Cash for keys question

[Benjamin Richards]

I've got a nice SFR rental that I've been planning to sell at the end of June when the current lease is up. I was already concerned about this market and now with the COVID situation I'm afraid the market could really dry up between now and then.

I have a great relationship with my tenants and would like to ask them if they would consider ending the lease early. They already know that I want to sell the house at the end of this lease and they already told me they are willing to help in any way they can, including let the home be shown before they leave.

I would like to make them an offer about listing it now and then paying them some amount if it sells and they have to leave early.

What would be reasonable terms for such a situation? Not that it matters, but the rent is about $1600/month.

[Marc Winter]

There are a few ways to consider this situation:  First if the tenant will cooperate in showing, that's great!  If their lease is up in June and this for all intents and purposes is April, (and I'm thinking we might as well erase the month of April) a 60-day closing of escrow is not a terrible thing.

Second, you have no way of knowing whether the buyer will be an end-user, or another investor, like yourself. So for that aspect, an early move out is probably a moot point.

Lastly, what makes you so sure the market will tank after this CV19 is done?  I see three possibilities for that: the market will stay the same, go up, or decline.  Two out of three ain't bad.

I say keep your powder dry, stay alert, and don't make any hasty or rash decisions out of fear of an unknown future.

Good luck, stay safe and healthy.  We will get to the other side of this.