What happens to a lease when the property is sold during the lease term?

When a property is sold during an active lease term, the lease remains in effect with the new owner and tenant. This principle is rooted in the legal doctrine known as "assignment of leases," which asserts that leases are binding agreements that continue even after a change in ownership. The new owner steps into the shoes of the previous landlord and is obligated to honor the terms of the lease, maintaining the same rights and responsibilities.

This continuity of the lease is important as it provides stability for the tenant, ensuring that they retain their rights to occupy and use the property as outlined in their lease agreement. This understanding of lease continuity is a foundational aspect of real estate law and protects tenant rights regardless of property ownership changes.