Texas. It is really not one of the insanely expensive house in Silicon Valley. (But this house is all we have in terms of real estate property, ie., we are not rich. LOL.)
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This is a good point. I have not thought of this possibility.
It is no secret that she is interesting in closing a house buying/selling deal. The tenants are definitely potential buyers. As far as I know (from our agent), they are interested in buying our house. The only “problem” for her to close a deal is that we are not interested in selling now (I heard she manages many properties so one of them may be up for sale.). It is conceivable that she MAY show them some of the houses she manages. But this is purely my speculation.
Only my wife has met this agent before. I have never met her. So I really do not know this agent at all.
I’d politely have agent say, “No.” They aren’t offering you any incentive to change the terms of their low rent lease and there is no good reason to agree.
It sounds to me that they already had a plan to do this at some point when they signed the last lease. The agent doesn’t care because she is going to get her money anyway. I would just say no. It does not work with your plan. Sometimes in life you have to not be the nice guy. This is one of those cases where the tenant and/or agent is trying to pull one over on you. They should have tried to do a m2m when the last lease came up. People don’t all of a sudden decide to look for a house. They have probably been looking for a long time and finally found one.
When I looked up tenant’s rights in Texas, it’s the same deal as Washington state, if they break a lease. They have to pay the full term, however the landlord needs to make a good faith effort to find a replacement tenant, then they stop paying. The landlord doesn’t have to accept new tenants with bad credit or take below market value rent, but they have to try to rent out the place expeditiously. All costs associated with rerenting it can be charged to the tenant breaking the lease.
I would be really curious to hear what the real estate agent says about this one. If she has no problem with the possibility that they could leave on Feb 1st, that’s very fishy. I would listen to what she has to say, and unless she sounds very reasonable, or has an idea of an alternate offer that sounds attractive to you, I would just say, “NO,” and not worry one more minute about it.
Since you don’t know your tenants or your real estate agent, I think the “treating it like a business” perspective would be easy for you. I have a terrible time with that, but if I didn’t know anyone involved, it would be far easier. I need a good agent so I don’t keep getting suckered, and don’t have to have contact with tenants. Who I feel sorry for!!
It seems many here think this is not a good deal for us.
For us, either one of the following is fine for us:
They find their house and return the house to us in either May, or June. We do not like their idea of having the options of returning the house to us in Feb, March or April at their will.
If they are unable to find a house they are willing to buy by that time, we are fine to have them as tenants for another year, as long as they sign a new year-long lease contractor with us starting 7/1/2016 and ending 6/30/2017. We are not interested in signing a m2m lease with them when our original lease is up. (I think it is in July?)
I think your options are very reasonable. It is tough to rent over the winter. They can take it, or leave it, it’s their choice. They knew the deal going in, which was very standard. If the real estate agent makes a fuss about it, I’d be wondering why.
It’s also good for leases to begin and end at similar times as others in the area, so you have a wide pool of desirable tenants instead of having to select among slim pickings, who may have iffy credit.
We do not offer monthly leases–only one year or longer–better clientele and less turnover.
You say you are not willing to rent month-to-month after the current lease is up. Keep in mind that if they do not sign a new lease and do not move the contract will automatically convert to a month- to -month rental. To avoid that, you have to present them with the new lease well before the expiration of the old lease and if they dont sign it by 30 days prior to end of the term, you would have to give them formal notice 30 days prior to end of lease (or whatever notice is required in the contract) telling that that they must move when lease expires. If you dont give that formal notice, you then have a month-to-month tenancy. Of course, with a month-to-month tenancy, you could require them to move by giving them 30 days notice at any time.
If you decide to go,month to month…make it clear to the tenants and agent that YOU are looking for a tenant who will sign a year’s lease at the prevailing (not discounted) rate…and when you find one…YOU will be asking these tenants to find another place giving them 30’days notice.
in re post 47: some leases state that unless one party terminates a year-long lease, then it renews for a year. In those cases it would not automatically renew on a m2m.
While some here have said go for it, and some have said no, I recommend that if you will consider it, then ask how the current tenants want to “sweeten” the terms to tempt you to change. Let them know you have a lease in place that you like, but permit them to start the ball rolling on a negotiation. If you don’t like what they offer then counter-offer or just decline and leave the current lease in effect.
Here again, I’m not an atty. and laws vary by state but I doubt you could require a 60 day notice if you were in a m2m lease. It just seems counterintuitive to think 2 months notice could be required in a m2m. The whole point of a m2m is so both parties are not bound beyond a month. Just because a term may be in a lease and may be agreed to does not necessarily make it enforceable.
When we bought our house, we were renting a townhouse in a complex. Had a one year lease initially which rolled over to a m2m after a year. We had to give 60 days’ notice to the complex. House seller wasn’t happy, but by the time all the loan papers, inspections, etc. were done, we couldn’t have settled much earlier anyway.
@greatlakes , this is a house far away from me, the local realtor said she finds people cannot look past the mess, so I went with her recommendation. In 8 years this is the first time I had a single day unpaid and she does a good job finding quality tenants, so I went with it, grumpily
exactly what I meant, countingdown, your post 51.
A lease can say 60 days notice necessary, but even if both parties agree, that does not necessarily make it enforceable.
There is a legal difference. Enforceable being the key word. Some people think anything both parties agree to is binding. Not always so.