Property Management, Tenant Selection, Real Estate News & Tips

Renters’ Rights When Your Landlord Sells Your Rental Home

By on June 16, 2017 in Education with 33 Comments

 

selling a rental propertyQuestion: I just found out my landlord is selling my rental house – what does this mean for my housing situation?

Answer:

If you rent a home and you discover your landlord is selling the property, don’t start panicking (or packing) just yet. If you signed a lease agreement, your current and future landlord will have to honor the terms.

Term Lease Agreement

A term lease agreement is a housing agreement between landlord and tenant for a designated amount of time, typically 6-months to one year. If you learn about the sale of your rental property, and you still have a few months left on your lease agreement, your new landlord will not be able to kick you out.

When a buyer purchases a renter occupied home, he must agree to take over the lease and honor the terms the tenant signed. A buyer can ask the renter to sign a new lease with him, but technically the tenant does not have to.

Exceptions to Honoring a Term Lease

The only exception would be if your lease agreement has special conditions regarding a property sale. If your state allows it, your lease could contain language that says something along the lines of, “in the event of the sale, the current lease agreement will be void once a new owner takes over the property”. While it is possible that your lease could have this type of property sale clause, they are not very common.

Another exception would be if you and your landlord mutually agree to end the lease agreement, and you agree to move out on a designated date. In these cases, the tenant can have some leverage to ask for relocation fees from the landlord, since you are doing them a favor by moving out.

Month-to-Month Lease Agreements

If your current lease agreement is a month-to-month tenancy, you have less security when it comes to staying at the property during a sale.

If your landlord wants you to move out prior to an official sale, he merely has to provide you with proper notice to end tenancy and move out on a specified date. Most states require a landlord to give a tenant anywhere from 30-60 notice informing a tenant that tenancy will end and they need to move out. Some cities have even more lenient timelines, for example, landlords in Portland, OR, must give their tenants 90-days notice to vacate.

Remember, these notices to vacate are not evictions. They are friendly terms of ending a rental tenancy with your current landlord. While it can be shocking to learn you have to move, that is one of the realities of being a renter, your landlord can choose to sell his rental property at any time.

How to Handle the Sale Process

Talk to your landlord. Hopefully, your landlord will be upfront about his intentions to sell the property and keep you informed as to whether he hopes to sell to another investor who will keep the property as a rental. He could be selling the property for any number of reasons, and the more friendly you are during the process, the more likely he will be to encourage the new buyer to keep you as a long-term tenant.

Working with a Real Estate Agent

A potentially frustrating part of living in a rental that is in the process of being sold is dealing with showings, inspections, and any property upgrades seller decides to complete the sale. These types of typical selling activities can be a huge disruption to a renter who wants to live in peace.

A lot of tenants feel uncomfortable with the idea of strangers constantly coming through their home during open houses and showings. Unfortunately, there is little a tenant can do to complain about this part of the process. Your landlord must give you 24 hours notice (or whatever the notice requirement for your state is) before a real estate agent, inspector, or anyone shows up and enters your property – but he does not have to accommodate your request to always be present during these events.   Try to work with your landlord to come up with a solution where you feel comfortable and your landlord is still able to sell his home. Remember the more accommodating you are during the sale process, the faster it could be sold and this whole ordeal will be over.

It is not acceptable for a real estate agent to just show up and enter the property unannounced. They must provide advanced noticed according to your state laws for entering the property. If this keeps happening, you need to speak with your landlord so he can relay the laws to the agent who may be unaware.  Here are some tips for agents about the Best Practices for Selling Renter-Occupied Homes.


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About the Author

About the Author: Kaycee (Wegener) Miller manages marketing and media relations for Rentec Direct, bringing a unique perspective to the world of property management and proudly shares industry news, products, and trends within the community. .

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There Are 33 Brilliant Comments

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  1. Nick says:

    My wife and I were just informed by the landlord that they intend to sell and that they will not be extending our lease which expires 12/31. We have found a new place that is available but our current landlord won’t let us break the lease early in order to move into the new place. Is there any legal grounds that would allow us to move early without penalty? We don’t want to be moving through the holidays if we can do anything about it. Thank you for any advice!

    • Hi Nick,

      Most states will not let a tenant break the lease early if the property is being sold. The buyer will have to honor the current lease terms but does not need to extend the lease agreement once it expires. It totally sucks that your current landlord is not being reasonable about helping accommodate your situation so you can move out and make the holidays easier. I would just try to keep reasoning with your landlord and remind them of the benefits of showing an empty home, vs a renter-occupied home.

      Alternatively, how do you know that the new buyer will not want to rent out the house? You could be able to rent your current home with a new lease agreement with the new owners?

      • Susan says:

        I know this is old news but I read this and I thought that sucks. I hope things worked well for you. Some people just are not nice. I am convinced it is because of mean people we have over 60,000 laws in this country. Peace Out.

