You might be under the impression that you can’t sell a property that you own if you currently have tenants living in it, but that’s not true. You can sell your Tennesee house or property with tenants and there are plenty of good reasons why you might want to.
You may have decided that you don’t want to be a landlord anymore. You may not want to deal with unruly tenants and renters and feel like selling the easiest solution. You might not be seeing the return on investment from your rental property that you hoped. Or perhaps you simply just need to sell your property fast to become more liquid. Whatever the reason, it’s understandable that you’d want to sell a property with tenants and not wait until they move out.
Whatever reason you might have for selling your property with tenants in it, you’ve got options for how you go about it. Let’s take a closer look at selling a property with tenants and what to do if you’re a landlord.
Can You Sell a House with Tenants In It?
When it comes to answering the question, “can I sell my house with tenants in it?” the answer is an unequivocal yes. There are many caveats to consider and you need to remember that the terms of the lease must be honored at all times. While you might be able to talk to your tenants about an early move, they aren’t required to if they are following the lease.
There are buyers interested in your Tennessee house with tenants because they might be real estate investors looking to flip the property or perhaps become landlords themselves. They might also want to buy the house to move into it when the current lease expires. So don’t think there isn’t a market for a house just because someone currently rents it.
Landlords Rights When Selling a Rental Property
Landlords need to be aware of their rights when selling a rental property in Tennessee to make the transaction as smooth as possible. Along with these rights, you should always consult your local Tennessee county and city ordinances to see if there are any specific rules to that area.
Landlords do have the right to sell a property with tenants in it, though they do need to make sure tenants receive appropriate notice based on the terms of their lease. Landlords must follow the terms of the lease but are well within their rights to terminate a lease with notice or evict a tenant if they violate the terms and the landlord follows proper Tennessee rental law procedures. And landlords should make sure that terms regarding a potential sale of the property are baked into the lease even if they have no intention of selling the property at the time to make sure everyone is covered in the event it does happen.
Renters Rights When Selling a Rental Property
Tennessee rental laws protect the rights of renters in many cases, especially when it comes to selling the property they reside in. Landlords are required to disclose any information about a potential sale to renters beforehand and honor the terms of the lease even if they plan to sell before it expires. Tennessee requires when security deposits need to be returned (within 30 days after a tenant moves out). And renters can withhold rent if they feel as though adequate repairs are not being done in a proper or timely manner. Tenants are protected in various ways, including fair house laws, protections against retaliation by a landlord, and protections for any property left behind after they vacate the unit, so landlords need to be very clear on all the rules and regulations when dealing with them, especially when looking to sell a Tennessee property.
Tips for Selling a Rental Property in Tennessee
If you’re going to sell a rental property in Tennessee, there are some tips you should keep in mind to facilitate the best sale possible.
First, make sure that you are making things easy for your current tenant. If you want to have showings, let the tenant know and ask them if there are preferable times. Let your real estate agent know that there are times they cannot show the house to buyers. And if there are any special requests, let the tenant know so they can plan accordingly.
When you do show the property, ask your tenant to leave the premises if possible. No one wants to walk around a potential purchase while the current resident is hanging out. It makes for a very awkward situation and you don’t want to put off any potential buyers who don’t feel comfortable. Feel free to give your tenant a gift card to use to get some food or drinks to entice them.
Make sure the property looks nice when showing it. If you don’t already, hire a cleaning crew or landscaper to come by and improve the curb appeal. It’s not the tenant’s responsibility to make the place look nice, so make sure you do what you can to make things look good for buyers.
Make sure the tenant is up-to-date on their rental payments and doesn’t seem to be in a position to cause headaches for the new owner. That could be a red flag to a potential buyer who doesn’t want the headache of chasing a tenant for rent, especially when they didn’t sign this person to a lease. If this feels like it’s going to be a problem, consider whether or not you can evict the tenant beforehand.
Sell the House with Tenants Attached
IF you’re going to sell the house with tenants attached, you’re going to want to make sure that everyone is aware of the situation. The first thing you need to do is notify tenants of the impending sale. Of course, they could react negatively, so you need to be prepared to deal with that. Stick to the terms of the lease when needed.
It’s good to point that even though you are selling your Tennessee house or property, your tenants have the right to stay there through the end of the current lease, regardless of whether or not it’s fixed-term or month-to-month. Unless they violate the terms of the lease you have to honor that commitment and inform any potential buyer of those terms as well. You might be able to get the tenant to leave early if you negotiate with them, but they are under no obligation to do so.
What Until Lease Expires
One of the easiest solutions is simply letting the lease expire if you have time to wait. This lets the lease run its course, gives the tenant the legal time to move out, and then allows you to do whatever you want with the property before selling it.
If your tenant is on a fixed lease with an end date that isn’t getting here soon enough, you should consult the lease to see if they are living up to the terms of the lease. If they aren’t, you could consider evicting them or terminate the lease with notice. This doesn’t mean that you should lie or make up fake violations, but if the tenant violates the terms due to things like drug use, guests staying too long, or destruction of property, you could have grounds to remove them. Be sure to consult Tennessee rental laws and be prepared that they could take you to court over the removal orders.
Make Agreement with Tenant
You can enter into a seller financing agreement with your tenant as an option. This means they can use their rent payments as down payments on buying the property. This could be a solution if they are interested in buying the house but don’t have the cash right now. Of course, you’ll need to be the only owner on the property (or have all owners approve the deal) and you’ll need to get your lender to sign off on the arrangement as well.
Offer House to Tenant
Sometimes when you’re looking for a buyer for your Tennessee property, they’re closer than you think. If you have a solid tenant who wants to remain in the house, you would consider selling the house to them. They’ll likely need to sort out financing and decide if owning instead of renting is for them, but it’s an easy solution to your issue if they can afford it.
Sell to a Cash Home Buyer
One of the best solutions for selling a property with tenants in Tennessee is to sell it to a cash buyer like Nexus Homebuyers. We can buy your property as-is, with tenants inside, and pay you cash for it. We buy properties in Knoxville and we buy properties in Nashville, too!
As soon as you contact Nexus Homebuyers, we get to work determining the value of the property and deciding how much we can offer. We don’t require any repairs and we don’t need you to remove any tenants, we’ll be happy to deal with the situation. We’ll make you a fair cash offer and it’s entirely up to you to decide if you want to take it. If you do, you also get to decide how fast we close on the sale. When it’s done, we put cash in your hand and let you move on with your life without the stress and hassle.
Selling a property with tenants might sound like a scary proposition but there are plenty of options to do it. If you’re looking for an easy way to sell your house with tenants in Tennessee that doesn’t involve repairs, evictions, or commission fees, contact Nexus Homebuyers today!