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Then DO NOT make an offer on any property with a tenant in it.
Especially now. The burden is on the seller to fix this problem.
This^^
It’s hard getting a tenant out, and I don’t even want to imagine what it’s like now. I heard way too many horror stories when we looked at a place that was tenant occupied, but of course none from the selling agent. Her first tell was the tenant wanted to stay if we’d have her. I followed the property and it fell out of escrow twice before I stopped paying attention.
A common story I heard, and a recommendation from both my lender, who’s a good friend with 30 years in the business, and my realtor (my mom), was don’t be surprised if you end up giving them a couple/few grand to cover a month’s rent and moving costs to get them the heck out of there. And play nice if you don’t want the place thrashed.
I’m sure tenants leave all the time with the place looking nicer than you found it, but do you really want to risk it?
As usual, so much very poor advice to the OP from saber-rattlers with no knowledge of the property or process and no skin in the game.
Of course you can buy a tenant-inhabited property successfully. It happens all the time.
Review with your agent the terms of contract.
All personal property that is not part of the conveyance should be removed. All, seller-owned or tenant-owned personal property.
House should be vacant and clean with working utilities for a final walk-through before closing. If it is not, you don't close. If the seller materially breaches the contract, your contract should stipulate that you will receive ALL funds back that you invested in the purchase attempt.
You may want a local attorney to draft a few sentences for those and other points, if the contract form is not clear to you.
But buying this property should not be difficult, 99 times out of 100. Heck, I wish dealing with Owner-Occupants had as good a success rate.
Last edited by MikeJaquish; 06-22-2020 at 06:03 PM..
I am currently selling my one-and-only rental property, and horror of horrors, it still has tenants in it. (OK, they closed on their own house 4 days ago, so they are definitely moving, but they didn't have an exact closing date when I put the house on the market.) We showed the house for 3 days, I got 6 offers, and I accepted the best one. I'm glad that people weren't afraid to make offers to a house with tenants in it!
I think it makes a difference (or could) if the tenants gave notice that they were moving, then the house was put up for sale (as was the case in my situation). If the owner decided to put the house on the market and the owner gave the tenants notice that they had to move -- which of course is completely his/her prerogative unless the lease specifies otherwise -- I can understand how that could be potentially more problematic. OP, do you know who gave notice -- the tenants to the owner or the owner to the tenants?
I do agree that this is a MUCH easier process if you're in close proximity to the new house (I live just 10 minutes away from the rental house).
As usual, so much very poor advice to the OP from saber-rattlers with no knowledge of the property or process and no skin in the game.
Of course you can buy a tenant-inhabited property successfully. It happens all the time.
Review with your agent the terms of contract.
All personal property that is not part of the conveyance should be removed. All, seller-owned or tenant-owned personal property.
House should be vacant and clean with working utilities for a final walk-through before closing. If it is not, you don't close. If the seller materially breaches the contract, your contract should stipulate that you will receive ALL funds back that you invested in the purchase attempt.
You may want a local attorney to draft a few sentences for those and other points, if the contract form is not clear to you. But buying this property should not be difficult, 99 times out of 100. Heck, I wish dealing with Owner-Occupants had as good a success rate.
Wait, are you really saying 99 out of 100 times sales go smoothly with tenant occupied homes? And that they’re easier to deal with than owner occupied homes?
Wait, are you really saying 99 out of 100 times sales go smoothly with tenant occupied homes? And that they’re easier to deal with than owner occupied homes?
1. Yes. Tenant-occupied homes sell.
2. To some degree, but, no not meant as a firm statement. We do know that people who are emotionally attached to their nest can be harder to deal with than tenants.
Bottom line:
People without a clue are spreading unnecessary doom and gloom on the OP.
I had a bad experience with a tenant-occupied property I was planning on buying in a condo building. I know this experience isn't a reflection of every single tenant occupied property purchase.
