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Sellers’ Series: Selling a Property with a Rental Suite, Part Two

Alyssa Dotson
March 11, 2015

Welcome back to the second part of this two-part feature on selling a property with a rental suite.

Last week’s article was focused on determining the type of suite that your home contains and the effect it has on buyers qualifying to purchase it. This week, we will be outlining the rights and responsibilities of both seller and tenant when selling and showing a property that contains a rental suite.

As outlined in the BC Residential Tenancy Act, the seller/landlord must inform the tenant that the property is for sale and give the tenant 24-hour written notice to show the property, which must include the date, time and reason for entry. Notice is given a minimum 24 hours in advance, not to exceed 30 days; generally with showing requests between the hours of 8am-9pm.

When dealing with a tenant that is hard to reach, the seller must schedule viewing times in advance. Once proper written notice has been given, the landlord has the right to show the unit, even if the tenant is not home. When giving advance notice, make sure the notice does not infringe on the tenant’s right to privacy.

Here’s an example of infringement: “Dear tenant, I wish to show this suite next Tuesday, March 17, Wednesday, March 18 and Thursday, March 19 each day between the hours of 1-5pm.Thank you, Landlord.” The excessive time span “between the hours of 1-5pm” takes away from the tenant’s right to privacy by attempting to place a 12-hour reservation over a three-day period. A more acceptable request would be one hour per day.

Uncooperative Tenant?

If a tenant unreasonably denies access to show the suite or supplies potential purchasers with inaccurate or misleading information, you have a few options to pursue.

  1. Approach the tenant and try to resolve the issue.
  2. Supply the tenant with information regarding the BC Residential Tenancy Act, outlining the landlord and tenant’s rights/responsibilities.
  3. Serve one-month written notice to end tenancy for cause.

Dealing with a difficult tenant can be challenging and frustrating, especially when trying to sell your home. In my experience, only one of my sellers found it necessary to exercise and enforce the third option. In most cases a resolution can be reached to the satisfaction of both parties, even after a series of less than favorable incidents.

Assumption of Tenancy

When the property sells and the tenancy is to continue, an additional agreement is not necessary as the purchaser assumes the tenancy with the original terms and conditions. If desired and agreed upon by both parties, a new agreement can be drafted to reflect a change of landlord information. This new agreement may be with or without amendments to the current terms and conditions of the original agreement.  

Sellers make sure the contract of purchase and sale does not state vacant possession as the assumption of an existing tenancy will contradict this.

If the tenancy (month to month) is not to continue with the new owners you, as the original seller, must give the two-month notice to end tenancy and compensate the tenant with an amount equal to one month’s rent. Please note: compensation is owed even if the tenant gives notice to leave earlier.

Fixed-term tenancies always survive the sale. Neither the seller nor the new owner can end a fixed-term tenancy early. The only way to end this type of tenancy early is if both parties agree and complete the Mutual Agreement to End Tenancy form.

Being a landlord carries a great deal of responsibility and it should be approached in a professional, business-like manner. Exercise courtesy and care while interacting with your tenants when transferring these responsibilities as a seller onto a purchaser, and be certain to abide by the guidelines and parameters set out by the BC Residential Tenancy Act.

Alyssa Dotson
Alyssa Dotson of Alyssa Dotson Real Estate Team is a top-sales-award-winning REALTOR® for Sutton Group, West Coast Realty. With 13 years of experience as a Realtor, Alyssa has proudly served many sellers and home buyers in the Greater Vancouver and Fraser Valley regions.