Massachusetts Tenant Rights When House Is Sold

by | Jul 1, 2024

Massachusetts is one of the most tenant-friendly states. Its fair protections for both tenants and landlords create fair resolutions in various domestic situations.

This blog will briefly overview tenants’ rights and the legal protections tenants for landlords under Massachusetts law.

Key Takeaways

  • Leases and their terms transfer when a home is sold. The new owner must honor the lease, but they don’t have to renew it.
  • In Massachusetts, landlords are required to notify tenants properly if they intend to show the property to prospective buyers.
    Negotiating a structured lease termination payout, or “cash for keys,” can be an effective solution for landlords and tenants.

Types Of Tenants

  • Fixed-Term Tenancy: A rental agreement that lasts for a set period, such as six months or one year. During this time, the landlord and the tenant can only terminate the lease with a valid reason if both parties agree.
  • Periodic Tenancy: A periodic tenancy is a rental agreement that continues indefinitely until the landlord or tenant gives termination notice.
  • Tenancy-At-Will: A rental agreement with no fixed end date. It allows either the landlord or tenant to terminate the lease at any time with proper notice. This arrangement provides maximum flexibility, as it continues as long as both parties agree and can be ended without specific cause.
  • Tenancy At Sufferance: Tenancy-at-sufferance occurs when a tenant remains in a property without the landlord’s consent after the lease term has expired. The tenant is not legally permitted to stay, and the landlord may evict them. This situation continues until the landlord takes action to evict or establish a new tenancy.

Is Being A Tenant At Will A Bad Situation?

Being a tenant at will may not be ideal if you’re looking for a stable lease that lasts a full year. We’d recommend you have a lease in writing. Many tenancy at-will agreements are just handshake agreements that aren’t legally enforceable.

If your current 12-month lease is about to end, review it to ensure there is a clause stating that it defaults to month-to-month. When it ends, ask to sign a new month-to-month lease. To “evict” a tenant at will, the landlord must give the tenant notice either 30 days or one month before the due date of the next rent payment (whichever is longer).

Can New Owners Evict Tenants?

New homeowners can evict tenants, but they must follow legal procedures. If the buyers want you out, they must follow the law. They can’t assume ownership and then evict you. They become your landlords and then must give you the required notice of not renewing your lease to end your tenancy.

If you had a year lease, they would have to honor that through the lease period. Personally, monthly leases have the upside of greater flexibility in terms of you moving out, but that’s the only upside. You have less protection than a fixed lease tenant, with shorter required notice periods for a landlord to give you and no protection from random rent increases.

Notification Requirements

In Massachusetts, landlords are required to provide proper notification to tenants if they intend to sell the property. Here are the key notification requirements:

  • Right to Show the Property: The landlord must give the tenant “reasonable notice” before showing the property to prospective buyers. Tenants have the right to privacy and must be notified before any showings. They are not required to vacate the property during showings but must allow access as long as reasonable notice is given.
  • Lease Agreements: If a tenant has a fixed-term lease, the new owner must honor the lease terms until the lease expires. The lease agreement terms do not change with the sale of the property.
  • Month-to-Month Tenancies: For month-to-month tenants, the new owner can choose not to renew the tenancy with proper notice. In Massachusetts, this typically requires at least 30 days’ notice.

Buying A House With Active Tenants

Generally, you should avoid buying a primary residence with active tenants. If you’re an interested buyer, make sure the seller deals with the tenants legally before signing at closing. If you’re buying a property for income.

Structuring A Lease Termination Payout

Negotiating a structured lease termination payout, or “cash for keys,” can be an effective solution for landlords and tenants. Offering a monetary incentive, such as $5,000, to vacate by a specified date ensures a smooth transition. Landlords benefit by presenting a vacant property to potential buyers, while tenants receive compensation for relocating, which is usually a hassle.

Ensure this agreement is formalized, tenants comply, and the property is cleaned. This approach helps avoid the complexities of dealing with incumbent tenants during a sale and offers tenants the financial support needed for moving expenses. Always ensure the terms are clear and mutually beneficial.

Inheriting Bad Tenants

Having the property delivered vacant and clean is often preferable, especially with troublesome tenants. Be prepared to walk away from a deal with unfavorable conditions is also a key strategy for managing inherited tenants successfully. Remember, with Massachusetts’s airtight eviction laws, you need to screen tenants and use proper legal notices to address issues.

Security Deposit

One of the tenants’ essential rights when buying a property with existing tenants is to receive their security deposit back. The original landlord is responsible for guiding the tenant in collecting this deposit when the tenancy ends.
A new landlord can still make deductions from the deposit for reasons like property damage, unpaid rent, or other valid uses of the deposit as outlined in the lease agreement. This ensures that the tenant’s obligations are met even with the change in ownership.

Selling A House With Active Tenants

If you’re selling a property with tenants, the length and terms of their lease will affect your type of buyer. People interested in investment properties may look for a home with an established tenant that would be more attractive. Therefore, discussing the removal of tenants should wait until a buyer says they want a home vacant at closing.

Switching From Year To Month-To-Month Lease

Landlords are not required to renew leases at the end of the year. If tenants are considering selling their homes, you can negotiate switching to a month-to-month lease. This gives the tenant longer in their home, allows the landlord to continue to collect rent, and times the move-out with closing.

Condemned Homes And Tenants

Many property owners find themselves in a situation where they can’t afford to repair a home in disrepair. Their tenants don’t mind the living conditions enough to report them to local authorities. They know that doing so would spell the end of their tenancy and force them to find somewhere else to live. This situation can be advantageous to real estate investors, who can swoop in and offer a solution to the property owner. When a home is condemned, this may automatically terminate any existing lease.

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Contact us below or call (978) 228-1068 to speak with us about selling your home fast.

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Elie Deglaoui - Author

Author

Elie Deglaoui

Elie is our office admin who handles all our day-to-day tasks and makes sure we always stay on track. He brings his love of music and sports into the office everyday to always liven up the environment. His outgoing personality makes it easy and fun for him to talk to homeowners, homebuyers, and everyone in between.

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