You may think acquiring a rental property is hard, wait till you try to sell one. For most landlords, the process can be a bit confusing whether their house is occupied or vacant.
Here are a few tips and tricks to help you sell property better and without any hassle.
Marketing an Engaged Property:
It’s a misconception among landlords that they can only start advertising about their property till it’s completely vacant. You can start marketing your property whenever you want, and the only thing you need to do first is to give your tenants prior notice.
You need to give them the notice and make it clear to them that they will be dealing with a new landlord soon, or you will sell the house only when they move out. All in all, you and the tenant both need to be on the same page before starting the marketing process.
When you market any property, you need to schedule showings as well. However, you can schedule showings on your own; you need to loop in the tenants as per state laws and regulations. Your lease should mention the notice time, and you should abide by it to avoid any issues.
Open communication will help you a lot in keeping things straight with your tenants. The tenant should be able to ask any questions regarding the showing as well as the sale of the property.
Selling an Engaged Property:
Again a widespread misconception is that you can’t sell your occupied rental property, but if you don’t have any such clause in your lease, you are very well in your right to sell the property.
- Two scenarios occur when you try and sell an occupied or engaged property.
- You tenants move out earlier than their lease agreement
Most of the time new buyers accept the property with an active lease, and the tenants also agree on switching landlords.
Among the two scenarios, the latter one is most common. If you aren’t comfortable selling your occupied property, you can, at the very least stage the property to lure in high bidders.
Early Move-Out Encouragements:
Many landlords aren’t comfortable in showing or marketing an occupied property, and since the tenant wouldn’t like moving out before time, the landlord is stuck. You can either persuade the tenant to move out early or offer him incentives to get your way. Following are the most common incentives that landlords use to make their tenant move earlier than their due date.
- A considerable cash offer
- Offer to pay their moving cost and save them money
- To wave off the security deposit completely
The cash offer you make is on you; there is no hard and fast rule about how much should you or shouldn’t you pay to make your tenant move. By law, there is nothing you can do to make your tenant leave if he doesn’t wish to, before his time. Tricking or forcing your tenant might get you into deep trouble.
Early Termination Lease Clauses:
If you are in the habit off selling your rental properties for a profit, or as a business, you should consider putting an early termination clause in your lease agreement. With the clause stated clearly in your lease agreement, the tenant will know that this is a possibility and will be prepared for it. Following should be the basis of your termination clause.
- The time of notice about 30 and 90 days, should be stated
- The incentive to be offered to the tenant if the lease gets terminated
- Can the tenant say no to termination or not
Your lease terms can help you a lot if ever you need to sell an occupied property.