I have been asked by a friend of a friend of a friend about this as I have been to the islands before. Someone wants to rent a condo in 2013 for a week of vacation. It turns out this condo is also up for sale. What happens if the person that rents this unit pays up the deposit to the current unit owner but then the condo unit sells to another owner? Is the vacation contract still valid? Or does the renter just give up any deposit and down payment they made and are totally screwed?

An existing contract is legally contingent upon the successor to honor it under all the terms and conditions originally advertised. I would estimate that at least 30% of vacation villas and condos are currently listed for sale. Again, the buyer assumes all responsibility for all contracts. No worries!

at worst you're screwed and rent another accomodation. at best the new owners honor the rental contract without significant changes to the unit.
most likely the unit won't close before the rental date. if you see a the unit adveritesed for sale it's best to get assurances in writing from the owners. I suppose the owners (who contracted with) would be obligated to refund deposit. I would be leary of renting anything for sale without written assurances.
What's leagal and what's reality are often two different issues. I supose if the unit sells and your contact is cancled you can pursue leagal remendies--but who wants to do that. Better all contigency are transparent up-front. Lot's of nice rentals that aren't for sale and lots of nice owners (who are willing to be completely honnest) with units for sale.

blu4u, you obviously know nothing about contract law as it applies to real estate transactions. The information I gave is correct and standard and there is no, "at worst you're screwed " scenario such as you describe.

Your correct I haven't viewed the rental agreement. Nor have I viewed the listing agreement. Nor will I view the future escrow agreement. I don't know if whats excluded /included. and I would assuem any lawsuit involving breach of contract would limit damages to the deposit and possibly "replacement value". But what the heck? why go that far? why not simply have an open and honest conversation with owner? If the owner's evasive, book another accomdodation. Vacation is supposed to fun and stress free. Believe there are plenty of very nice condos in the VI.

All issues regarding monies for rentals income are addressed in the closing docs. if there is a sale.
I have not heard about any problems with guests being defrauded for their deposits for a vacation rental due to their chosen vacation rental property being sold prior to arrival.

That's not to say it is not possible for it to occur but it is not usually the case.
Many listings for vacation rentals have clauses that the advance bookings must be honored.
If a situation were to occur, the guest(s) has several options to recover their money.

If you are concerned, contact the owner and ask directly what contingencies he/she has made for your contract to be honored in such event.

It is a good thing to purchase travel insurance. I recommend this to guests traveling during Hurricane Season as many rental accommodations of all types do not wish the liability that having guests in residence during a severe storm may incur and this goes for many hotels as well.

Best to check on your vacation rental policies for such an event.
It helps to document and get such policies in writing.



Edited 1 time(s). Last edit at 10/12/2012 11:04AM by Alana33.

Hey Blu - spell check is working!

Quote
STT Resident
blu4u, you obviously know nothing about contract law as it applies to real estate transactions. The information I gave is correct and standard and there is no, "at worst you're screwed " scenario such as you describe.

Quote
blu4u

Quote
STT Resident
blu4u, you obviously know nothing about contract law as it applies to real estate transactions. The information I gave is correct and standard and there is no, "at worst you're screwed " scenario such as you describe.

Your right, I am not a real estate attyn. Since you are expert in tennet landlord relations, maybe you could answer a few question.?
What happens in the case of foreclosure?
What if the new owners aren't accommodating? Who do you sue? the original party to the contract, The party who assumed the contract? The real estate agents who facilitated the contract? How much does that cost?
Since it's small amount, how does one pursue a small claims judgment from 1,000 miles away?
Don't you agree it's best to question the property owner beforehand? Rather than rolling the real estate-contract-law-dice?

I agree check with the owner!

From personal experience here on St Croix, rentals have been passed onto new owners and renters were also given option of an upgrade and assistance placing in a new rental at same rental rate. Both win win options!

Everyone posting has at least partially and in some cases grossly misinterpreted the law of Contracts. Unless a prospective buyer agrees to honor the existing rental booking, there is no privity of contract between the buyer and renter and thus no contractual obligations on Buyer's part. Existing bookings are typically resolved in the signed Contract between buyer and seller and should contain language that the Buyer's obligation to honor the booking "shall survive the closing." Any deposits are typically transferred as a credit to buyer at the closing of the property.