Author Topic: telling tenants we're selling  (Read 5370 times)

c-kat

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telling tenants we're selling
« on: February 15, 2015, 03:36:48 PM »
Hello,

One of the properties my husband and I rent out was never meant to be a long term rental. We used to live in it and rented it out when we bought a new home because the market wasn't very good and we didn't want to loose money. It didn't cash flow much, but the point was just to keep it until we could sell. Luckily we had good tenants who have kept it in perfect condition.

Because oil has fallen and it is a huge part of the Canadian economy interest rates have fallen to record lows, reviving the resale market where we live in Ontario. We really need the money for upcoming fertility treatments and so have decided to put it on the market next week.

In Ontario you can't ask a tenant to leave because you are selling. You can put the house on the market, with them still renting it and can only ask them to leave once you've accepted an offer at which time you must give them 60 days notice before the new owner can take posession.

We have to go tell our tenants that we are selling, but are looking fro advice on how to deliver the news. We need their cooperation for showings to perspective buyers, pictures etc. We originally told them we'd rent it out for a number of years but only just found out about the fertility issues.

Thanks

KD

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Re: telling tenants we're selling
« Reply #1 on: February 15, 2015, 03:43:10 PM »
Go with an option for them to buy it all laid out in your head and possibly even the paperwork for a contract in hand/car.  Perhaps they'd be interested in purchasing.  Give them first option to buy.

c-kat

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Re: telling tenants we're selling
« Reply #2 on: February 15, 2015, 03:51:13 PM »
Go with an option for them to buy it all laid out in your head and possibly even the paperwork for a contract in hand/car.  Perhaps they'd be interested in purchasing.  Give them first option to buy.

We can offer them that for sure, but they are a retired couple, who have rented their entire lives, so probably won't want to buy it.

Carla

mydogismyheart

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Re: telling tenants we're selling
« Reply #3 on: February 15, 2015, 03:57:18 PM »
I've seen in listings before where a home has a good current tenant and they put that in the comments.  Doesn't mean the new buyers have to continue to rent to them... but can be an option.  An investor might be attracted to it because it already has a good tenant that would like to stay long term. No guarantees, but something you can offer as part of the listing of the home.

GizmoTX

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Re: telling tenants we're selling
« Reply #4 on: February 15, 2015, 03:57:52 PM »
Giving them the first option to buy is a graceful way to broach the fact that you need to sell & want their cooperation to show it. No one wants to be told they have to leave, even with 60 days notice, & you will have a tough time selling without their cooperation.

Annamal

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Re: telling tenants we're selling
« Reply #5 on: February 15, 2015, 04:25:49 PM »
Hello,

One of the properties my husband and I rent out was never meant to be a long term rental. We used to live in it and rented it out when we bought a new home because the market wasn't very good and we didn't want to loose money. It didn't cash flow much, but the point was just to keep it until we could sell. Luckily we had good tenants who have kept it in perfect condition.

Because oil has fallen and it is a huge part of the Canadian economy interest rates have fallen to record lows, reviving the resale market where we live in Ontario. We really need the money for upcoming fertility treatments and so have decided to put it on the market next week.

In Ontario you can't ask a tenant to leave because you are selling. You can put the house on the market, with them still renting it and can only ask them to leave once you've accepted an offer at which time you must give them 60 days notice before the new owner can take posession.

We have to go tell our tenants that we are selling, but are looking fro advice on how to deliver the news. We need their cooperation for showings to perspective buyers, pictures etc. We originally told them we'd rent it out for a number of years but only just found out about the fertility issues.

Thanks

Remember to express gratitude for the way they have kept the house (and offer references if they want to start hunting for another place to rent).
Maybe offer a slight reduction in rent for the inconvenience as well? I guess that would depend on how heavily you are likely to be showing the place and how much of their daily routine will be disrupted.

bigalsmith101

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Re: telling tenants we're selling
« Reply #6 on: February 15, 2015, 04:39:42 PM »
You also have the option of being completely candid with them. If they are a retired couple, they likely (or not) have children of their own.

