What happens to tenants when a rental property is sold?

Wondering what happens to tenants when a rental property is sold? When a rental property is sold, the buyer assumes the lease from the previous owner (seller) and is required to honor the terms of the lease.

When the lease agreement expires, what happens to the tenant depends on the condition of the property, performance of the tenant and the objective of the buyer.

If the property is in acceptable condition (no major rehab is required), the tenant is current on their rent payments and abiding by the terms of the lease agreement, and the buyer is a rental property investor, the buyer will want to keep the tenant in place once the lease is up for renewal. In this situation, the buyer may raise rent to "market rate" if the expiring rent rate is objectively low and require at least a 1-year lease term.

If the property is in unacceptable condition or the buyer desires to conduct a major renovation, the tenant is not performing, or the buyer is looking to move into the property as their primary residence, then the buyer will issue a notice of non-renewal and a notice to vacate. Depending on local law, this can be 30 or 60 days from the first of the month.