Good morning, Lori!

We have a dilemma and are hoping you can help.  My elderly father-in-law recently went into assisted living care due to ongoing health issues.  He owns a duplex and has been living on one side while renting out the other.  The current renters have been in place for less than a year and still have 5 months left on their lease.  We are now looking to place the property on the market in the next month or two since my father-in-law’s new living situation seems to be permanent and he needs the funds to help pay for his care.  He agrees and has given us the go ahead to prepare his house for market.  We’ve already started to make a few minor repairs and updates on the exterior and recently had a couple of windows and carpeting replaced in his unit, but the renter’s side is a different story.  We aren’t sure how to go about staging and selling the property while the tenants are still living there.  I have only seen through the front door a couple of times.  It looks very cluttered and I’m afraid it will be a turn-off to potential buyers.  The renters are aware we are planning to list it For-Sale-By-Owner, though we haven’t mentioned a time frame.  How can we show this property to potential buyers without causing any legal issues or bad feelings?

Complex-Duplex in Arkansas

Dear Complex-Duplex – Thank you for your question and yes I agree, selling a house with tenants in place can often prove a bit more challenging.  For my part, I can only give you an opinion, not legal advice.  I know tenant laws vary by state, though I do believe as long as the renter is in a lease, your father-in-law is still bound by that lease.  While the house could be placed on the market, the renters are under no obligation to tidy up for showings, and you would likely need to give them at least a 24-hour notice each time the house is to be shown.

That said and without knowing all the details, I would approach the renters to see what they might be open to.  Offering an early buy-out of their lease and perhaps offering to pay something towards their moving expenses might sweeten the pot and prompt them to leave early.  And while this option would definitely dip into the money you’re trying to save for your father-in-law’s care, it might be the best idea if you really want them out.

The one advantage you have is that it is a duplex, and the buyer might see a tenant already in place as a positive, not a negative.  As a single family home, that would likely limit the pool of potential buyers to investors and buyers with the patience to wait for the lease to expire.  As a two-for-one however, it could be exactly the right scenario a buyer might be looking for!  An investor would be more apt to see it as a ‘one-down, one-to-go’ offer, and a potential buyer planning to occupy the space might like the idea of having someone else making those monthly payments toward their mortgage.  In that case, staging and showing your father-in-law’s side of the duplex might be enough.

Whatever you decide to do, I would strongly encourage you to seek legal advice from an attorney who specializes in real estate sales in your area before moving forward, either way.  If it were me, that would be the first place I would start.

Wishing you and your father-in-law the best!  Hope it all turns out favorably.

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