You say you intend to sell the house to use the proceeds (or part) to facilitate fertility treatments. The primary reason for your selling the house.

Combined with the advice already mentioned, I highly doubt that you are going to face any real drama. The future buyers will ask "Why are they selling?" The tenants will say, "They need money to afford fertility treatments, and that's the only reason." And the future buyers will instantly understand!

c-kat

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Re: telling tenants we're selling
« Reply #7 on: February 15, 2015, 05:04:51 PM »
Thanks. This is all really good advice!  They do have grown kids and I think would understand.

One thing I'm worried about is the showings. We can ask them to leave during showings but they are allowed to stay under the act. They aren't however supposed to answer questions about the property. The prospective buyers will be shown through with their agents and should ask us questions through our agent.

Our tenants are very chatty, and while trying to be nice, could cause problems.

Goldielocks

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Re: telling tenants we're selling
« Reply #8 on: February 15, 2015, 05:07:41 PM »
Be extra considerate of your tenants.  I would offer them the option of 2 months notice and the required moving costs, and to NOT show the house until they move out.

They can refuse this offer, but may not.

We had our landlord start to try to sell our rental, and it was a house with us and two kids under10 years.

Showings were a nightmare, with Realtors trying to come in without an appt, showing up 1.5 hr's late (after 8pm) on a school night, after we had vacated the place over dinner for that time so they could show it, then insisted on showing it with me giving one kid a bath... ( I hated being there during showings).

We had at least 15 showings a month, and it lasted for 3 months.

I am fairly private , FT working mom that did not have time to keep the place clean all week, and it really bothered me to have strangers walking through my bedroom, and seeing my laundry,unswept kitchen floors, etc.

If you have ever sold a home, you know what I mean, and renters have NO upside to the hassle of showings.

We had to finally insist on no key lockbox, to keep unscheduled showings away, but could not deny anything with 24 hr notice.

I am surprised that you can't just give the 2 mos notice for personal use when you want to sell.  BC does, and we have rent controls here.

c-kat

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Re: telling tenants we're selling
« Reply #9 on: February 15, 2015, 06:01:10 PM »
Be extra considerate of your tenants.  I would offer them the option of 2 months notice and the required moving costs, and to NOT show the house until they move out.

They can refuse this offer, but may not.

We had our landlord start to try to sell our rental, and it was a house with us and two kids under10 years.

Showings were a nightmare, with Realtors trying to come in without an appt, showing up 1.5 hr's late (after 8pm) on a school night, after we had vacated the place over dinner for that time so they could show it, then insisted on showing it with me giving one kid a bath... ( I hated being there during showings).

We had at least 15 showings a month, and it lasted for 3 months.

I am fairly private , FT working mom that did not have time to keep the place clean all week, and it really bothered me to have strangers walking through my bedroom, and seeing my laundry,unswept kitchen floors, etc.

If you have ever sold a home, you know what I mean, and renters have NO upside to the hassle of showings.

We had to finally insist on no key lockbox, to keep unscheduled showings away, but could not deny anything with 24 hr notice.

I am surprised that you can't just give the 2 mos notice for personal use when you want to sell.  BC does, and we have rent controls here.

Yes, I wish they'd allow landlords to give 2 months notice when selling, but ontario doesn't allow that which makes things difficult for both parties. My understanding is that it was to prevent people from kicking problem tenants out on the pretense of selling only to rent to new tenants. We'd love to give them time to leave first but the market here is still a buyers market and if we wait the 2 months until May it may be too late for us to sell. Many properties are taking 4 months or more to sell and once June hits things really slow down.

Our other option is to borrow for the fertility treatments, and sell next spring with more notice. However, many people think the Canadian housing market will crash, which could leave us without the money to pay it off. I feel that is too big of a risk.

I have a realtor who is fantastic and I know that she will make sure that people always give 24 hours notice, no exceptions.

