Selling a Rented Home Can Pose Challenges

Some home owners turned into reluctant landlords and rented out their homes to earn extra income while the housing market was sluggish. But now some of these home owners are ready to sell.

However, real estate agents often caution clients that trying to sell a home when a tenant still lives there can be tricky since many renters — who have no financial stake in the matter — aren’t always so eager to help market a home and keep it tidy and neat on their landlord’s behalf.

Nevertheless, “it’s pretty common in this market to be selling a home with a tenant in it,” Chris Hager, a real estate professional with Long & Foster Real Estate in North Bethesda, Md., told the Washington Times. “There are lots of reluctant landlords out there who opted to rent their property rather than sell it, and now they want to put it on the market. There’s the potential for conflict between the tenant and the landlord, especially if it was not made clear to the tenant from the beginning that the owners wanted to sell.”

Landlords should make a point to clearly communicate their intentions to sell, and not “sneak” the house on the market without telling the tenants first, real estate professionals say.

Landlords might want to offer a concession on the rent to tenants in exchange for them keeping the home in clean, good condition while it’s on the market — such as 10 percent off each month’s rent while it’s on the market. But be sure to communicate expectations for cleanliness, such as keeping the dishes out of the sink and making the bed. Experts also suggest setting established hours for showing the property to make it easier on the tenant.

“You never get a second chance to make a first impression, so it is particularly important to have the place in strong showing shape on the first and second weekends on the market,” says Nick Pasquini, broker-owner of Century 21 Redwood Realty in Washington, D.C., and Arlington and Ashburn, Va.

Source: “Challenges of Selling a Rented Home,” Washington Times (Jan. 13, 2012)