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Can Landlords Sell a Houston House With Tenants Living There?

We often work with landlords who are tired of being landlords, and, as a result, we get this question quite often. The short answer is, “yes, you have the legal right to sell the home any time you want.” You own it. It’s your property.

However, if you actually want the house to sell, the process can be tricky.

Offer The Home to Your Tenants

If your tenants are financially stable or are looking for a home in the future then you might consider offering them the right of first refusal. You might also do this if the home is occupied by family members or friends.

This can build a lot of goodwill with the tenants, whether they opt to buy the home or not. However, it also tips your hand.

Tenants who know the home is going to be sold can get very spooked. They start worrying that the new owner will raise the rent. They start worrying whether or not they’ll have to move. Spooking your tenants can jeopardize the good relationship you have with them.

Thus, offering the home to tenants, while respectful and kind, is nevertheless a risky move. It’s one we don’t always advise unless you are almost certain your tenants are willing to take you up on the offer.

Sell A House With Tenants: Don’t Spook Them

As Bankrate notes, tenants can do a lot to hold up the sale of the home. A tenant who doesn’t want to move can refuse showings or demand long notices prior to showings unless your lease specifically demands that they make the home ready upon demand. Delays can chase buyers away on the traditional home market.

Tenants may make the home unappealing. While some leases might give you leverage to compel your tenants to keep the home clean, others don’t address it. This means tenants who don’t want to move or feel they can’t afford to move can refuse to keep the home clean.

Even a tenant who is not actively and maliciously attempting to stay in the home might hinder you. A tenant with long hours might not have time to clean. Other tenants might sabotage showings simply because they are worried about strangers walking around. They might even worry about the safety of their family or belongings.

The presence of tenants can also spook buyers unless they’re looking for a tenant-occupied investment property. Buyers are well aware that tenants might damage the home as they leave, out of spite. They’re aware tenants may drag their feet when it’s time to vacate the property. Neither of these thrill a buyer who will need to live in the home after purchasing it.

Thus, many landlords prefer to keep quiet about the fact they’re selling the home. Unfortunately, it’s impossible to do this while placing the home on the open market.

Respect Your Tenants

Your tenants are not your enemy. In many cases they’ve faithfully paid their rent for many years. The potential sale of the home can come as an unpleasant shock, and your decision to do this will certainly cause them a great deal of unwelcome upheaval. They may even feel angry and betrayed.

Can they afford a new home? Will they be able to keep their kids in the same school? Will they be able to move in time when they’ve both got to work?

Empathy for all of these concerns is very important. Some landlords offer a financial incentive to get tenants to cooperate with the selling process. This can work, but it’s no guarantee that the tenants will work with you.

Trust Our Proven Process

These issues are why many landlords come to us. We don’t mind tenants in the home and know how to approach each situation.

Then, we help you to navigate the sale in private. From there, we’ll honor the tenant’s current lease. If there’s no lease, we’ll give them 30 days to vacate under Texas law. If they’re family members or friends we can give them even more time.

When you work with us, there’s no need to offer an incentive, which can lead to arguments about whether or not the incentive has been earned. Often, tenants feel they did everything the landlord asked while landlords feel the tenants didn’t meet reasonable standards of cleanliness or responsiveness.

In short, we can offer you a hassle-free alternative to selling a home with tenants in it.

Contact us for a free, no-risk quote within 24 hours.

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