Some of my clients own homes that they rent out for a time with the intention of selling in the future. As landlords, they should be aware of problems that can arise when they put that house on the market and how they can best protect themselves.
We recently took on a listing from a client who wanted to sell a house that she was renting out to a tenant. When a listing is occupied by the seller’s tenant, complications can arise, particularly if the tenant believes he or she has an exclusive right to privacy in the residence. Unfortunately in this case, the tenant became very upset when he was told that the landlord wanted access to the home to show it to prospective buyers. He was uncooperative, refused entry to the broker, and even went so far as to change the locks to prevent anyone else from entering the premises.
There is a useful handbook published by the New York Attorney General called Tenants’ Rights Guide, which outlines the rights and responsibilities of tenants and landlords in New York. In general, tenants have the right to privacy within their living spaces. A landlord, however, may enter the property with reasonable prior notice, and at a reasonable time, (a) to provide necessary or agreed upon repairs or services; (b) in accordance with the lease; or (c) to show the property to prospective purchasers or tenants. In an emergency, such as a fire, the landlord may enter the premises without the tenant’s consent. A landlord may not abuse this limited right of entry or use it to harass a tenant.
The best way for a landlord to protect him/herself is to address this situation in a lease. It is advisable to have a clause in the lease that clearly states that the landlord has the right, upon reasonable notice to the tenant, to show the property and that it is the tenant’s obligation to cooperate with the landlord’s efforts to show the premises to prospective buyers. It is always a good idea to communicate this to a tenant up front at the beginning of the lease period. In the case of an oral rental agreement, again, the best course of action is to advise the tenant at the outset of the likelihood that the home will be put on the market.
Returning to my client’s story: She clearly had the right to enter her property to show it to a buyer after giving the tenant reasonable notice. How did she handle the situation? She advised her tenant that she would be showing the home a certain number of days during the week and, knowing that he worked during the week, she gained entrance and scheduled showings when no one was home. We worked together and, eventually, I am happy to report, an offer was received and this home is currently under contract.
If you would like to discuss buying real estate for investment, tenants’ or owners’ rights, don’t hesitate to call my office at (914) 234-4444 or e-mail firstname.lastname@example.org. We look forward to hearing from you.