I never met the tenant, but things were going well, until they weren't. It was a luxury condo, and the tenant was on housing assistance and a below-market rent. At the last minute, they discovered they couldn't find an equivalent apartment anywhere for the same price and decided they wanted/needed to stay. They had a lease for an additional 8 or 9 months. It was a foreclosure, so the bank threw them a ton of money to move out, and they actually refused it. I ended up walking away from that deal and lost some money in the process. A short while later I ended up buying another foreclosed unit in the building for a sweeter deal, so it worked out in the long run.
Funny story but unbeknownst to me, about 4-5 months later, I ended up going on a date with the tenant after meeting her in the condo gym. I found out several dates later she was the tenant in the unit I tried to buy. Seemed like the sweetest girl ever. Stopped seeing her and she never knew who I was.
Wait, are you really saying 99 out of 100 times sales go smoothly with tenant occupied homes? And that they’re easier to deal with than owner occupied homes?
I think 99 out of 100 times, people will abide by the contracts they sign, if the terms are clear.
Under the terms presented here.... the tenants have already been given notice and have committed to leave by the end of July. This OP wants to close in the middle of August. ~ Two weeks later.
Under those terms... 99 times out of 100, good people working the problem can make that happen, and smoothly.
I had a bad experience with a tenant-occupied property I was planning on buying in a condo building. I know this experience isn't a reflection of every single tenant occupied property purchase.
I never met the tenant, but things were going well, until they weren't. It was a luxury condo, and the tenant was on housing assistance and a below-market rent. At the last minute, they discovered they couldn't find an equivalent apartment anywhere for the same price and decided they wanted/needed to stay. They had a lease for an additional 8 or 9 months. It was a foreclosure, so the bank threw them a ton of money to move out, and they actually refused it. I ended up walking away from that deal and lost some money in the process. A short while later I ended up buying another foreclosed unit in the building for a sweeter deal, so it worked out in the long run.
Funny story but unbeknownst to me, about 4-5 months later, I ended up going on a date with the tenant after meeting her in the condo gym. I found out several dates later she was the tenant in the unit I tried to buy. Seemed like the sweetest girl ever. Stopped seeing her and she never knew who I was.
Funny story - it's a small world!
The guy who hit me in my mother's car and totaled it in high school..... asked me out a few weeks later. Not as random as your example, and I didn't go.... but it would have made an interesting story about how we met.
It’s hard getting a tenant out, and I don’t even want to imagine what it’s like now. I heard way too many horror stories when we looked at a place that was tenant occupied, but of course none from the selling agent. Her first tell was the tenant wanted to stay if we’d have her. I followed the property and it fell out of escrow twice before I stopped paying attention.
A common story I heard, and a recommendation from both my lender, who’s a good friend with 30 years in the business, and my realtor (my mom), was don’t be surprised if you end up giving them a couple/few grand to cover a month’s rent and moving costs to get them the heck out of there. And play nice if you don’t want the place thrashed.
I’m sure tenants leave all the time with the place looking nicer than you found it, but do you really want to risk it?
THIS!!
My buyer bought a triplex and one of the tenants refused to move or pay rent.
It took us NINE MONTHS to get him out. Nine months.
But again (to quote myself -- which I don't normally do) ...
Quote:
Originally Posted by karen_in_nh_2012
I think it makes a difference (or could) if the tenants gave notice that they were moving, then the house was put up for sale (as was the case in my situation). If the owner decided to put the house on the market and the owner gave the tenants notice that they had to move -- which of course is completely his/her prerogative unless the lease specifies otherwise -- I can understand how that could be potentially more problematic. OP, do you know who gave notice -- the tenants to the owner or the owner to the tenants?
I do agree that this is a MUCH easier process if you're in close proximity to the new house (I live just 10 minutes away from the rental house).
I hope the OP comes back and answers that question I bolded as the 2 situations are VERY different.
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-- which I don't normally do) ...
