When the house you're renting goes up for sale

First things first – don’t panic!

Just because the owner is putting the property on the market, it doesn’t mean you’ll be forced to find a new place to live in. The reality is that many owners buy rental properties as an investment and, like any investor, if there is an opportune moment to sell, they will want to take it.

In this situation, it’s critical to understand both the owner’s rights as a landlord and your rights as a tenant, and then plan accordingly.

The owner’s rights

As an owner, your landlord is within their rights to sell the property even if it falls during your fixed lease agreement. However, before they show the premises, they must provide you, the tenant, with written notice of their intention to sell. Landlords also must provide ample notice to tenants in writing before showing a property, which can be anywhere between 24 and 48 hours depending on which state you are in.

If proper notice is given, landlords can enter the property for a showing regardless of whether you have agreed, and without a tenant present.

Your rights as a tenant

Selling a property in the middle of a fixed-term contract is relatively common, and thankfully there are laws in place that protect tenants from the possible pitfalls that could occur.

During the selling process, you are obliged to keep the property in a reasonable condition but don’t need to go to any special effort to make the home saleable. In other words, if your landlord asks you to buy fresh flowers every day, you don’t have to do it!

In addition, while your landlord is allowed to show the property with ample notice to you, they have to keep weekly showings to a reasonable amount. This means a landlord cannot arrange showings every day of the week — unless, of course, you consent to it.

Once the property is sold, the new owner has essentially purchased with knowledge of your tenancy and your original lease agreement still stands. You won’t be forced to move out of your new home simply because the property has a new owner. If the new owner does indeed want to end the lease, they must abide by the existing terms and conditions that are in your contract, which include giving you 30 or 60 days notice to vacate.

Where to from here?

If your landlord has notified you that the property is going up for sale, the best thing to do is to arrange a time to sit down, discuss the situation, and try to come to a mutual agreement.

When it comes to your rights, bear in mind that each state has slightly different laws. Make sure to familiarise yourself with your state’s specific tenancy laws so you know exactly how much written notice you need to be given before, during, and after the sale. And, as with anything, make sure to get all communication in writing just in case there are any misunderstandings down the track.

For a list of essential rental resources and tenancy services in each state, click here to read our blog post.