Tenants' Rights During Home Sale

When a landlord decides to sell a property, it can leave a tenant in a precarious situation. This can be especially difficult for a tenant who has made that rental property their home over multiple years. When this does happen, it is important for tenants to know they do have rights when it comes to the occupancy of the property. So what should tenants know when a landlord chooses to sell their property?

Landlords must notify their tenants

During the sales process, communication is important. A landlord is required to notify their tenant about their intent to sell. This is crucial for allowing tenants to begin making long-term plans about where they might live if the unit is no longer available after the sale. 

Right to quiet enjoyment

As with the communication about the intent to sell, landlords must communicate with the tenants about any work or showings on the property during the sales process. The landlord will need to give the tenant 24 hours’ notice for anything that will require them to be on the property. 

What can landlords ask of tenants?

The sales process is going to lead to inconveniences for the tenant, and it is important for those landlords to communicate clearly those inconveniences. When it comes to showing the property, landlords can ask some things of their tenants: 

• Keep the home clean and orderly
• Leave the home during showings 
• Agree to a lockbox on the property

During this process, a tenant has the right to negotiate a reduced rent as compensation for the inconveniences. This is all negotiable and tenants can refuse any requests. Landlords should also schedule any showings during reasonable hours of the day and days of the week. 

Can a landlord break the lease?

Unless there is specific language in the lease about ending it during a potential sale, a tenant has the right to live in the property through the end of the lease. If there is language in the lease about the termination of the lease due to a sale, the landlord must give the tenant a 30-day notice to the tenant if they are required to move. If the tenant has lived in the property for over a year, the landlord is required to give a 60-day notice. This can change depending on local municipal rules.

After the sale of the property, all payments will go to the new owner, and the tenant and new owner can negotiate a new lease once the lease is over. 

Landlords have rights too

While the sale of a home can be stressful for a tenant, it is important to know landlords have rights just as tenants do. Tenants aren’t allowed to make the sale difficult or intentionally impede the sales process in any way. Tenants are also required to follow the terms of their lease and pay rent. 

Under the Ellis Act, a landlord can evict all tenants to change the use of the building or convert the rental property to tenancies-in-common. In order to do this, a landlord is required to take the building off the rental market entirely. 

If a landlord chooses this route, tenants will be notified in advance and landlords will be required to pay relocation fees.