Selling a Tenanted Home or Basement Unit in Ontario
Tenants change the rules of the sale
Many Brampton homes have a basement suite, and many investors own homes with tenants upstairs and down. You can sell a tenanted property in Ontario, but the tenancy doesn’t end just because the house is sold, and getting it wrong can delay closing or lead to a Landlord and Tenant Board claim.
Your three options
1Sell with the tenants staying.
Best when the buyer is an investor. The lease and the rent carry over to the new owner. A strong rent history can support your price.
2The buyer moves in (Form N12).
If the buyer, or their family member, intends to live in the unit for at least a year, the seller can give the tenant notice on Form N12 after the sale is firm. The notice must be at least 60 days and end on the last day of a rental period, and the tenant must receive one month’s rent in compensation or an acceptable alternative unit.
3Agree on a move-out with the tenant.
Sometimes the cleanest path is a voluntary agreement to end the tenancy (Form N11), often with a payment to the tenant. It must be genuinely voluntary.
Showings and preparation
- Tenants must get at least 24 hours’ written notice before a showing, for a time between 8 a.m. and 8 p.m.
- A cooperative tenant is worth a lot. I usually recommend agreeing on a showing schedule, and sometimes a thank-you for keeping the unit show-ready.
- Have the lease, rent amount, deposit and any rent increases ready. Buyers and their lawyers will ask for them.
- Be clear in the agreement of purchase and sale whether the property is sold with vacant possession or subject to the tenancy.
Questions people ask
Can I sell my house in Ontario if I have tenants?
Yes. The tenancy continues with the new owner unless it is ended properly, for example by an N12 notice when the buyer intends to live in the unit for at least one year, or by a voluntary agreement with the tenant.
How much notice does an N12 require when a house is sold?
At least 60 days, ending on the last day of a rental period, and it can only be given after there is a firm agreement of purchase and sale. The tenant must be paid one month’s rent or offered an acceptable alternative unit.
Do I need to tell buyers about the tenant?
Yes. The lease terms, rent and whether the property is sold vacant or tenanted must be clear in the agreement. Sandeep Pawar prepares this with your lawyer before listing.
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Sandeep Pawar, Broker · RE/MAX Gold Realty Inc., Brokerage · 2720 North Park Drive, Suite 201, Brampton, ON L6S 0E9 · All offices