Can Your Landlord Sell the House You’re Renting? Yes. With Certain Conditions.
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Disclaimer – The information on this page is intended for general informational purposes only and not to provide legal advice.
In Texas, a lease between a landlord and tenant survives a sale when the landlord sells the home to a new owner unless the lease explicitly states otherwise in writing. This means that if your landlord sells the house you’re living in, the new owner is assuming the current lease. That means they have to abide by the lease’s terms during the timeframe the lease covers – including the rent amount, and any terms or conditions of you living there. For example, if your lease says it allows pets, the new owner cannot change that allowance while the current lease is still in effect.
What happens when your current lease expires?
However, that doesn’t mean that the new landlord can’t change the terms of the lease once your current lease term is up. Let’s say you signed a two-year lease to rent a home at $1,600 per month. The landlord allowed you to have two dogs within the lease when you signed. Six months into your lease a new investor buys the home, assumes the lease, and becomes your new landlord. For the rest of the two-year term, the new landlord cannot raise your rent, disallow your pets, or shorten your lease term without your permission unless your current lease allows them to.
That said, at the end of your current lease, the new owner could choose to raise the rent to $1,800 per month and disallow any pets. You would either need to be willing to abide by the new rental rates and lease conditions or find a new place to rent.
What if you’re on a month to month agreement?
This also assumes that you are currently in a lease term and not currently residing in the property on a month to month agreement after an old lease expired. For example – let’s say you were renting a home under a one-year lease for $1,600 per month and were allowed to have two dogs. Your year-long lease expired, and rather than signing a new one-year lease, you simply continued to live there via the month to month holdover your original lease allowed. In that case, the landlord would only need to follow the month to month terms. So, the new landlord could choose to demand you begin to pay $1,800 per month and get rid of your pets – or move out – with only one month notice (in Texas – each state has its own rules regarding how much notice you have to give a month to month tenant).
What happens to your rental deposits when the home you’re renting is sold?
If you gave your current landlord a security deposit or funds to be applied to your last month’s rent, those deposits are typically transferred to the new landlord during the sale from the current owner.
How much notice does my landlord have to give me before showings and inspections?
Many states have statutes that detail out how much notice a landlord is required to give a tenant to gain access to the property for showings to prospective tenants or buyers. Texas is not one of them. In Texas, only “reasonable notice” is required unless your lease contains an “access” clause stating otherwise. The term “reasonable” could be the cause of debate; in general, most people would consider it reasonable to allow any showings or access where the tenant is provided with 24 hours notice.
What happens if the house you’re renting gets foreclosed on?
This is one of the few ways a home can change ownership in Texas without the lease surviving the sale even if the lease doesn’t contain language that allows termination of the lease upon sale. Unfortunately, if the home you are renting is foreclosed on, you might be evicted once the home is sold at auction. The reason I use the word might is that many people who buy homes at auction are real estate investors and don’t pursue an eviction on paying tenants. There’s a decent chance they may choose to continue to rent you the home. However, the catch would be that it would be under a new lease that may have different terms than your current one.
If you’re getting notices in the mail saying the home you’re renting is going to be foreclosed on, you’ll want to ensure the landlord is made aware of the notices immediately while they potentially still have time to avoid the foreclosure. If you’re unable to reach your landlord, feel free to reach out to us by contacting us online or by phone. We have super sleuth powers when it comes to finding people, and might be able to purchase the home from your landlord before the foreclosure and potentially allow you to continue renting the house.
What if your new landlord is trying to change the terms of your lease before it expires?
If your new landlord attempts to alter or break your current lease and your lease does not state that it terminates upon the sale of the home in writing, you might want to contact a local real estate attorney to enforce your rights.