At some point in time every owner of a rental property will make the decision to sell, whether making changes to their investment real estate portfolio or permanently cashing out of the market altogether.
So then, when is the best time to sell the property? While the strength of the market is an important consideration, the answer to that question as it pertains to rental property is determined by the disposition of the current lease, specifically the lease term. Ideally, the best time to sell is when the tenant has vacated thus guaranteeing unfettered access for showings to potential buyers and to make improvements to boost demand and sales price. And you don’t have to worry about the tenant not moving out by the date of closing!
But what if your tenant is not planning on moving or on giving their 60 days notice to vacate any time soon or even in the foreseeable future? Under certain circumstances the property can still be sold but this is where things can get tricky and Sellers are advised to educate themselves. In Ontario, Landlords and Tenants are governed by the Residential Tenancies Act and there are provisions in the Act defining the rights of Landlords and Tenants when a rental property is being sold.
Did you know?
- You can’t give notice to your tenant to vacate because you want to sell the property
- Unless given legal notice to vacate your tenant can stay – indefinitely
- An Agreement of Purchase and Sale does not break a fixed term lease
The fact that you wish to sell the property often means an untimely relocation for the tenant or at the very least continual interruptions for showings. The management of the sale process in respect of the tenant can be a tricky one and if not done properly or effectively the sale of the property can quickly get derailed.
Leverage the experience of a professional.
It is a good idea to have a real estate professional involved that has experience in the sale of tenanted properties.
I’m here to help and this is what we can do for you:
20+ years experience selling tenanted rental properties