Buying a Property with Tenants in Pennsylvania

You find an investment property in a prime location in Warminster. The numbers look great, and there’s already tenants in place, meaning you can start collecting rent right away. Seems like a dream scenario, right? Not so fast. Buying a tenant-occupied property in Pennsylvania comes with legal complexities that could quickly turn your investment into a legal headache if you’re not prepared.

Pennsylvania law is designed to protect tenants, which means that when you buy a property with renters in place, you’re stepping into the shoes of the previous landlord—along with all their responsibilities and obligations. Before you jump into a deal, it’s crucial to understand the legal risks and how to navigate them.

Understanding Tenant Rights in Doylestown and Pennsylvania

The most important thing to remember is that leases survive the sale of a property. In Pennsylvania, when you buy a tenant-occupied property, you inherit any existing lease agreements. You can’t simply tell the tenant to leave because you want to renovate or move in a new renter. Bucks County has an online booklet summarizing the Landlord Tenant Act.

Under the Pennsylvania Landlord and Tenant Act, tenants have the right to remain in the property until their lease term expires, unless there is a legal reason for eviction. Even for month-to-month leases, landlords must follow strict notice requirements before making changes.

Reviewing Existing Lease Agreements

Before purchasing a tenant-occupied property, carefully review the lease terms. Look for:

• Lease duration – When does it end?
• Rent amount – Is it below market rate, and can you increase it? The typical rent in Doylestown has significantly increased over the last two years.
• Security deposit details – How much was collected, and where is it being held?
• Clauses on eviction and renewal – Are there special conditions or automatic renewal clauses?
• Notice requirement – Are you required to put the tenant on notice before filing suit.

If the previous landlord failed to follow Pennsylvania law—such as not properly handling security deposits—you could inherit legal troubles along with the property. That perfect Newtown duplex could prove to be a headache in disguise. Following these real estate attorney tips will help you to avoid the pitfalls.

Can You Evict a Tenant After Purchasing?

In Pennsylvania, a new owner cannot evict tenants just because of a change in ownership. The only legal reasons for eviction are:

• Non-payment of rent
• Lease violations (e.g., damage to the property, illegal activity)
• Tenant refusing to leave after lease expiration

If you plan to remove the tenant for a reason outside these conditions, you may need to negotiate a move-out agreement (often called cash for keys), where you offer financial compensation in exchange for the tenant vacating voluntarily.

A Doylestown real estate lawyer can help draft proper notices and ensure you follow all state and local eviction laws, avoiding costly legal missteps.

What Happens to the Security Deposit?

Under Pennsylvania law, when a rental property is sold, the new owner becomes responsible for the tenant’s security deposit. The previous landlord must transfer the deposit to the new owner, who is then required to notify the tenant in writing that they are now holding it.

Failure to properly handle the security deposit transfer can result in penalties, including the possibility of being unable to withhold funds for damages at the end of the lease.

The “Cash for Keys” Strategy to Remove a Tenant

If you want the tenant to move out but don’t have a legal reason for eviction, offering cash for keys is a common strategy. Instead of going through a drawn-out eviction process, you negotiate a payout in exchange for the tenant vacating the property on an agreed-upon date.

To make this legally binding:

• Have a written agreement specifying the move-out date and amount paid.
• Ensure the tenant signs a release of claims.
• Get legal guidance from a Doylestown real estate lawyer to avoid future disputes.

How to Evict a Bucks County Tenant for Non-Payment of Rent

What if you inherit a problem tenant—one who is behind on rent or causing disturbances? In Pennsylvania, you must follow the formal eviction process, which includes:

1. Providing the correct notice – review terms of your lease for notice provisions unless your lease has a waiver of notice.
2. Filing an eviction lawsuit in the local Magisterial District Court if the tenant doesn’t comply.
3. Attending a court hearing where a judge will decide if eviction is warranted.
4. Obtaining a court order and coordinating with the sheriff for the physical removal of the tenant.

Self-help evictions—such as changing locks or shutting off utilities—are illegal and can lead to hefty fines and legal consequences. Do not attempt to lock the tenant out of your new Warrington duplex. Leave it to your real estate attorney to handle properly.

Communicating with Tenants After Purchase

If you plan to keep the tenant, making a good first impression is key.

• Introduce yourself and explain how rent payments will be handled.
• Clarify lease terms and reassure them that their agreement is still valid.
• Set expectations regarding property maintenance and communication.

By being transparent and professional, you can build a positive relationship with your new tenant, making your investment smoother and more profitable.

How to Make a Tenant Occupied Property Work

Buying a tenant-occupied property can be a fantastic investment—if you do it right. The key is to conduct thorough due diligence, understand Pennsylvania’s landlord-tenant laws, and seek legal guidance when needed. A misstep in handling leases, security deposits, or evictions can lead to costly lawsuits and delays.

Before finalizing a deal, consult a Doylestown real estate lawyer to review lease agreements, ensure compliance with Pennsylvania law, and help you navigate any legal hurdles. With the right approach, you can turn a tenant-occupied property into a profitable, hassle-free investment.