Selling a house with tenants in Pennsylvania requires careful consideration of both state laws and the lease agreements in place. Pennsylvania has specific rules that govern how much notice you need to give tenants when selling a property, and these rules depend on whether the tenant is on a month-to-month lease or a fixed-term lease. Additionally, the rights of tenants and the obligations of landlords are clearly defined under state law, which means that sellers must be diligent in following proper procedures. This guide covers everything you need to know about the notice requirements and the process of selling a rental property with tenants in Pennsylvania.

1. Understanding Lease Types and Their Impact on Notice Period

The type of lease agreement your tenant has will significantly influence how much notice you need to give when selling a house. Let’s break down the two common types of leases: month-to-month and fixed-term leases.

Month-to-Month Leases:

Month-to-month leases offer more flexibility for both landlords and tenants. In Pennsylvania, if a tenant is renting on a month-to-month basis, the landlord can terminate the lease by giving the tenant at least 30 days’ notice. This is governed by Pennsylvania’s Landlord-Tenant Act.

However, it’s crucial to understand that the 30-day notice must coincide with the start of the next rental period. For example, if rent is due on the 1st of each month, and you issue a notice on the 15th of the current month, the tenant would have until the 30th of the following month to vacate, since the 30 days must begin at the start of the next rental period.

Even if you’re selling the property, this 30-day notice period is mandatory. You cannot force a tenant on a month-to-month lease to leave without giving them this legally required notice. It’s advisable to give written notice and document when and how it was delivered to avoid potential legal disputes.

Fixed-Term Leases:

Fixed-term leases, such as a one-year lease, are more rigid in terms of notice and termination. If the tenant has signed a fixed-term lease, you cannot force them to move out simply because you are selling the property. The new owner of the home will take over the existing lease, and the tenant is legally allowed to remain in the property until the lease’s expiration unless both parties agree otherwise.

This means that if you’re selling the property to a buyer who wants to live in the home, the buyer must honor the tenant’s lease unless they come to an agreement with the tenant, such as a buyout or other form of compensation for early termination.

2. Selling a Property with Tenants in Place

When selling a home with tenants still occupying the property, there are several important considerations and procedures that must be followed.

For Month-to-Month Leases:

If you or the buyer of your property wants the tenant to vacate before the sale, the process is relatively straightforward with a month-to-month lease. As discussed, you need to provide the tenant with a 30-day written notice of termination. The notice period must align with the rental cycle, which typically starts on the 1st of the month.

If the buyer is an investor or landlord, they may prefer to keep the tenants in place to continue receiving rental income. In this case, you would not need to give the tenants notice to vacate, as the new owner will assume the lease.

For Fixed-Term Leases:

With fixed-term leases, the sale of the property does not automatically terminate the lease. The buyer will “inherit” the tenants along with the lease. If the buyer is purchasing the property to rent it out, they will likely welcome the existing tenants, as it allows for continuity of rental income without having to find new tenants.

If the buyer plans to move into the property themselves, they must honor the fixed-term lease unless the tenant agrees to move out early. This could involve negotiating a lease buyout or offering incentives for the tenant to vacate sooner. This process must be handled delicately, as tenants have the legal right to stay until their lease ends unless they agree to an early termination.

3. Tenant Rights and Legal Considerations

Tenants in Pennsylvania are protected under the state’s Landlord-Tenant Act, which ensures that they cannot be unlawfully evicted, even when the property is sold. Here are key considerations for ensuring that the tenant’s rights are respected:

Notice of Sale: While Pennsylvania law doesn’t require you to inform tenants that the property is being sold, it’s good practice to notify them in writing. This builds trust and ensures they are not blindsided by the sale. Additionally, if tenants are required to vacate, you should clearly explain the timeline and the process to them.

Property Showings: Landlords must provide reasonable notice before entering the rental unit, including for showing the property to potential buyers. Pennsylvania law typically considers 24 hours to be reasonable notice, although this may vary based on the lease agreement. Ensuring proper communication with tenants about showings is crucial to maintaining a good relationship and avoiding disputes.

Transfer of Security Deposit: If the tenant remains in the property after the sale, the landlord is responsible for transferring the tenant’s security deposit to the new owner. The new owner must then provide the tenant with a written acknowledgment that they have received the deposit. Failure to do this can result in legal complications.

4. How to Handle Evictions When Selling a Property

If you’ve given tenants proper notice but they refuse to vacate the property, you may need to proceed with a formal eviction. Eviction in Pennsylvania is a legal process, and it is important to follow the correct procedures. Here’s what the process generally looks like:

Step 1: File for Eviction: If the tenant does not move out after being given the proper notice, you will need to file an eviction notice at your local district court. The court will schedule a hearing, where both the landlord and tenant will have the opportunity to present their cases.

Step 2: Court Hearing: At the hearing, the judge will determine whether the tenant must vacate. If the court rules in your favor, the tenant will be given a set amount of time to leave the property (usually 10 to 30 days).

Step 3: Enforcement of Eviction: If the tenant still refuses to leave after the court-ordered eviction, the landlord can request a “writ of possession,” allowing law enforcement to physically remove the tenant from the property.

5. Special Lease Clauses and Agreements

Some leases may include special clauses that pertain to the sale of the property. For example, a lease might stipulate that if the property is sold, the tenant must be given 60 days’ notice instead of the standard 30 days. Other clauses may allow for a lease termination if the new owner intends to occupy the property.

Reviewing the lease in detail and consulting with a real estate attorney is highly recommended to ensure compliance with both the lease agreement and Pennsylvania law.

Conclusion

In Pennsylvania, selling a house with tenants requires careful attention to the lease agreement and state regulations. For tenants on a month-to-month lease, a 30-day notice is generally required, while those with fixed-term leases are entitled to stay until the lease expires. Clear and respectful communication, following legal procedures, and honoring tenant rights will help ensure a smooth process. Whether you’re dealing with a flexible lease or a more complex situation, it’s essential to be informed and proactive in handling the sale.

For a fast and easy home sale, even with tenants, consider TM Prestige Home Cash Buyer. We purchase properties as-is, taking the stress out of selling your home. Contact TM Prestige Home Cash Buyer today for a quick, cash offer, and a seamless selling experience!