Selling a House with Squatters

by | Oct 9, 2020

It’s a strange time to be a landlord in America. The CDC has declared a temporary ban on some types of evictions. Tenant groups across the country are calling for rent strikes. And as more and more people are unemployed or furloughed because of the pandemic, with economic aid coming in fits and starts, many tenants simply can’t pay rent, leaving landlords struggling to pay mortgages. It’s no wonder many small-scale landlords are deciding that now is the time to sell. But even if they provide their tenant with plenty of notice and make sure their sale is perfectly legal, they can run into a strange quirk of the law: tenants may simply refuse to move out.

What is Squatting, and Why is It Legal?

The technical term for occupying a home without the owner’s consent is adverse possession, but it’s more commonly known as squatting. In the United States, the squatters’ rights movement began in the nineteenth century, when settlers built homes and farms on undeveloped federal land. Congress passed an 1841 law saying that these squatters had the right to purchase the land they had developed if they could raise the cash before it went up for auction. Later, in 1862, the Homestead Act was passed, giving settlers the right to any land they had lived on and developed for five years. Squatting continued to refer to living in new lands well into the twentieth century.

In the 1960s, however, as wealthy Americans moved out of cities and the urban population shrank even as rent remained high and homelessness rose, more and more displaced people moved into abandoned homes. In 1982, the Bureau of Housing and Urban Development decided that the precedent of the Homestead Act should apply to underused urban spaces. They started the Urban Homesteading Program, giving squatters the right to buy up properties where they had lived for a certain length of time.

Squatting in Recent Years

The Urban Homesteading Program helped a little, but the homelessness rate in America has been on the rise for decades. On any given night, half a million Americans are homeless, and only 65% of them have somewhere to sleep. To fight the growing crisis, activists have aggressively campaigned to expand homesteading rights. Local laws vary widely, but in areas with high rates of homelessness, anyone who has lived on a property for a certain number of months has a right to live there and cannot be displaced without legal action. In other words, you cannot simply call the cops and have your tenants thrown out, even if you have title to the building. Consult a lawyer or check your local laws to find out what rights squatters have in your area.

The Covid-19 pandemic is likely to make it even harder to evict a squatter. Not only are homelessness rates rising as quickly as the economy slumps, but homelessness is growing even more dangerous. It forces people into crowded shelters and onto friends’ couches, making it impossible to self-isolate or quarantine. Homeless and displaced people are at a higher risk of dying from Covid-19 for that reason.

Landlord’s Rights

If your tenant is refusing to move, you need to make sure you’re not violating their lease, the CDC’s eviction moratorium, or any local laws. Then, if you’re sure you’re completely on the right side of the law, talk to them and see what their problem is. Maybe you can come to an agreement. But if you can’t, and if you have grounds to evict but they’re still not budging, you will probably have to serve them with a summons and bring them to housing court.

If they respond to the summons, the odds are very much in your favor. You are, after all, the owner of the property, and squatter’s rights laws aren’t supposed to apply to property with owners. In some areas, you may have to prove that you kept up the property to a “habitable” degree, a term with specific legal definitions that vary from state to state and from town to town. This means you may have to prove that you gave the tenant a certain number of warnings before throwing them out. In any case, if the tenant doesn’t respond to the summons, you win the case by default. With the odds stacked against them, tenants often choose to settle out of court, saving themselves and your legal fees.

What Not to Do

Until the court case is over, remember that the squatter has the legal right to live on your land. That means there are certain moves you shouldn’t make unless you want your case to get a lot more complicated.

Don’t call the police or any other security force. Remember, squatting is not a crime; if a court case is in progress, your tenant is innocent until proven guilty.

Don’t do anything that could cause damage to the tenant’s property. Some landlords send movers to begin unceremoniously packing up their tenants’ effects. But if anything is damaged in the process, the tenant has grounds to sue you, complicating your own ongoing legal case.

Don’t shut off gas, water, electricity, or heat. If you do, you are providing an uninhabitable home, which gives your tenant a legal right to live there without paying rent. This will complicate your case.

Don’t lose your temper. Remember, your tenant doesn’t own the property, but it is their home and you’re kicking them out of it. If they’re refusing to leave, it’s probably because they’re emotional and not thinking straight. Very often, all they want from you is a few words of sympathy.

If you’re trying to sell your home because of the Covid-19 pandemic, nothing is more frustrating than a tenant refusing to leave. But now that you understand the law and your own rights, you see how the case can be brought to an end quickly and without too much ill will, freeing you up to sell your house. Then, you can contact Sell Direct, and sell your house for more money with less fuss. Request a consultation today to find out how.

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