Goldielocks

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Re: telling tenants we're selling
« Reply #10 on: February 15, 2015, 08:48:06 PM »
Be extra considerate of your tenants.  I would offer them the option of 2 months notice and the required moving costs, and to NOT show the house until they move out.

They can refuse this offer, but may not.

We had our landlord start to try to sell our rental, and it was a house with us and two kids under10 years.

Showings were a nightmare, with Realtors trying to come in without an appt, showing up 1.5 hr's late (after 8pm) on a school night, after we had vacated the place over dinner for that time so they could show it, then insisted on showing it with me giving one kid a bath... ( I hated being there during showings).

We had at least 15 showings a month, and it lasted for 3 months.

I am fairly private , FT working mom that did not have time to keep the place clean all week, and it really bothered me to have strangers walking through my bedroom, and seeing my laundry,unswept kitchen floors, etc.

If you have ever sold a home, you know what I mean, and renters have NO upside to the hassle of showings.

We had to finally insist on no key lockbox, to keep unscheduled showings away, but could not deny anything with 24 hr notice.

I am surprised that you can't just give the 2 mos notice for personal use when you want to sell.  BC does, and we have rent controls here.

Yes, I wish they'd allow landlords to give 2 months notice when selling, but ontario doesn't allow that which makes things difficult for both parties. My understanding is that it was to prevent people from kicking problem tenants out on the pretense of selling only to rent to new tenants. We'd love to give them time to leave first but the market here is still a buyers market and if we wait the 2 months until May it may be too late for us to sell. Many properties are taking 4 months or more to sell and once June hits things really slow down.

Our other option is to borrow for the fertility treatments, and sell next spring with more notice. However, many people think the Canadian housing market will crash, which could leave us without the money to pay it off. I feel that is too big of a risk.

I have a realtor who is fantastic and I know that she will make sure that people always give 24 hours notice, no exceptions.

Just so you know, your Realtor has nearly zero control over showings, especially if they don't control the key but uses a lock box.  She can only give the quick and standard reminder that 24 hr notice is mandatory, and trust that the buyer Realtors are professional.

I truly think you should have considered this earlier, given your urgency.  Ideally, you would show this without tennasnts sitting around tge table in their underwear, or other nasty behaviours...You have a few options still:

Offer a large money incentive to your Tennant's to move early
Put the place on a low "sell quickly" price
Indicate that an initial offer is required before showing.. Neighbors did this and it sold after only three serious showings.

 Tenants get frustrated after 6 or 7 showings... You want to avoid that if you want to have the best image.

c-kat

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Re: telling tenants we're selling
« Reply #11 on: February 16, 2015, 06:20:55 PM »

Just so you know, your Realtor has nearly zero control over showings, especially if they don't control the key but uses a lock box.  She can only give the quick and standard reminder that 24 hr notice is mandatory, and trust that the buyer Realtors are professional.

I truly think you should have considered this earlier, given your urgency.  Ideally, you would show this without tennasnts sitting around tge table in their underwear, or other nasty behaviours...You have a few options still:

Offer a large money incentive to your Tennant's to move early
Put the place on a low "sell quickly" price
Indicate that an initial offer is required before showing.. Neighbors did this and it sold after only three serious showings.

 Tenants get frustrated after 6 or 7 showings... You want to avoid that if you want to have the best image.

Actually, we have sold houses we've lived in before, and we received a call twenty four hours before all showings from our realtor's office - we had to make arrangements for our dogs which is why we asked for the 24 hours.  They were not allowed to enter without us saying yes when we got the call 24 hours before and we never had a problem. No one ever ignored the rule., showed up early etc. It is very standard here.

MikeBear

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Re: telling tenants we're selling
« Reply #12 on: February 16, 2015, 06:59:44 PM »
Why not offer a bribe to your tenants to keep the place extra-clean, and vacate for an hour or so during showings? Maybe they could go out to a restaurant that you pay for, or a movie or after the sale you give them a bit of money, etc?