  2. Andrew says:

    My wife and I live in an apartment that has been sold. The realtor added a clause before our original signing while we were out of the country getting married that says we must vacate 90 days after notice from our landlord that it has been sold, but in the email, mentioned we have ‘up to 90 days’.

    The building was apparently sold before we even signed the lease according to a realtor neighbor, but the landlord has only mentioned it was sold this week (just 3 months after moving in) so we are preparing to move in the next 30 days to rid ourselves of this place. However, the lease agreement is vague in that it says we need to vacate in 90 days, so the landlord is saying we need to stay the full 90 days when the email from the realtor clarified that we have ‘up to 90 days’ to vacate. To clarify, the realtor was the one who drafted the lease agreement.

    My question is, do we have any legal ground to get out of this lease as soon as possible rather than wait the full 90 days like the landlord is insisting? The landlord is well known in the area for being terrible and trying to sue for everything. Ex: sue the neighborhood for trying to remove their vehicle from a no parking zone, planting her own trees in a common area and threatening to sue for damage if they were to be removed…

    I suspect the landlord only rented out the apartment because they wanted a few months of rent between selling the apartment and closing.

    • Check your state laws. Some state’s allow renters to break the lease once a property has been sold. Other states do not have statutes about renter’s rights when a property sells. I don’t think it matters who drafted the lease agreement, if you signed it and the landlord signed it.

  3. charles says:

    Hi we just found out that the gentleman that rented us the house had no right to do so we have a 6 month signed lease the house was foreclosed on he told us not to worry about it now we have to move should he be responsible for the lease amount or anything

  4. Jannie says:

    Is there any state law that requires a notice in advance before a landlord sells the property? I live in a rental house, and he just sold it to his son.

    • I am unfamiliar with any state laws that require an owner to provide advanced notice before a house is sold. You would be entitled to advanced warning if any conditions in the lease agreement are changing, like if the rent is increasing or if the new owner wants you to sign a new lease.

      If you are on a term lease (like 6-months or a year) the new owner has to legally take over the lease and continue to uphold the lease agreement terms you agreed to. If you are a month-to-month tenant the new owner can change conditions of the lease if proper notice is given. The notice timeline depends on your state and local laws.

  5. Jannie says:

    What is the timeline to get my deposit back from the owner who just sold the house I rent?

    • If the lease is transferring to the new owner you will not get your deposit back, the deposit will transfer to the new owner as well. If you are worried, ask your landlord for a written notice stating that the deposit you paid on xxx date is being transfer to the new owner and keep it for your records.

      If you are moving out of the property because the property sold, you will recieve the deposit back based on your state laws. States typically require deposit refunds to be issued 10-40 days after you move out.

      • Jannie says:

        I am not moving. It is a month to month payment. No lease

      • Susan says:

        My lease expired and I have no rental agreement what happens to my deposit? How do I safeguard myself from not being held responsible for damages the new owner may need to repair because the old owner did not repair damages because of acts of God or because of contracters error. For example there are windows that need repaired they do not open. The old owner came in to fix them and never finished them.Fences need repaired. Calking was not completed. I have a 2000$ deposit I have done no damage. I would like to negotiate on the deposit who do I do this with?

        • Do you have pictures or some other evidence of the move in condition that will protect your deposit with a new owner? I would ask the new owner to come over asap to conduct and inspection. It should be pretty obvious what was damage from lack of maitnenance from the previous owner, compared to tenant caused damage, vs. standard wear and tear.

          • Susan says:

            Thsnk you,

          • Susan says:

            I am at a stand still. Other then moral laws I can find know RCW or law that protects me. If you can find the RCW that states when a place is sold the deposit transfers to the new owner please point it out to me. Yes I have pictures. The new owner closes on April 3. I rented threw a property manager. The new owner is moving into the unit I live in. I recieved a notice to terminate tenancy from the property manager termination date April 30th 2018. From my understanding my deposit should transfer to the new owner. The new owner nor is the seller represented by the property manager I rented from. If I move out before 1 April can the property manager still hold me responsible for Aprils rent? If I do not move out and wait until the 3rd of the month to pay the rent who do I pay the rent for April to. The new owner or the property manager. I am looking at a loss of 3400$ if i do not find some way to protect myself. I was just informed by the property ma ager that I will be held responsible for Aprils rent and that they hold my deposit and that I will be charged for the changing of the locks and the cleaning of the carpet. There has to be some kind of law that protects me.

  6. Anthony herl says:

    The rental house we live was sold October 31-2017 wasn’t informed till November 3-2017 we already paid our rent to old landlord now new landlord said we own them rent for November. We have cancelled check from where old landlord cashed it November 8-2017 took receipt out to new landlord an show them told us we was responsible to get it back from old landlord. Try calling old landlord to ask about it he will not answer or call us back. Need help bad

    • It sounds like you already paid rent before you were informed of the change of ownership. If you can prove this, then a judge might side with you if the new owners try to take you to court for non-payment of rent. I would contact your local housing authority to get advice and help for your specific situation.

