Owning rental property is one of the best ways to make a great income while building your knowledge of investing and flipping. If you own a property that currently has tenants and you want to sell it then there are a few things you need to consider so keep reading to find out what you need to know when it comes to selling tenanted duplex property.
Try And Wait It Out
If you are just considering the sale then you need to think about the differences between selling a vacant property and selling a tenanted property. A vacant property will be much easier for you to find a buyer for and there will be less paperwork so this will likely make the sale much quicker. On the other hand, buyers act more cautiously and take into account many factors while buying tenanted property specially duplex or triplex house, so it make your job difficult for quick sale.
Make A Deal With Your Tenant
If you have the means to do with then consider making a deal with your tenant and ask them to move before their lease is up for a fee. There are a few ways you can offer to help them move out faster so consider some of these options.
Offer to pay for moving costs: Some people are willing to move and have a great place to go but they just need the time to get everything together and over there. Offering to pay for a moving company will take the burden off of them.
Offer to pay rental difference: The rental market can change quite a bit and your tenant may find that the rent has increased quite a bit over the last few years. Offering to pay for the difference between the current unit and their new unit will help the tenant by allowing them to keep the same rental cost for the remainder of the lease as they would have anyways.
Pay the first month’s rent and security deposit: The renter can likely use their final month’s rent that they would be paying to you for their final month’s rent at their new unit.
Check Out The Lease Type
If your tenant has a month-to-month agreement then the sale will be a bit easier for everyone to navigate and you’re more likely to find a buyer. The new buyer has a few different options when it comes to a monthly lease as opposed to a fixed lease.
For a month-to-month lease, the new buyer is able to keep the tenant in the property, raise the rent, or request that they leave the unit. The state of Illinois requires that a landlord give the tenant 30 days’ notice if they choose to terminate the lease but no reason has to be provided.
A fixed lease sale becomes a little trickier due to state laws but it can still be possible. Illinois state law requires you to transfer the existing lease along with the security deposit over to the new buyer for the rest of the tenant’s lease and maintain the same terms. Many new buyers are looking to make changes to the property so you are more likely to appeal to investors that are willing to wait for the lease agreement to be up.
Keep A Good Line Of Communication
Selling your property while the tenants are still living there means that you have to work with them as much as possible so try and keep the lines of communication open as much as you can. You will get much more success if you are upfront about selling with your tenants as soon as you make the decision. Let them know informally that you are selling and explain to the tenants what your timeline will look like so they can be prepared.
In the best situation, your tenants will be willing to work with you when it comes to everything necessary for selling the property. You will need to get interior photos of the unit in a clean state, get inspectors to come through the unit, and arrange for buyers to come in for showings. Having a good relationship with your tenant will make all of these much easier to achieve.
In a bad situation, you might run into a tenant who is refusing to move from the property. This can become an issue very quickly and it can become even worse if you list the property and it sells before the tenants have moved. This is often called a holdover and it might require legal intervention that no buyer will want to touch.
There are a few things you need to think about when it comes to selling your property and it all depends on the renters you have and the agreements you have already made. As long as you stick to the local laws and keep an open line of communication for everyone, you will be able to sell your duplex property in no time.
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