There is no doubt in the fact that every landlord has the right to sell his house at any point of time but still there are some obligations that have to be met. Landlords have many reasons for wanting to sell a house they are renting to a tenant. These reasons may include a need for cash, a desire to retire from the management of real estate, or other financial reason. While some tenants are concerned or complain about a proposed or actual sale of the property, the rights of the property owner are clear. However, a new owner of a rental property is required by law to honor the existing rental agreement between the previous owner and the tenant.
Rights of the Owner:
Every landlord enjoys the right to sell his property even if the decision is taken during the term of an existing lease. The landlord is not authorized to immediately throw the tenant out of the house. Every landlord is obligated to send a prior notice to the tenant before selling the property. The tenant should be made aware of the situation and will probably be asked to show the property to the potential buyer. The landlord must make a good faith effort to contact the tenant and arrange a time and date for showing the property to a potential buyer. And the tenant is obligated to make a good faith effort to meet with the landlord for a showing. An unannounced landlord appearance can not only be uncomfortable for the tenant but could also violate the rental agreement. State laws differ on landlord and tenant rights so all parties should be aware of the rights of all parties.
Rights of the Tenant:
Since it is true that every landlord holds the right to sell a house while it is still being rented, it doesnt mean that tenant has to be worried. Selling a house doesnt mean that tenant has to leave immediately. If the leave agreement is still in effect then the tenant has a right to remain there even if the house comes into the possession of a new owner.
It is also worth mentioning here that most of the time this whole process can be smoothened with the help of mutual agreement between the landlord and the tenant. If a tenant agrees to vacant the house by accepting a sum of money then it is beneficial to both parties. However, the new owner may also be a landlord and want the tenant to remain in the house. The new owner may actually want to make improvements in the house in order to raise the rent in the future.
The Home Buyer
Since the house is being rented to a tenant it is defined as an investment property, not an owner occupied property. That being the case, the financing options are more limited for investment properties. So the current owner is thinking how to sell a rental house with the best chance of success. The house buyer may have to pay cash to purchase the property if other options are not available. If the new buyer wants to finance the purchase then some of his best sources would be private real estate investors.
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