It’s clear that selling a tenant occupied home can be challenging:
- The are notice requirements (that can be negotiated)
- The tenant may be non-cooperative (they may be great)
- The may refuse to leave for showings (and talk negatively about the landlord and property)
- The property may not be in “showroom condition” for showings
- Showing may be hard to set up
- Agents may choose not show at all because of notice requirements
That said, you could have great tenants and there is nothing that guarantees a vacant or owner occupied property isn’t going to have some, if not all, of the issues above. Additionally, a buyer with owner-occupied financing may be required to move into the home within 30-60 days. If the tenant’s occupancy is for longer than that, the buyer pool may shrink.
These are all hypothetical issues. What’s the math? I took 500 recently sold tenant occupied properties, 500 vacant properties and 500 sold properties in Portland from RMLS and discovered the following:
Average Days on Market:
- Tenant occupied: 49 days
- Vacant: 38 days
- Owner occupied: 19 days
Average Selling Price per Square Foot:
- Tenant occupied: $166
- Vacant: $173
- Owner occupied: $195
We clearly see that tenant occupied properties spend more time on the market and sell for less than their vacant and owner occupied counterparts.
