How To Get Your Tenants To Move Out During a Fixed Term Lease

How To Get Your Tenants To Move Out During a Fixed Term Lease

How To Get Your Tenants To Move Out During a Fixed Term Lease

How To Get Your Tenants To Move Out During a Fixed Term Lease

It is a great feeling to have your rental property occupied by great tenants, knowing that you are getting a return on your investment and the house is well looked after. That is, until you need them to move out.

There could be any number of reasons that you need to have your property vacant. Perhaps you want to sell the property without tenants because you don’t want to limit your market to just investors. Maybe you unexpectedly have to move back into the property. Whatever the reason, it is your property, and if you want your tenants gone they should leave, right?

Unfortunately, it doesn’t quite work that way. Our society is built on the notion that “every man is king in his own castle”, and if they are not violating the terms of their lease, there is no way you can legally (or morally) force them to leave. As long as the tenants are living up to their end of the rental agreement, there is almost no way that a property owner can force them to vacate the property.

That being said, there is no regulation that says you cannot ask them nicely.

Ryan’s Problem

One of the owners I work with, we’ll call him Ryan, came across this situation. He had some great tenants living in his house on a fixed term lease, but the problem was he needed to move back into his house ASAP and the tenants still had another 6 months left to run on their lease. To complicate the matter further, the tenants’ baby was due around the same time.

Ryan and I had a good chat. We came to the conclusion that his best bet was to talk to the tenants and be prepared to offer an incentive for the tenant to move out early. Ryan thought that offering $1000 to help with moving costs would be effective, but before he made the offer, I took some time to coach him on negotiating with tenants.

Negotiation

Before beginning any negotiation, it is good to take a moment to define your goals. This way, you have a better chance of getting what you really want. In this case, Ryan wanted to have his tenants vacate as soon as possible, and well before the tenants’ new baby gave them a strong reason to not move.

Since he was willing to invest $1000 in getting the tenants to move out early, we had to decide how best to use the funds. I recommended instead of just giving a straight $1000 to move out early lets reduce the incentive as we got closer to the end of the lease. The plan we came up with was that Ryan would only give $1000 if the tenant moved out in the next 3 months, but if they moved out in the final 3 months of the lease, the tenants would only get $500 (instead of the full $1000).

Now, you may be working within a smaller time frame but you get the idea.

If the tenants waited until the end of the lease, Ryan would have just given an ‘end of lease’ notice to vacate so the tenant would have had to move out anyway without receiving any of the $1000 on offer.

There were a couple of points that I felt were important for Ryan to keep in mind before he went to talk to his tenants. First of all, he needed to remember that he’s not in a position to demand anything, he is asking his tenants for a favor. This is another reason it pays to keep good relations with your tenants. People only do favors for people for two reasons; it is in their own self interest and/or they like the person who is asking.

I advised Ryan to explain his predicament before presenting the incentive. Who knows, the tenants might hear what he has to say and decide ‘Sure, we are going to have to move anyway, and if it helps you we might as well do it sooner’ (or who knows the tenants may have been thinking about finding a bigger place anyway).

Just in case he did have to break out the incentive plan, he needed to have the deal written out so there would be no confusion about how the deal would work. Tenants appreciate seeing things in writing, and outlining the agreement will ensure that there are no grey areas and the tenants can rely on this information to make a decision to move out early.

Did the Tenants Move Out Early?

The tenant didn’t really want to move out, but thankfully there was enough incentive to move out early. The tenant was unable to move out quick enough so the they only got the $500, but at least Ryan was able to move 2 months before the lease ended. The tenants still got $500 to help with the moving costs.

Most tenants only need a month or two to find a house and move in, but there are instances like Ryan’s where his tenant was pregnant, which makes things difficult. You need to adapt to the situation and be respectful of your tenants situation, as well as the legal agreement that you have between each other.

Have you ever had to ask your tenants for a favor that was not specified in the lease? Please share the story in the comments below and let us know how you handled it.

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About Michael Gilbert

Michael is passionate about real estate. He has been living and breathing it for the past 8 years and loves helping people with anything property-related. Being a real estate agent has given Michael a real insight into what people want. His competitive nature keeps him going whether it’s on the soccer field or creating what he believes will be the greatest property management system ever.