Recently, a client of ours ran into a problem trying to sell their property, which was tenant occupied. They were putting their house up for sale, and they wanted a quick closing so they could act on a new investment opportunity. This is no surprise in our busy Toronto market. They did run into a few hiccups, which we are sharing today in case you need to sell an occupied property.
Negotiating with Tenants
In Ontario, a property owner does not have the option to evict a tenant to sell a property. There is no room for it in the legislation that governs landlords and tenants, and there are no notices you can provide. You will need to negotiate with your tenant or the new buyer to end the tenancy. This is a common problem in the market. People get into a sales agreement guaranteeing vacant possession, but they have no way of enforcing it.
Property Management Toronto
In this scenario, the client ended up in default. They were not advised correctly by their Realtor, and they never made arrangements for the tenants to move out in time to meet their closing agreement. So, be aware of the law, and make sure you know the appropriate steps. You can negotiate with your tenants, you may serve an N12 notice that the buyer will move into the property, or an N11 notice, where the tenant agrees to move out.
You do not want to know about problems at the last minute. If you can plan ahead, the sale will be easier. A professional property manager has regular contact with your tenants and may be able to ease a situation like this. Be careful of the guarantees you give.