To Inherit Tenants, or to Not Inherit Tenants

[Jonathan Johnson]

I'm considering buying a 4-unit apartment. I plan on moving into one of them and renting the rest. It's currently fully rented and the landlord says they are good tenants. The seller can have them all move out on sale of the property and with all the risk and warnings I've read in the forums about inherited tenants, I am most likely considering just that.

However, that would be about $1500/mo I would miss out on until we get it back rented again. It's a decent but older house with some repairs on the outside and updating on the inside needed. We have some $5k or so to spend on repairs so we would definitely miss the monthly income.

Would you guys have it delivered vacant or just have one evicted? 

[Deanna McCormick]

You should have the unit you'd prefer to live in vacant at time of ownership, the other's I wouldn't be concerned about. When leases they have expire just keep them on month to month, then it gives you more flexibility in deciding which unit to rehab next. So foremost find out what current lease terms for all the tenants and study up on the landlord tenant laws for your state. 

You have to decide how soon you want to move in or start remodel on unit you want to occupy which would make that unit the one you focus on getting available.

The time and energy you spend on finding all new tenants with a empty building, and having to do cleaning, and turn fixing prior to renting will eat your pocket book so unless your prepared for those costs take the building occupied. I sold 2 buildings occupied and the buyer didn't want it empty. I always have my tenants on month to month and is a good way to manage the property. The only good thing about a year lease is the tenant is somewhat locked in. and owner is somewhat locked out if he want's to change things up.