
- The property will show better staged then it typically would with the tenants personal property.
- The properties are easier to access, and there are no scheduling conflicts as there is no one in possession of the home.
- The buyers are able to see themselves in the home vs. looking beyond the tenants personal property.
Bottom line… if you are contemplating selling your house with a tenant in possession, it could cost you!
Give us a call today at 714-746-8103 ext. 101, and we will happily walk through your rental property with you and make you a list of what to consider, along with leaving you with our Room By Room review. This report will provide you with 101 tips on how to set up your property to sell faster and for more money.