Which route should I take?

[Eric Thompson]

I recently purchased a duplex that is fully occupied, that I now intend to move into in the near future. I am having a bit of a hard time figuring out which tenant to keep and which to get rid of.

My initial plan was to build a garage on the property with a third unit atop that I would move into when it was inhabitable. Zoning is proving to make this not a possibility, so now I am planning to move into one of the units and build a standalone garage.

The duplex is an upper/lower split, both units in need of some heavy renovation but making good enough money as they stand now that the purchase was a good deal. The upper unit is on a year lease that is up at the end of June, the lower unit is month to month and has been there for several years now.

Currently, I rent an apartment, and moving into one of the units will still be a net positive because I'm losing less rental income from the loss of that unit than what I pay for my place now.

I feel like the most gentle approach would be to approach the lower unit tenant about my intentions and ask if he is interested in moving out, and if he isn't then giving the upper unit plenty of advance notice that their lease would not be renewed come the end of June.

The more immediate approach would be to give the bottom tenant (longer term, month to month) 60 days notice that his lease was going to be up and move in there as soon as he is out.

Any advice or suggestions?