Looking to sell a multifamily with tenants? You are probably wondering “is selling a multifamily with tenants in leases possible? We give you the answer, your options and what to watch out for. Read on to learn more.
Short Answer: is selling a multifamily with tenants in leases possible?
The short answer is yes, but it comes with a big “it depends.” Read below for more details.
Long Answer: selling a multifamily with tenants in leases
In the words of the motivational speaker Les Brown, “it’s possible.” We agree with Les. Everything is possible to a certain degree.
But, the possibility of selling a multifamily with tenants in leases depends largely on two things. These are the sales strategy you use and the specific buyer’s requirements. We discuss both of these in more detail below.
First, it depends on the sales strategy you are using to sell your multifamily
If you are selling to a cash buying company many of them will buy the property with tenants and all. We, for example do this. You will have to check and see if each cash buying company does or not.
If you are selling to a market buyer, either through listing with an agent or selling yourself, they will most likely want and expect the property to be delivered vacant.
Second, it depends on the specific buyer for your multifamily
Similar to above, many buyers will want your multifamily delivered vacant upon closing. In other words, they will require the tenants vacate before you close and transfer ownership.
If the buyer for your multifamily requires that the property is delivered vacant then it will be a bit tricky. You might have to wait until your tenants’ leases are finished.
If you want to be more proactive (say you want or need to sell quickly) you could try to pay the tenants to agree to leave (do cash for keys). This may or may not work, but it could be worth a try.
Again, if your buyer is a cash buying company many of them will buy your multifamily with tenants in place. However, you need to make sure when you receive the offer as not all cash buyers will do this. Some will still require that your multifamily be delivered vacant.