Can I sell a rental with tenants still living in it?
Yes. In Ohio a sale does not end a lease. The buyer takes the house subject to the tenant's rights, and the tenant pays rent to the new owner. A cash buyer who expects tenants can close without anyone moving out.
A buyer who wants to live in the house needs it empty, which means waiting for the lease to end or going to court. A buyer like me does not. I take over the tenancy as it is, and from closing day the tenant is my responsibility, not yours.
What happens to the lease when the house is sold?
The lease stays in force and transfers to the new owner. A month-to-month tenant stays month to month; a tenant with a year lease keeps it. At closing you hand over the leases, the security deposits and anything you know about the tenants, and you send the tenant a letter saying where to pay rent.
Security deposits move with the house. Ohio requires a landlord to return a deposit, less itemized deductions, within 30 days after the tenancy ends and the tenant moves out (ORC 5321.16), so whoever owns the house when the tenant leaves needs the money. The title company credits it to the buyer at closing.
How does eviction work in Ohio?
The landlord serves a written notice to leave at least three days before filing, using the wording the law requires, then files a forcible entry and detainer case in municipal court. If the court rules for the landlord, the tenant is given a date to move, and a court officer can remove them after that.
The notice rule is ORC 1923.04. It has to say, in these words, that the tenant is being asked to leave and that an eviction action may be filed. Get it wrong and the case can be dismissed and you start again.
An eviction costs filing fees, time off work for hearings, and often months of lost rent. Many landlords find out at the end that the unit needs thousands in repairs too. Selling with the tenant in place skips all of it.
What about tenants who don't pay or squatters?
I still buy the house. Tell me what is going on: how much rent is owed, whether there is a lease, whether the person living there ever had permission. Unpaid rent owed to you is yours to pursue or to let go; the house and the problem become mine.
Someone living in the house without ever having had permission is a different legal situation from a tenant who stopped paying, and it is handled differently in court. Either way, you do not have to solve it before you sell.
Do I need to give tenants notice that I'm selling?
Ohio does not require a landlord to ask permission to sell, but your lease may require notice before you enter the unit for showings. With me there is one walkthrough. Give the tenant the notice your lease requires, usually 24 hours, and I will work around them.
Ohio's landlord-tenant law expects reasonable notice before a landlord enters, and 24 hours is the usual rule. Check your lease. A single short visit is much easier on a tenant than weeks of showings, and an easier tenant makes for an easier closing.
What does Greg need to make an offer on a rental?
The address, the rent each unit pays, the lease terms or a note that it is month to month, the deposits you are holding, and what you know about the condition of the units. If I can see inside, great; if the tenant will not allow it, I can still make an offer.
If you are tired of being a landlord in general, not only of one tenant, read selling your Cincinnati rental property, which covers selling several rentals at once.
This page is general information, not legal advice. For your situation, talk to an Ohio attorney.
Greg Carpenter is a licensed real estate agent in Ohio. When Deforest Solutions makes you an offer, Greg is buying the house for himself, not as your agent.