Why This Happens More Often Than You’d Think

Toronto’s condo market is a major hub for investors. Whether it’s someone cashing out after a hot run-up in value or a homeowner relocating, selling a condo that’s currently rented out is more common than you might think. With so many units being used as income properties, it’s not unusual to find listings with tenants still living in them.

We often advise clients to sell without a tenancy in place when possible. A vacant unit is easier to stage, show, and market to a wider range of buyers. That said, selling with a tenant can be done — it just requires extra planning, legal steps, and some cooperation.

Can You Sell a Condo That Has a Tenant?

Short answer? Yes. Under Ontario’s Residential Tenancies Act (RTA), a landlord is allowed to sell a property even if there’s a renter living in it. However, the lease doesn’t automatically end with the sale—it travels with the property unless specific legal steps are taken.

That means if you sell your condo, the buyer will typically inherit your tenant and must respect all lease terms unless:

• You and the tenant sign a Form N11
• The buyer plans to move in and uses a Form N12 to legally end the lease

Ontario’s Rules for Selling with a Tenant

Fixed-Term vs. Month-to-Month Leases

If the tenant is in the middle of a fixed-term lease (say, a one-year agreement that ends in November), the buyer must honour that term. After the term ends, the lease becomes month-to-month, and you or the buyer may have more flexibility to issue notice.

N12: Buyer Wants to Move In

This form allows a landlord to end the lease only if the purchaser (or their close family member) plans to live in the unit. Here are the conditions:

• 60 days’ notice from the start of the next rent cycle
• Buyer must pay the tenant one month’s rent or offer comparable housing
• The buyer must genuinely intend to move in—false use of N12 can lead to hefty fines
  Read Form N12

N11: Mutual Agreement to End Tenancy

This is a voluntary agreement between landlord and tenant to end the lease early. It’s often used when the seller wants to market the unit vacant and agrees to offer an incentive.
Read Form N11

Three Ways to Sell a Tenant-Occupied Condo

1. Sell with the Tenant in Place

This option involves transferring the lease and deposit to the buyer. It appeals to investor buyers looking for turnkey income. Downsides? It may limit your buyer pool and restrict showing availability.

2. Negotiate a Vacant Possession with N11

Many sellers offer “cash-for-keys” to tenants in exchange for a signed N11. This allows you to list the unit vacant, stage it beautifully, and attract a broader pool of buyers (especially end-users).

3. Include N12 Condition in the Offer to Buyer

In this case, the unit is sold with the tenant, but the buyer intends to move in. The N12 is served after the sale, and the buyer assumes the legal and logistical responsibility of giving notice and handling any disputes.

What This Means for Pricing, Showings, and Strategy

Pricing Impact

Units sold with tenants often fetch less than their vacant counterparts. This is due to staging limitations, buyer uncertainty, and timing constraints. If the tenant has below-market rent, that can either help (investor value) or hurt (owner-occupant expectations).

Showing Challenges

Under Ontario law, you must give the tenant 24 hours’ written notice and conduct showings only between 8 a.m. and 8 p.m. Uncooperative tenants or messy units can make for a tough sale.

When Cash-for-Keys Makes Sense

If maximizing price is your priority, offering 1–3 months of rent as an incentive to vacate can make all the difference. It speeds up the process, removes resistance, and gives you full control of how the unit shows.

Real Stories from the Field

We’ve worked with several sellers in this exact situation. One client offered two months’ rent to their tenant, who gladly accepted and moved out early. The now-vacant unit was staged, professionally photographed, and sold over asking in under a week.

In another case, the tenant remained in place. The buyer was an investor happy to assume the lease—but we made sure to schedule showings around the tenant’s work-from-home hours to keep the peace (and presentation).

Key Tips for Sellers

• Communicate early and respectfully with your tenant
• Offer fair compensation if asking for early move-out
• Time your sale around lease milestones
• Understand your buyer (investor vs end-user)
• Work with realtors familiar with landlord-tenant law
  

FAQ – Selling a Condo with a Tenant in Ontario

Can I sell with a tenant in place?
Yes, but the lease continues unless terminated by mutual agreement or N12.

Can the tenant refuse to leave?
Yes, unless served a valid N12 or they voluntarily sign an N11.

Do I need the tenant’s permission to list the condo?
No. But showings require 24 hours’ notice and must follow legal time windows.

Will selling with a tenant lower my price?
Often, yes. Especially if the buyer is an end-user or the unit can’t be staged.

What if the buyer is an investor?
They’ll likely welcome the tenant—and inherit the lease and deposit at closing.

What’s the penalty for bad-faith evictions?
Fines up to $50,000 for landlords who issue N12s but never follow through.

Final Thoughts: Selling Smart, Selling Legal

Selling a condo with a tenant in place is totally doable—but it takes strategy, legal know-how, and a bit of finesse. Whether you keep the tenant, negotiate a move-out, or let the buyer take over the process, the key is doing it by the book.

Want help navigating your options? Connect with us, or leave us a message below!