Selling a property w/ tenants vs. waiting for vacancy to sell

Selling a property w/ tenants vs. waiting for vacancy to sell

Rochester, NY · Member since 2016 · 16 posts · 8 votes

Hey there! I would love to get some feedback from more experienced investors on this issue. My husband and I are preparing to sell a single-family home in Brooklyn (it was our primary residence until 2 years ago, at which point we rented it out to tenants.) Their lease expires on October 1st and we're not sure whether it makes more sense to try and list the house now while our tenants are occupying it, or wait until they move out to put it on the market. 

Reasons to wait: The tenants have a lot of furniture and they put dark curtains on all the windows, making the house feel dark and small. I know how to stage a house and take awesome photos to help it sell, and we just wouldn't be able to do that with the tenants there. Also, they are 3 roommates in their 20's who are working from home, and coordinating showings when they're all out of the house will probably be impossible.

Reasons to list it now with tenants still there: The carrying costs on this house are around 3k/month, so we wouldn't want it to sit empty for too long. Also, the tenants love the house and they volunteered to stay on month-to-month until closing, so we'd never have to carry the mortgage alone, even if it takes longer to sell than we'd hoped. Also, with all the craziness around COVID restrictions and new NYC regulations, I just feel like it's so hard to predict what will happen in the NYC real estate market even 2 months from now, and it's still a good time to sell in our area.

So, those are our pros and cons. What would you do in this scenario? Any input welcome!

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  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    5y

    If the place won't show well and there is a lease in place until the end of Sept, let them know you are not renewing their lease (they will need time to find a new place) as you are selling.  I would then wait for it to be vacant  as it will show better.

  • Rochester, NY · Member since 2016 · 16 posts · 8 votes
    5y

    Thanks for the reply! Yes, the tenants know we are planning to sell the house and the lease will be over at the end of Sept. They are being very gracious about it and even, as I mentioned, offering to stay month to month until the sale closes.

  • Real Estate Agent · South Lake Tahoe, CA · Member since 2016 · 680 posts · 644 votes
    5y

    @Nikki Taylor

    Absolutely sell vacant if you can pull it off. You listed all of the reasons yourself. On top of those reasons, buyers can also feel more comfortable that there won’t be any eviction issues that hold up closing.

    The easier it is to show and the better it shows, the quicker it will sell.

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