Something along those lines.

Hey, maybe their kids would buy the place to keep their parents right where they are...

James

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Re: telling tenants we're selling
« Reply #13 on: February 16, 2015, 07:05:26 PM »
Why not offer a bribe to your tenants to keep the place extra-clean, and vacate for an hour or so during showings? Maybe they could go out to a restaurant that you pay for, or a movie or after the sale you give them a bit of money, etc?

Something along those lines.

Hey, maybe their kids would buy the place to keep their parents right where they are...

This is what I was thinking, making it "worth their time" would be a nice gesture, if you can afford it and it makes sense to you.

You could give them a gift certificate to a local place and replace it after every showing.

Goldielocks

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Re: telling tenants we're selling
« Reply #14 on: February 16, 2015, 07:43:22 PM »
I looked up the Ontario rules, I know in BC some Tennant's get aggressive, so just follow the rule to the letter, and they will have trouble going to the RTA for an order to stop showing more than a couple of times per month. I must say that I understand why after living through it.

Namely, you must give them written notice in person, or on the door, a minimum of 24 hrs in advance and enter between 8 and 8 only...  They can agree to let you in with verbal notice only but it is their choice.  Just have your Realtor drop by with the notice in advance. ( She will love that, I am sure)

Good luck! I hope it sells quickly,  within 6-7 showings, as your tenant's patience will wear thin about then.

Think what others have said about incentives, too.  They have ZERO reason to make this  easy, other than the fact that they are nice people.


clarkfan1979

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Re: telling tenants we're selling
« Reply #15 on: February 17, 2015, 06:34:39 PM »
All very good advice. Give them the offer to buy, give them a discount on rent for the showings and also give them a small incentive for it to sell ($500?). When it sells, give them their full deposit back asap so they can find a new place.

I don't agree that it has to be a negative experience. I have been the tenant before and I was never aggressive because of showings and having to move. 

MayDay

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Re: telling tenants we're selling
« Reply #16 on: February 18, 2015, 07:05:13 AM »
I've seen recommendations to hire a house cleaner, or offer a restaurant gift card for each showing (or every five showings, or whatever).

I know when we house hunted, if tenants were home we asked them tons of questions, and got lots of good info. If you don't want that going on, bribe the snot out of your tenants.

MissPeach

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Re: telling tenants we're selling
« Reply #17 on: February 25, 2015, 02:36:58 PM »
I'm not in CA but I also had my agent enforce 24 hour notice and put in the agents info I have a dog. That didn't stop agents from showing up and letting themselves in when I sold my last house. I probably had more that 10 agents just show up and let themselves in.

jmusic

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Re: telling tenants we're selling
« Reply #18 on: February 25, 2015, 02:40:24 PM »
I'm not in CA but I also had my agent enforce 24 hour notice and put in the agents info I have a dog. That didn't stop agents from showing up and letting themselves in when I sold my last house. I probably had more that 10 agents just show up and let themselves in.

Maybe you should've said "Pit Bull" instead of "dog!"

Edit to add:  Pit bulls can be very loving animals, despite common perception...

Blindsquirrel

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Re: telling tenants we're selling
« Reply #19 on: February 25, 2015, 06:56:45 PM »
Giving them the first option to buy is a graceful way to broach the fact that you need to sell & want their cooperation to show it. No one wants to be told they have to leave, even with 60 days notice, & you will have a tough time selling without their cooperation. Not sure how the law runs in CA but after you offer to sell it to them, send them a notice that you are not renewing their rental contract and that when it is up they need to move. I have given folks 2 free months rent in the past on houses that they did not want to buy but I wanted to sell in the USA and they have been very happy with that. They keep the place clean and show it for me and I do not charge them a dime. My tenants have not been super happy when I sell the house but they are happy with the free rent. In other cases (only 2x), I have bought the tenants another house to rent that they picked out. They were very happy in those cases and I had stellar tenants that I alredy knew were reliable.