It is easy to manage properties when you are in the town. You can see the home and make sure that it is adequately maintained. You can check out with the tenants for matters related to rent and repairs.
It is difficult to manage a property when you are living out-of-state. Most people don’t buy an out-of-state property to rent it out. Most of the time, they are accidental landlords who have to inherit a house and don’t know what to do with the property.
In some cases, you move out of state because of job, illness, or divorce and you must leave home behind. Instead of leaving the house vacant, you choose to use the property as a source of income. You become a landlord, and the rental income is used to pay the mortgage.
If you are facing this situation and you would like to move out, you have a few options. You must be ready to capitalize on the equity of a rental property. Doing so will give you access to a reasonable sum of money that you can use to buy or pay the mortgage on your new home.
So, how do you free yourself from the responsibility of managing two homes?
You sell the first one, of course.
However, selling a tenant occupied property is different from selling a vacant house. You must understand tenant laws, your rights and understand where to the draw the line between rights and responsibilities.
Review the Lease Terms
You should be aware of your agreement with the tenant. As a landlord, you have the right to sell your home whenever you want. However, you cannot do that, at the cost of violating laws. There are two types of rental agreements:
In this situation, the lease renews every month depending on the tenant-landlord relationship. If the house is safe for living in and the tenant pays rent on time, then it is okay for both parties to continue the relationship.
These types of agreements allow you to terminate the lease at the end of the month. You are required to inform the tenants in advance. You should send them a notice (30 or 60 days ) telling them when the lease ends and when they are required to leave the house.
Depending on your relationship and lease terms, you can show the property to potential buyers while the tenants are still living in the house. It is always best to give notice of 24 hours before bringing the visitors. In case, your lease doesn’t allow this option; you should wait until the tenants leave your house.
The fixed-term lease expires on the given date in the contract. The existence of an early termination clause gives you an exit strategy.
You cannot terminate the contract unless the clause is available in the deal and you fulfill the criteria. Other times, you can cancel the agreement if your tenant violates the terms of the rental agreement.
If you would like to show home to potential buyers, you must obtain permission from tenants. Send them notice before you bring the prospective buyers.
Selling to an Investor
You cannot sell your home while tenants are still living inside. For this reason, you cannot advertise property to local buyers.
Your option is to sell to an investor. Real estate investor can buy the property while tenants are living inside the house. For this purpose, the new owner must honor your contract with the tenant.
The benefits are that you get quick access to cash. A real estate cash buyer such as Habitat Developers can buy your house as-is for a cash price within days. We understand your concerns, and therefore, we’re willing to buy the house even if it is occupied by the tenants. Selling to us does not cost you extra money. You can get the best possible fair price in the shortest time possible without paying closing costs, commissions, or out-of-pocket costs.