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I own a single-family house in Germany, and consider to sell it. It has been rented out for about ten years, and the tenant gives the impression he wants to stay forever (he does not yet know about my ideas). I know that the plan to sell is not a legal reason to terminate the rental contract; probably there is no legal way to get the tenant out at all. What are my chances and options to sell the house while rented, and how should I proceed?

The house is in good shape, well maintained, and in a pricy and sought-after area. However, prospective buyers in that area typically want a house to move in, not for investment. I have not yet tried to contact local realtors (I live 8000 miles away). The rent is not very high, as the official usable area calculation does not take into account the fully-usable half-basement (it has not the officially necessary minimum height).

  • Should I tell the tenant and ask him if he wants to buy (that would be an easy option; but if it goes ugly, it can't be un-told)?
  • Should I just try to find a realtor and let him handle it?
  • What percentage of an 'empty-house-price' can I realistically expect?

There are no bank, tax, or mortgage issues. The point is just how to approach the sale for an optimal deal. Any experiences and/or recommendations?

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  • My parents frequently changed landlords while not moving at all. They just received a letter that the owner of their house was going to change, and that was that. – gerrit Jun 14 '16 at 13:10
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    How long is the rental contract for? – Joe Jun 14 '16 at 14:41
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    In Germany, rental contracts are typically unlimited. Limited time contracts are possible but uncommon. So it ends when the tenant wants to move out (with a 12 months notice); I can only end it if I have a legally valid reason. – Aganju Jun 14 '16 at 14:46
  • I don't know for Germany but it might be possible to break the lease if the buyer want the house for himself/familly. At least here in Canada that's a valid reason. You might not be able to break the lease because you sell but the buyer might be able because he want to use the house as his home – Rémi Nov 4 '16 at 14:23
  • No, there is a 10-year legal lock on both those situations in Germany. I have no hope to get the tenant out; my point was how to best approach a sale with tenant. – Aganju Nov 4 '16 at 23:59
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A realtor won't be able to help you. As you already said, selling the house is not a valid reason to terminate the rental contract.

I think asking your tenant whether he wants to buy should be your first step. He will realize eventually anyways that you want to sell, at the latest once potential buyers show up to see the house. If you can sell to him it's the least hassle for all of you.

If he doesn't want to buy, maybe you can reach an agreement to end the contract for a compensation.

Other than that you have little chance to get rid of the tenant legally. The buyer of the house can of course terminate the contract if he wants to live there himself (Eigenbedarf), but he has to respect the termination periods. And if the renter just doesn't want to leave and just won't move out it will be a lot of hassle for the buyer.

I have no idea about the market prices for houses with a renter, but considering the waiting time involved where the buyer still needs other housing, and the potential legal costs and hassle to get rid of the renter, I guess you have to give a substantial discount for anyone to be interested.

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    The right realtor would be able to find investors looking for more property to rent out, much better than OP can from 8000 miles away. – RemcoGerlich Jun 14 '16 at 8:15
  • STUPID advice. There is a whole universe - particularly in germany - of people buying and selling houses to COLLECT rent. Rented out houses with a long term renter are a PLUS there. The majority of people in germany RENT. tw., Eigenbedarf has a 3+ year block period for new buyers BEFORE you can claim it, by law. – TomTom Feb 16 at 10:23

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