On the market…
July 9th, 2009
We’ve seen a few properties we manage put on the market this year. This almost always, to put it mildly, freaks out the tenants.
The Residential Tenancies Act (also known as “God”, “the Bible” and ”That Damned Inconvenient Piece of Legislation”) requires that tenants be informed when a property is put on the market. So, we need to be told by the owner so that we can then pass it on to the tenant. It keeps things a lot mellower if the proper process is followed and tenants feel “in the loop”… being surprised by a real estate agent putting up a sign is probably the worst way to find out.
Fixed term is easy. They can’t move, they can’t be kicked out, their rent can’t be changed, and while the new owner may (heaven forbid 
) use a different management company, their experience as a tenant is likely to be pretty stable. Unless the new management company are scum of the earth… but of course, I couldn’t possibly comment.
) use a different management company, their experience as a tenant is likely to be pretty stable. Unless the new management company are scum of the earth… but of course, I couldn’t possibly comment.The only fiddly thing with fixed term is that you can’t sell the property with vacant possession unless we speak very nicely to the tenants and they are willing to end their lease. They are entirely within their rights to say no. Consider bribery :).
Periodic is rather trickier; if the tenant is in a periodic lease, they may opt to give notice and find another place to live on their own terms, rather than live with the possibility that they’ll be asked to leave at a time that may not work out well for them, have the rent put up, or just have things change at all. We have seen this occur several times, and then the owner is left with a place that’s rather difficult to rent.
Save a house that’s actually on fire, very little is more off-putting to a potential tenant than the idea of moving into a place that’s on the market. Someone recently turned down a house they adored for the sole reason that it was for sale. They were looking for a family home, and wanted to settle - the chance of being uprooted by a sale with vacant possession basically gave them the willies.
So! If you’re thinking about selling an investment property and you have tenants in a periodic lease, think hard, and consider finding out what your tenants will do before going ahead.
Rachel Borthwick
Lambton Property Management
