How To Sell A Tenant-Occupied Home | Local Home Buyer CA


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How To Sell A Tenant-Occupied Home

Thinking of selling your rental property but it’s tenant-occupied? 

Selling a house is a major and exciting financial decision if you have equity. Yet, when tenants are still occupying the property, things can get complicated. If you’re asking, “Can I sell my house with tenants?”, you should know a few things about selling a tenant-occupied property.

Local Home Buyer CA will handle the entire sale, from speaking to the tenant to the closing of escrow. We buy homes for cash with tenants and pay you as quickly as seven (7) days! That is why, in this article, we will help you navigate through the process of selling a tenant-occupied home.  

Put your property up for sale

This consideration remains the most crucial factor for landlords and property owners. Having a tenant still living in your property could cast doubt on whether you should sell the house or property. There’s a moral imposition for owners asking, “Should I sell my house with tenants?” It also helps to start discussing your decision with the tenant.

Informing the tenant of the upcoming sale

Usually, the landlord and the tenant agree on extra terms that might need to be discussed. The first thing discussed is why the lease terms can no longer be extended because of an impending sale. If you’re looking to sell the property before the tenant’s lease expires, you can offer them compensation for terminating the contract, also known as “cash for keys.”

You might also want to extend the courtesy of offering the property to your tenants first. They might be good potential buyers since long-time tenants are already familiar with the property and the location, plus they’ve established a connection with the house over time.

Next, it is also essential for you to explain why you’re selling the property. Telling your renters that “I’m looking to sell my house fast with tenants because we’re moving out of the area,” or that there’s an emergency, usually works. Still, you should recognize that being sudden in these situations can be very difficult for the tenant. This is true, especially if the renters have lived in the house for a long time. Getting the tenant on board with the sale can help you sell your house with less difficulty and quicker.

It would help if you reassured the tenant. Selling the property to a new owner doesn’t mean that they will be kicked out. In most cases, a change of ownership only implies a change of landlord. Still, let them know the realities of the situation. These realities include a difference in the terms once the property is sold. Once it happens, some things are already out of your reach, and the tenant will need to sign a new rental agreement with the new landlord or owner.

Hiring a lawyer

Many homeowners are stuck with the ‘I want to sell my house fast with renters’ mindset, but they’re not cooperating with you to sell the home, so who can help you do this? This is one of the situations where you might need professional help.

In worst-case scenarios, you might have to bring a lawyer on board or hire an eviction company, depending on the state where the property is located. Remember that eviction should only be the last resort, and below are certain complexities that would need the help of a legal professional:

  • The tenant has called in a lawyer first and is looking to extend their stay or prevent the eviction.
  • The tenant is currently filing for bankruptcy.
  • The tenant in question is a beneficiary of a housing program run by the city or state.
  • The tenant also works under you as an employee, which could strain your employer-employee relationship.

Remember that your tenants have rights, and failing to arrive at an amicable decision could result in you facing penalties for illegal housing discrimination. But, you should agree on the terms pending the sale of your house with tenants so you can start the process of putting the property on the market for sale.

Showing the home to prospective buyers

Assuming that you’ve listed the property for sale, you’ll need to prepare yourself and your tenant for interested parties that want to see the inside of the home. The tenant retains their legal right to not have people enter the house as long as they’re your tenant.

Providing a written notice

Providing your tenant with a written notice and obtaining their express permission is always necessary. The message must clarify the reason for entering the house with tenants. It should also note the date and time of the visit. Should the current residents agree, you can proceed. You can create a one-time agreement with fixed viewing schedules or you can do it on a case-to-case basis as long as the landlord and the tenant agree.

Putting up a tenant-occupied property for sale could be an advantage for an investor looking to buy a property that already has a tenant in place. The agent or the landowner facilitating the showing of the house will be responsible for the safety of both the property and the existing tenant’s possessions.

Letting prospective buyers view the interior of the property

If the property is in a prime location or a bustling real estate market, you can look forward to many potential buyers. If you or your agent are looking to accommodate many people at once, you can host an open house on a specific day and time frame for prospective buyers to view the home. A consideration with this arrangement is that the one hosting the open house might not be able to provide equal levels of supervision to all attendees, so you may need more support.

A written notice is also required before hosting an open house. Suppose the tenant refuses entry to the landlord, or the landlord has imposed unreasonable schedules and conditions for open house activities. In that case, you can invite a lawyer to help resolve the dispute.

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Challenges of selling a house with tenants

There are several extra considerations and challenges when selling a tenant-occupied property. By being aware of potential challenges ahead of time, you can prepare better and set up a strategy that will increase your odds of selling the property at a reasonable price.

Smaller market

Usually, homeowners are filled with ideas such as “How to sell my house fast with tenants?” But the truth is, selling a house with renters often means a smaller pool of potential buyers. Many people are turned off by the prospect of property with someone living in it. This especially applies to those looking for their own homes to move into. Usually, real estate agents and investors are the interested parties in tenant-occupied properties.

This means that selling an apartment or a house with tenants is for investment purposes only. Any marketing efforts based on connecting with the market might not be the best strategy in this case.

Concerns with inherited tenants

Since your buyer will be taking over the rented property, it’s normal for them to have concerns about the tenant they’ll be inheriting. You might want to include a short history of the tenants: income, eviction history, and whether they are responsible residents.

Before asking, “How can I sell my house fast with a tenant?” ask yourself what kind of tenant you have. It might be better to have them vacate the house first before selling it, because every situation is different.

Lower prices

With issues like lower demand and buyers’ fears, you can expect the property to sell for less than its market value. This scenario is more likely to happen if the property is rented for less than the latest projections. Buyers would use the fact that the house still has renters to drive the price down.

Scheduling issues

As mentioned earlier, setting schedules for showing the house to prospective buyers can also pose a challenge. You’ll have to agree on a schedule or hold an open house if the tenant agrees. There’s no assurance that either party can fulfill their respective duties and responsibilities in showing the rented property.


While putting up a tenant-occupied home can be challenging, with the right preparation and the proper treatment of your existing tenant, you can find ways to get the best deal for your property without sacrificing your interest or your tenant’s. Legal services are always an option. But, it’s better if you can talk about the situation and arrive at an understanding with the tenant.

Ready to sell your house with tenants? You might want to get the services of a reliable real estate agent like us, who are not your typical investor or wholesaler. We are actually licensed Realtors that have been licensed for nearly 20 years each, who have dealt with situations like this for clients and on our own rental properties we own and manage ourselves. So, if you would rather not want to deal with the situation of selling the tenant-occupied property yourself, or with an agency paying commissions, organizing appointments to show the property, or making any repairs, we are your answer.

Call us today to discuss your situation because we love to help! Visit our website to get to know us better:

How To Sell A Tenant-Occupied Home | Local Home Buyer CA was last modified: by