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We decided to rent out one of our houses a few years ago. Now that the market is doing well and home values are up, we want to sell. The renter that currently lives there doesn’t want to purchase the home, but also doesn’t seem very keen about moving out. We’re worried that he will make the selling process more difficult than need be. What’s your advice for selling homes with tenants?


Rob, Orchard Mesa


Great question! Selling with a renter in place can be very tricky and can provide a significant obstacle if you don’t work to meet them in the middle. You will need their cooperation if you are going to be successful at selling and get anywhere close to market value. First, you must refer to your lease contract and use that as a guide on how to deal with your tenant during the process of selling. There should be language in the contract for how the process will work with your tenant, as far as showing and selling. If you still have months left on the lease, then obviously you will have to honor the remaining time and the new owner will inherit them as a tenant until the end of their lease. If they are under a month to month lease then things get easier as long as you provide ample notice (typically 30 days) of when they need to be out if the new owner does not want to keep him/her as tenants. Regardless of the contract language or length left on their lease, tenants typically (and understandably) are not thrilled about having the house they are renting sold!

Let’s face it, put yourself in their shoes…from a renters perspective, how is showing a home for the landlord and potentially having to move out ever something they are going to get too excited about? Cooperation is NOT in their best interest and let’s be honest again…the entire showing process (allowing stranger after stranger to march through your home) is the most stressful and inconvenient part of selling any home and your tenant is the one that will have to deal with showing process. It’s hard to take even when you are motivated to sell! With that in mind, there are many tactics you can use to help ensure that your renter is cooperative with the sales process. One way we encourage tenant cooperation is by showing them respect. Really respecting a tenant and treating them as if they were the homeowner goes a long way to gaining their trust and cooperation. Do your best to work around their schedule and family time, as long as their expectations are realistic and still allow ample days and times for showings. Being grateful is also a great way to gain their cooperation. Acknowledge that the process can be a painful one and that you are appreciative of their cooperation. Empathy is a powerful tool, especially when teamed up with respect. If respect, gratitude and empathy don’t get what you are after, you can always offer them incentives to cooperate. Just like kids, tenants love incentives.

If their rent is $1500 per month, offer to lower their rent by $300-400 a month until the home closes and watch their cooperation level increase significantly. $300-$400 a month is real money and a significant amount. It’s like a free car payment! You must tie this incentive to keeping the house clean and show ready and allowing showings to occur without resistance or the deal’s off. Let them know you are going to check with the listing agent each month to evaluate their cooperation so you establish some accountability, but this tactic generally works well. You can also offer moving incentives, a one month buy out of their rental contract etc. Trust me, if you offer the tenant a month’s rent in payment upon move out, that’s pretty good incentive! Don’t be afraid to get creative with your incentives to encourage their cooperation. You can offer to hire a house cleaner, yard maintenance crew, daycare 3 days a week…whatever it takes to get the cooperation needed to sell. 

The bottom line, set up a win/win and you will generally get a better outcome. If it turns out to be only you who gains, expect resistance. A win/win is always the best way to get your desired result! 

Dave Kimbrough
The Kimbrough Team


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