Selling my rental before the lease is up

[Cody Smith]

Hey BP, thanks for stopping by my post!

I have a bit of a moral dilemma. I have a current LTR that I have gained about $80,000 in equity since purchasing. I began exploring STR properties recently, and after much research, I am interested in purchasing a vacation rental, a condo on the Emerald Coast. I have decided that I am interested in selling my current rental ($700/mo dirty cash flow) and using the proceeds to purchase one of these STR at the beach. The proceeds would cover my down payment and other costs associated. The property should appreciate over time due to location and demand, and should bring much more monthly income than the LTR, something very important to me as I prepare to transition out of the Army in two years.

My dilemma: I placed a new tenant with a 12 month lease on my LTR on May 1st.

I would like to give them first opportunity to purchase the property if they would like, but I’m not confident they will since this is an interim home for them until they build a home in a couple years. If they don’t want to, I would be selling and forcing them out 2-3 months into their new home and new lease. My lease does state the landlord can break the lease with 30 days notice to the tenant.

I feel bad for having to possibly put them out after just settling in, but if I am going to make this move on a STR, I do not want to wait until their lease is up for fear of interest rates and prices rising even further.

What would you do?