Below are questions asked by rental property owners regarding California property management, followed by answers provided by the law firm of Simone and Blevins.
Question 1: A real estate agent reached out to me, and I think I want to sell the condominium that I rent out, but I currently have a tenant living there. They are in the middle of a one-year lease that does not terminate until April 2026. Can I break the lease because I am selling the property?
Answer 1: No, you cannot break the lease at the time of the sale unless your lease specifically states otherwise. You may want to speak to the tenant and ask if they would be willing to break the lease or offer to buy them out of the lease. You may sell the property with the tenancy in place, try to negotiate an earlier termination date, or try to buy the tenant out of the lease. Selling a property that is tenant-occupied may limit the number of buyers willing to purchase the property. If the tenant will not agree to move before the expiration of the lease term, then your buyer will have to honor the lease.
Q2: The tenant that is renting my property is currently on a month-to-month rental agreement and I have decided to sell the rental property. Can I terminate their tenancy?
A2: It depends. If the property is exempt from rent control and you have provided proper notice of exemption, then you can terminate with a 30- or 60-day notice depending on the term of the tenancy (30-day notice for tenancies less than one year and 60-day notice for tenancies greater than one year). However, if your property is subject to state or local rent control, then you cannot terminate without just cause. Under most rent control laws, withdrawal from the rental market to sell your property is not considered a cause to terminate the tenancy. You would have to permanently remove the unit from the market. You should consult an attorney who specializes in Landlord/Tenant law prior to issuing a termination notice.
Q3: I am selling my rental property that is tenant-occupied. Can I show the property to prospective buyers?
A3: Yes, but it is sometimes difficult to schedule showings around a tenant. You must give the tenant at least 24 hours’ notice of your intent to show the property to prospective buyers. If, within the past 120 days, you or your agent has notified the resident in writing that the property is for sale, then you may give the 24 hour notice of your intent to show orally, in person, or by telephone. However, you cannot force the tenant to allow you access to show the property. If the tenant will not give you reasonable access to show the property, then you will need to contact an attorney’s office for further direction. Additionally, landlords have the right to hold an open house while the property is tenant-occupied. The landlord should speak to the tenant to find an agreeable date and time for an open house. When dealing with situations such as these, try to work with the tenant’s schedule and, hopefully, they will be reasonable in providing access to help you get the property sold.
Q4: I purchased an apartment building that is at full occupancy. What do I need to do to let the tenants know that I am the new owner of the building?
A4: You are required to serve your tenants with a notice of change of ownership/management every time ownership or management changes. This notice must include the name, telephone number, and street address for personal service of each of the following: 1) authorized manager, 2) agent for service of process of the owner, and 3) the person or entity to make rent checks payable to. The notice must also include the forms in which payments are made, such as by check, money order, cashier’s check, and/or cash (you cannot require only cash or certified funds). If rent payments are made personally, then the notice must also include the business hours when a tenant may make a payment. Alternatively, the lease or rental agreement may provide information to the tenant to make electronic payment or payment to a bank as long as the bank is located within five miles of the rental unit. All of the information regarding the change of ownership/management must be provided to the tenant(s) within 15 days of the property transfer. If the change of ownership notice is not served and the tenant does not make rent payments, you cannot demand rent using a three day notice for the time period that you are out of compliance.
Q5: I just purchased a new rental property, and I do not like the terms of the lease for the tenants currently occupying the unit. Can I change the terms of a fixed-term lease before it expires?
A5: No, when you purchase a rental property, and the tenant has a lease that has not expired, you cannot unilaterally change the terms until the lease expires. You can offer to negotiate a new lease or rental agreement with the tenants once you become the owner of the property, but you cannot force the tenant to sign a new contract. Once the lease expires you may serve the tenant a 30 Day Notice of Change in Terms of Tenancy to supplement or change the terms of the pre-existing lease/rental agreement. Once the 30 Day Notice of Change in Terms of Tenancy expires, the terms in the notice are enforceable lease/rental agreement terms regardless of whether the tenant signs the notice incorporating the new terms.
The law firm of Simone & Blevins has been doing evictions for over 28 years. Their office is open Monday – Friday from 9:00 AM to 5:00 PM. Tel: 619-235-6180, website: www.landlordslegalcenter.com, or email [email protected].