Author Topic: Selling Tenant Occupied Duplexes  (Read 2168 times)

bmiles62

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Selling Tenant Occupied Duplexes
« on: December 07, 2019, 12:04:40 PM »
Looking for some guidance here. My sister and I were just given three rental properties from my Dad. Two duplexes and a house. We have managed the properties for years and now want to sell them. We actually just sold the house in three days. (It was empty. Closing Jan. 3rd.) The duplexes are full and three of the tenants are on month to month leases and the 4th tenants lease is up in May 2020. The one with the tenant that has a lease til May is in great shape and both renters are pretty neat and the house would probably show well. The other duplex needs some updating and both of those tenants are on the messy side so the units will not show well. Trying to get some opinions on how to proceed. There are no mortgages on the properties. The duplexes are right across the street from each other so once I tell one tenant the rest will know that we are selling. So my question is should I give 30 days to the unit that needs repair and has messy tenants or do you think a prospective buyer would rather start with renters in place? Anyway any ideas on how to get these properties to market would be appreciated.

Chiron

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Re: Selling Tenant Occupied Duplexes
« Reply #1 on: December 11, 2019, 01:35:42 PM »
Try selling on Roofstock.com.  They specialize in selling tenant occupied housing to investors nationwide.

rothwem

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Re: Selling Tenant Occupied Duplexes
« Reply #2 on: December 12, 2019, 08:02:49 AM »
So I guess the goal is to sell with tenants, and you want to be sneaky so they don't leave before you sell?

I wouldn't worry about the tenants moving out.  I'm not wild about inherited tenants as a general rule, and I don't know many investors that are.  If I didn't screen them, I have no idea if they're worth a shit, and the rental histories can easily be fabricated.  Also, a vacant unit is much easier to sell since you can see the whole thing without bothering people living there or moving their stuff. 

lhamo

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Re: Selling Tenant Occupied Duplexes
« Reply #3 on: December 12, 2019, 10:51:14 AM »
Give notice to the messy tenants immediately so that you can clean/fix their units up on your own schedule without them being in the way.  If you want to phase the work and it is cost-effective to do so you could give notice to one first and let the other stay, but it is probably going to be easiest/fastest/cheapest to rehab both units at the same time as you can have one set of contractors working on both units in the same timeframe.

No need to give notice to the other tenants.  The buyer can decide if they want to offer new leases.  If the unit is in good repair it should re-rent easily if the current tenants decide to move out.

malacca

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Re: Selling Tenant Occupied Duplexes
« Reply #4 on: December 16, 2019, 10:50:16 PM »
Decent duplexes sell better with one side not occupied. Mortgage rates are much lower for owner occupancy. And House Hacking is huge these days with many first time buyers looking for a duplex.

So give the tenants notice.

Also spending just a bit on cleaning, paint and floorings will give you at least a 3X return.

Proud Foot

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Re: Selling Tenant Occupied Duplexes
« Reply #5 on: January 02, 2020, 01:48:09 PM »
If the layout makes it feasible, you might also consider giving the current tenants the option to buy their unit from you.

bacchi

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Re: Selling Tenant Occupied Duplexes
« Reply #6 on: January 02, 2020, 02:09:50 PM »
If the layout makes it feasible, you might also consider giving the current tenants the option to buy their unit from you.

My SO's parents just did this. They added a condo covenant to their duplex and sold one half. The remaining half is still renter occupied.

It's expensive with all the lawyer fees so it's probably not a good idea unless it's a high dollar duplex.

stachestache

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Re: Selling Tenant Occupied Duplexes
« Reply #7 on: January 03, 2020, 11:12:58 AM »
Where are the properties?

what is market value for them?