I recently received a call regarding an investor wanting to sell a rental property. There is a current lease on the property which doesn’t end until later in the year. His goal is to sell the house in a timely manner while not having to cover mortgage payment once it is vacant. The question became, when do you put the house on the market?
After, researching homes that are currently active, under contract and recently sold in the area and days on market, it became clear of the options available.
This scenario has come up before with other clients with investment properties.
- Here are typical solutions
- Sell the property and the current lease terms transfers to the new owner
- Wait until lease is up and sell the house
- Ask the tenant if they would like to terminate lease early with no penalties
- Come to an agreement regarding moving out when the house sells
Reviewing the lease for when the tenant agreed to allow showings, is a good first step. Having an open conversation with the tenant about what your goal and plan is could make this a win-win for both.
If the lease only permits a lock box within the last 30-60 days of the lease and it appears it will take longer to sell, then offering a discount on rent in exchange for keeping the house very clean and allow showings may be a good solution.
It is a combination of these solutions that my client and I will be implimenting.
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