Should I buy a house with a tenant who's angry that I'll need to evict?

Check the law and the tenant's rental agreement to find out what rights the tenant has and how you can negotiate for a move-out.

Question

I’m about to buy a two-story townhouse, and plan to move into the home with my family. The current owner has a tenant living on the second floor. The renter has lived there for several years, and was unaware that the current owner was considering selling. He’s made his anger quite clear to both the current owner and to me, last time I was touring the building. What should I do?

Answer

Even under the best of circumstances, buying a home can be stressful. There are always a million variables, concerns, and uncertainties. You shouldn't necessarily cancel your purchase based on the presence of a tenant. But that said, the last thing you need is an angry tenant living there when you move in. A tenant like this could take any number of steps to delay your successful move.

First of all, assuming he has a written rental agreement with the current owner, that agreement likely has a provision about sale of the home and/or required notice for eviction. Usually, a lease would give a tenant 30 or 60 days.

Even if there’s no such agreement, he could simply refuse to leave, forcing you to run to court and file an action for eviction. (Large cities have specialized courts for landlord-tenant issues, like New York, Chicago and Los Angeles, to name just a few). Depending on the jurisdiction, he may also have a statutory right to remain for a longer period of time, or might be entitled to remain if he can persuade a tenant-friendly judge that the eviction is unreasonable.

Most courts are hesitant to eject a tenant, particularly on short notice. A tenant could easily delay the court process for weeks or months, causing you aggravation and legal fees. Moreover, you also don’t know much about this man – would he do anything to damage the home on his way out, or destroy any of the property you’re busily moving in?

Rather than fighting in housing court over statutes and lease provisions, a better solution might be to try to work something out between you, the current owner, and the tenant. The basic question is, what do you need to do to make this person leave quietly?

Surely the surprise of being potentially evicted was frightening for him. Express your empathy, and try to figure out, what would a reasonable amount of time look like? If you are unwilling or unable to delay your own move-in, what could you do to make his transition easier? Perhaps, to save you all of the trouble, you would be willing to pay his moving expenses, or even his first month’s rent.

The current owner has some skin in the game here too. You might signal that you are hesitant to continue with the sale if the tenant presents issues. This gives the owner a strong incentive to help you come to an arrangement with the tenant. After all, the sale of a townhouse is at least a six or seven figure transaction. It is likely that you’d be able to come to an arrangement with the tenant for something closer to four figures. Don’t lose sight of the forest for the trees. In short, you shouldn't necessarily walk away from a purchase opportunity merely because of an angry tenant -- but you should do all that you can to negotiate and find common ground.

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