Should You Have Vacant Units When You Sell Your Minneapolis Duplex?

One of the most common questions I get when a long-term Minneapolis or St Paul duplex owner considers selling is, “Should I leave a unit vacant?”

There are two philosophies behind this; 1. It makes showings easier and 2. An owner-occupant buyer has an opportunity to move in at closing. Both of these are great thoughts.

The problem is they cost the prospective seller money. How so? While the property is on the market, and in the time between an offer being accepted and the title changing hands at closing.

If that’s the case, what’s the alternative?

In my opinion, it’s simply to have at least one tenant on a month-to-month lease. Most lenders require an owner-occupant to move in within 60 days of closing as a condition of their loan. Many buyers ask the seller to give notice to vacate to the tenants prior to closing.

Of course, as a seller, it is best to do this only if the buyer has removed all conditions for the purchase. That way there is less risk of the buyer not closing and the housing provider losing a good tenant.

And if the buyer is an investor? By having a tenant on a month-to-month lease, the buyer gets the opportunity to raise rent, remodel the unit, or keep them.

Of course, tenants on month-to-month leases may also choose to move out when they see a for sale sign in the yard. However, per the terms of the lease they were under, which usually auto-renews on a monthly basis, they are required to give notice. It’s entirely possible the property will sell before they move out!

In the end, keeping tenants in place on a month-to-month lease is a win for the seller, the buyer and the tenant.