# Selling a house with a tenant in it



## Romy (Jan 14, 2015)

Hi there!

I'm about to move to a new city. Instead of selling my house (and paying hefty agent commissions), I thought of renting out my house to a tenant, then putting that income toward renting in my new location.

What happens in 2-3 years if I want to sell the house? Once the lease is expired and the tenant is renting month to month, am I allowed to give the tenant a 60 day notice and request he/she moves, so that I can sell the property?

I've heard that legally, the tenants have a right to stay in the property in this case, and that I can only insist they move either if they're problematic tenants (destructive or not paying rent) or if I or an immediate family member need to live in the property. Given that neither case applies here (when I want to sell the house), do I have the right to give the tenants a 60 day notice and request they leave?


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## Just a Guy (Mar 27, 2012)

First, make sure you file the paperwork properly with CRA so that your capital gains are properly calculated later.

Next, be sure that the place actually makes sense as a rental. A house is different from a rental, one is a personal possession, the other is a business move. Cash flow, return on investment, etc. All should play a role in your decision. 

How do you plan to manage the property from a distance? What happens if you get a tenant from hell who breaks everything and steals anything not nailed down including the cover plates and maybe even the copper pipes which fetch a fair price in the scrap metal market? (Yes, I know people who've had this happen). 

As for your question about tenants, it depends on which province you are in, the legalities change for each. If you agree to provide the house in a vacant condition, you have to deliver it in a vacant state no matter the cost to you.

Being a landlord is more work than just owning a house...take it seriously before jumping in.


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## Romy (Jan 14, 2015)

Just a Guy said:


> First, make sure you file the paperwork properly with CRA so that your capital gains are properly calculated later.


Are you taxed on capital gains in this case? I think that when you sell your primary residence, you're not taxed on them. Would I be taxed in this case -- for the difference between the price of the house when I bought it and the price it fetches when I sell it a few years down the line?



Just a Guy said:


> How do you plan to manage the property from a distance?


I would be only an hour or two away.


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## Spudd (Oct 11, 2011)

You need to get the house appraised when you start renting it out, because you have to pay capital gains on the difference between the selling price and what it was worth when you turned it into a rental. 

I think you can just leave the tenant in there when you want to sell it, often you will see "tenant is willing to stay" in real estate ads. If the person buying it wants to live there themselves, they can kick the tenant out because they want to move in. If they want to rent it out they'll be happy they have an existing tenant. 

I don't know if you can kick them out in order to put the house on the market (i.e. wanting to have it vacant, clean, tidy for showings). Hopefully someone else will come along who knows.


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## none (Jan 15, 2013)

Once you start renting it out it no longer becomes your principle residence. Of course, it's not immediate but adjusted based on how long you lived in the home prior to renting it and how long you rented it for.

Just sell it.

http://www.taxtips.ca/personaltax/propertyrental/changeinuse.htm


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## wendi1 (Oct 2, 2013)

Really bad idea. Why would you do this instead of a) selling the house and buying a new principal residence in your new location, or b) selling the house and buying a rental property in your new location?

If you want to be a landlord, you have to read up on the law in your area. It's a business like any other. But don't become a landlord because you are too cheap to pay a realtor, or don't want to take the time to sell it yourself.


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## Berubeland (Sep 6, 2009)

In Ontario you can only give notice once the house is sold and if the new owner requires occupancy. Tenants can and do sue for notice in bad faith. What really blows my mind is that realtors don't know this in many cases.


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## chriswright (Sep 29, 2015)

*Selling a house with a tenant in it!!*

Firstly, Right up with a agreement of between you & the tenant who buys your house on the rent.

Another positive way, you can contact with the *Realtor* that they have to face the such problems. 



Romy said:


> Hi there!
> 
> I'm about to move to a new city. Instead of selling my house (and paying hefty agent commissions), I thought of renting out my house to a tenant, then putting that income toward renting in my new location.
> 
> ...


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