  7. Colleen says:

    I live in Wisconsin. When I moved in my rental property 8 years ago I signed a one year lease. I have never signed a lease after that. Now my landlord is selling the house. Seeing the lease I signed was for a year and I have not signed anything after that year was up, what are my options? I am going to move and not wait to see what happens with the new owner. Can I just leave anytime or do I have to give the landlord a 30 day notice?

  8. Lyssa Kay says:

    My landlord sold my rental 2 days after letting me know she was going to sell. It was sold to a person who is going to flip it. He paid cash for it. I still have a month on lease with old landlord. Will I have to move in a month, or can I fight for the 60 day notice they need to give for wanting me out?

    • The new landlord will assume the lease and will still need to give you proper notice to move out. If your state requires a 60 day notice to vacate, the new landlord will have to respect that law.

  9. deashiahawkins@gmail.com says:

    HI me and my kids and boyfriend just moved in a property in the end of feb 2018 we just found out that the landlord sold the house the rent is due and my arrangement with the other landlord is to pay the rent when i get paid but i didnt pay the rent because the old landlord said she gave them my deposit and when i told the new landlord that i couldnt pay the rent until nest week she told me i had 30 to move and that i want get my deposit back cause they going use for this month rent .. do i have the right to get my deposit back and do the new landlord have the right to evict me

    • She should give you a notice to cure or quit. Which gives you XX number of days to pay rent before she can move forward with an eviction. If you pay the rent, then she can still ask you to vacate without cause (the standard 30 day notice) and you would be able to get your deposit back, since you are current on rent.

      If you don’t pay rent, your landlord can use your deposit to cover any unpaid rent charges. And if you don’t pay rent on the day the lease says, your landlord can move forward with a pay rent or quit notice. The new landlord doesn’t have to honor any verbal agreements you had with the old landlord. I would get any arrangements in writing.

      • deashiahawkins@gmail.com says:

        ok so do i pay the new landlord or old landlord ? and can the old Landlord take my deposit ? and can the new landlord evict me

        • The old landlord should have transferred the deposit to the new landlord. And it would make sense to pay the new landlord if he currently owns the house and was the one issuing the notice. I would try to have a productive conversation with the new landlord asking to straighten the situation out and start the relationship off on good communication. You definitely need to talk to the new landlord before paying any money though, so you know your funds are going to the right person. Also ask what is happening with your current lease agreement. The new landlord should take over all terms of the current lease.

  10. charley says:

    Our landlord has decided to sell and though our lease requires 24 hours notice for entry she has instructed her realtor to ignore it. Showings have been regular almost daily and with little notice. We asked her to consider allowing us to leave the lease 30 days early so that she could properly prepare the home for sale and we wouldn’t have to subject our family to all that comes along with the sale of a home. She was not willing to make that accommodation because she stated sh needed our money for her mortgage payment. She has also decided to move forward with trying to “stage” clean, paint, etc. while we still hold the lease until the end of June. She knows we have made a home purchase of our own so she considers feels that even though we technically have a valid lease to the end of June she feels we shouldn’t be there so that she can make the property as she wants for sale and have us pay for things that technically qualify as normal wear and tear..for example my teenage daughter used small thumbtacks to hang a poster, the holes are barely viewable and are barely more than the length of a car key ( there is nothing in the lease that says we cannot hang anything but we have avoided it just in case, anyhow she had her property manager do a surprise inspection and is demanding we have a licensed professional paint the entire wall immediately. Things like this. We are at a loss and just by repeatedly asking for the notice in our lease she has dubbed us “problem tenants” and has become very hostile and forceful in her demands. We have been model tenants for 18 months (we were relocated from another state for my husband’s job) and are struggling with how to handle the onslaught of daily demands.

    • On no, this sounds terrible. From my understanding of typical rental laws, the owner MUST give you 24 hour notice before entering the home. You should document each instance in which she or her representative (ie realtor) have not given this notice. You do not need to return the property to move out condition mid-term. So it is not allowable for her to require you to paint the walls while you are still living there. I would talk with your local housing authority and even with a lawyer. An official letter from an attorney asking the owner to uphold the condition of the lease and respect your state’s housing laws can be very powerful and can help you live out the remaining lease term in peace.

  11. eugenia says:

    hi i live in an apartment. the landlord sold to a new company. when i completed the estoppel form i wrote that i will finish my contract when the apartment be sold. now, the new landlord does not recognize what i signed in that estoppel form. have i to continue the contract with a new landlord if i never signed a lease with them ? can i be obligated ?

    • When a rental property is sold, the lease agreement typically gets transferred to the new owner and the tenant is required to fulfill the lease term with the new owner.

  12. jeff steinman says:

    my lease says I must give 60 days notice to my landlord upon expiration of my lease if I wish to vacate the apt. If notice is not given the lease will automatically renew for another year. my landlord is selling the property. when its sold can he terminate our lease/

  13. Linda says:

    Lease was assigned when rental property sold and security deposit transferred to new owner. Can new owner deduct from security deposit damages occurring before lease assigned?

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